Social media channels are increasingly replacing traditional electronic communication via email. Platforms like LinkedIn or Xing offer us the opportunity to expand our professional network. However, there are also limits that must be observed here. A ruling by the Higher Regional Court of Hamm (Decision of May 3, 2023 – 18 U 154/22makes it clear how important it is to know the legal boundaries.
The most important points in brief
- The Higher Regional Court of Hamm has decided that unwanted advertising messages sent via online portals or social networks can be illegal spam.
- This is the case when there is no express consent from the recipient.
- For consent to be valid, it is not enough that the sender and recipient are connected on the channels.
- An advertisement is present if the sender promotes themselves or their services.
Background
In the context of a civil law proceeding, the Higher Regional Court of Hamm examined whether the advertising measures undertaken by the plaintiff were lawful.
The plaintiff provides services to real estate agents and offered, among other things, paid services for the referral of initial contacts to potential property sellers. The defendant is a real estate agent and had entered into a contract with the plaintiff to expand his brokerage business by acquiring more clients.
The plaintiff's activity consisted of contacting sellers of real estate who had not provided a phone number via the relevant online platforms. The goal was to ask the real estate sellers for permission in a subsequent phone call to contact them by phone regarding the planned real estate sale.
The contract stipulated remuneration for the provision of these datasets. In reality, however, the sellers were not aware in advance that a broker with marketing interest would come forward; they were only informed that someone would be in touch regarding the advertised properties. Express consent from the affected individuals could not be proven.
Since the defendant's efforts to acquire customers using the provided datasets were not successful, he decided to terminate the contract with the plaintiff and refused to pay the invoices already issued for brokering initial contacts.
As a result, the plaintiff filed a lawsuit with the Hagen Regional Court to claim the agreed-upon compensation. The defendant was of the opinion that the plaintiff had not performed the services properly and that he had thereby gotten into legal difficulties, as the potential sellers were not informed about a potential contact by a broker.
The Regional Court dismissed the lawsuit in the first instance, declaring the contract void under Section 134 of the German Civil Code (BGB) on the grounds that it aimed at anti-competitive actions.
Decision of the Higher Regional Court of Hamm
In its order, the Higher Regional Court of Hamm ruled that the concluded acquisition contract was void and was aimed at carrying out impermissible business practices according to § 7 (2) No. 2 UWG, thus obliging competitive behavior. It is of the opinion that the term „electronic mail“ within the meaning of § 7 (2) No. 2 UWG includes not only e-mails, SMS, and MMS, but also all messages via social networks such as Xing, Facebook, LinkedIn, or WhatsApp.
Advertising emails about such services may only be sent if prior consent has been obtained. Sending them without the express prior consent of the recipient constitutes an unfair commercial practice.
Although the messaging service of a real estate portal is not a social media service, the functionality of the inbox is the same.
It can be assumed that consumers offering property on a corresponding platform have a fundamental interest in being contacted. However, calls from real estate agents aimed at offering brokerage services or a brokerage contract to the seller are not covered by this implicitly assumed consent.
The term „advertising“ is defined as any statement made in the course of a trade, business, craft, or liberal profession with the aim of promoting the sale of goods or the provision of services.
Advertising permissible without consent in exceptional cases
It is often mistakenly assumed that electronic advertising via direct message to existing customers, social media friends, or followers is permissible even without their consent.
According to § 7 para. 3 UWG, the four requirements mentioned therein must be met cumulatively in order to send advertising messages without the prior, explicit consent of the recipient.
The sender must therefore be a business that received the customer's email address in connection with the sale of a product or service. The business must use this address for direct advertising of its own products or services, and the customer must not have objected to the use. Finally, the customer must be clearly and explicitly informed at the time the address is collected and with each use that they can object to the use at any time.
In practice, however, these prerequisites will at best be met in exceptional cases on social media channels.
The question now arises: how are entrepreneurs allowed to advertise on social networks without user consent at all? The answer is: hardly at all. In fact, only two options remain: operating a company page or fan page (however, data protection issues may arise depending on the provider) and placing paid advertisements or display ads.
LinkedIn as a gray area?
Although the legal situation seems clear, one could argue that the use of LinkedIn InMails represents a gray area, as this tool is explicitly provided for in LinkedIn's terms of service, and members implicitly consent to receiving messages from other members. This could, under certain circumstances, be considered a form of „prior consent.“.
However, LinkedIn's Terms of Service also emphasize that members are not allowed to send spam messages. For this reason, it is unlikely that mere membership on LinkedIn can be interpreted as express consent to receive advertising messages.
Conclusion
In Germany, the Act against Unfair Competition (UWG) provides a clear legal framework for sending advertising messages. In particular, Section 7 UWG stipulates that a commercial act involving the transmission of a message without the recipient's prior consent is considered unfair advertising.
The ruling by the Higher Regional Court of Hamm must be understood as a signal for all companies that use social media platforms like LinkedIn or Xing for business activities or marketing purposes. It shows that laws against unfair competition also apply in the digital world and highlights how important it is to ensure express consent from the recipient before sending advertising messages.
Consequently, it is recommended that companies review their marketing practices and ensure compliance with applicable data protection and competition laws to avoid legal consequences.
For advertising messages on LinkedIn, Facebook, Xing, and other social media platforms that may not meet the aforementioned requirements, advertising companies could face claims for injunctive relief under competition law, which can be penalized through cease and desist letters. These risks must be carefully considered in business decisions.
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