Doing Business in Germany: Why Is It Better To Not Keep Your Fingers Crossed?
If your company wants to enter the German market, your marketing team needs to be aware of a number of legal and cultural loopholes. Mathias Röckel explains how to avoid social blunders and letters from your competitor’s lawyers.
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Mathias Röckel
Not too long ago, I reviewed a marketing campaign. The company, based in the US, wanted to enter the German market and asked me what I thought about their marketing collateral. I am not allowed to disclose the name of the company, or what their product does, but I am allowed to describe one of the images that came with the campaign.
It showed a man, dressed business casual, who held his crossed fingers into the camera. For my American colleagues, the message was clear. There was, at least in this context, no mistaking the image. The man with his crossed fingers wished a sincere ‘good luck!’.
Luckily for my client, they had a localization process in place that didn’t end when the newsletters they wanted to send out were translated. Instead, they asked us for feedback, they wanted to know if their content was legally and culturally suitable for the German market. They wanted to avoid intercultural blunders and legal issues.
How to Avoid Legal Issues
Wherever it is that your business is located, chances are that fair competition is considered important in your industry. There are surely also laws and regulations in place that make sure everybody plays by the rules. But although everybody in business should be aware of the importance of fair play, most issues in such localization processes have to do with the German legislation on unfair competition.
The problem is: what is fair competition? Different markets come up with different answers to this question. And if you are going to do business in Germany, it is important that you understand and play by the rules, written and unwritten.
As far as the written rules are concerned, you need to know about the “Gesetz gegen den unlauteren Wettbewerb”, or Act Against Unfair Competition. From a marketing perspective, the parts that cause the most work usually involve Section 4: protection of competitors,
“Unfairness shall have occurred where a person
1. discredits or denigrates the distinguishing marks, goods, services, activities, or personal or business circumstances of a competitor;
2. asserts or disseminates facts about the goods, services or business of a competitor or about the entrepreneur or a member of the management of the business, such facts being suited to harming the operation of the business or the credit of the entrepreneur, to the extent that the facts are not demonstrably true; if the communications are confidential and if the person making, or receiving, the communication has a legitimate interest therein, the action shall only be unfair where facts are asserted or disseminated contrary to the truth.”
and section 5: misleading commercial practices,
“1. Unfairness shall have occurred where a person engages in a misleading commercial practice which is suited to causing the consumer or other market participant to take a transactional decision which he would not have taken otherwise.”
Interpreting these lines is a job for experts, which is why, in Germany, marketing does not only provide marketing professionals, but also lawyers with an income – and many marketing collaterals that are perfectly good for your domestic market could, in Germany, result in your company receiving a letter from your competitor’s lawyers. Before you send out your newsletter, you should make sure your content is not only clever from a marketing perspective, but also safe from the legal perspective.
(Also, you really should make sure your company complies with the formal requirements for marketing emails within the EU described here)
If your company is going to do business in Germany by sending out newsletters or distributing any other form of marketing material, it is best not to push your luck. Instead, do it like my client did and set up a localization plan that involves local experts. They know that, in Germany, showing your crossed fingers to somebody does generally not mean that you are wishing them good luck. But that you are lying to them.
