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There is no denying it - in online trade, the warning letters of shop operators by competitors, competition associations and consumer protection associations are increasing. On the one hand, this is due to the sometimes unclear and increasingly complicated legal provisions in distance selling, which make it difficult for shop operators to comply with all legal requirements, with the result that they can usually only be implemented with the help of specialised legal service providers.

On the other hand, even mass cease-and-desist letters are still rarely classified as abusive, so that this theoretical consequence has no deterrent effect on cease-and-desist lawyers.

And finally, many online traders still shy away from facing this danger. Either they don't want to or can't afford the costs of legal advice or protection in advance, for example when setting up a business. warning letters are thus virtually pre-programmed and ultimately usually more expensive on the bottom line - not to mention the hassle that such a case brings.

What is a warning letter?

The warning letter is a letter in which the person being warned is accused of having violated competition laws. Furthermore, in the penalty-based cease-and-desist declaration attached to the letter, he is requested to affirm by signature that he will refrain from this unlawful conduct in the future. The costs for this vary - depending on whether the letter is sent by post or fax.

The costs for this vary - depending on whether an association issues a warning or a competitor has a lawyer issue a warning. In the former case, a lump sum is usually due; in the latter case, it depends on the value in dispute, whereby a value in dispute of 10,000 EUR upwards is taken as a basis for competition law warning letters - that would be a lump sum of at least 745.40 EUR/net.

Thus, warning letter is to be seen as a quasi contractual offer for an out-of-court settlement of the dispute, combined with the threat of a severe contractual penalty in the event of a future breach of contract by the warned party.

However, the linchpin of a warning letter is the above-mentioned cease-and-desist declaration with penalty clause. By signing it, the warned party undertakes to cease and desist from the unlawful conduct that has already been warned about - for an unlimited period of time! In concrete terms, this means that you have to fear for the rest of your life that you will be asked to pay if you repeat the mistake.

What should you do in the case of a warning letter?

Do not ignore it!

Ignoring a warning letter is fatal, because you won't get out of it any time soon. If you ignore the letter, the preliminary injunction procedure will automatically follow after a short period of 7 to 14 days. In this case, the cease-and-desist declaration will be replaced by the court by means of an order, with the consequence that the cease-and-desist declaration will be issued as requested by the warning party in court. As you can imagine, this means even higher costs.

Observe deadlines!

In principle, the person issuing the warning must set a reasonable deadline. However, this may vary from case to case; as a rule, warning letters has very short deadlines. However - in any case you should adhere to them.

To this end, you must be very meticulous: pay attention to the deadline for submitting the cease-and-desist declaration stated in the letter. Make a note of the date of receipt.

Do NOT sign the cease-and-desist declaration immediately

Pre-formulated cease-and-desist declarations are often too broad, the amount in dispute and the contractual penalty are set very high, and the waiver of the continuation connection is inappropriate. You do not have to accept this!

A modified cease-and-desist declaration, on the other hand, takes into account the cease-and-desist claim of the person issuing the warning, but also ensures that nothing unreasonable can be demanded from the person being warned.

At this point, it is advisable to seek specialised legal advice at the latest.

The deadline set in the warning letter primarily refers to the cease-and-desist declaration. For you it is now a question of: on the one hand, you must react within the time limit set for you, on the other hand, you must not under any circumstances sign the attached cease-and-desist declaration hastily in view of the far-reaching consequences already explained!

Checking the justification of the warning letter

With or without a lawyer, you must now check whether the warning letter is justified. In concrete terms, you will be faced with the following questions:

  • 1 - Have I actually committed an infringement of competition law?
  • 2 - Does the person issuing the warning actually have a competitive relationship with me?
  • 3 - Is it really about the elimination of the illegal act, or is the warning letter possibly abusive?

In the latter case, you must inform the warning party in writing of the lack of justification. However, it is often very difficult to determine whether the warning is an abuse of rights, which is why I advise you to consult a lawyer!

Conclusion: If you are one of the traders who have already received a warning letter and are supposed to submit a cease-and-desist declaration within a short period of time, it is not advisable to simply sign this pre-formulated cease-and-desist declaration without checking it. Regardless of the legality of a warning letter, by signing it you bind yourself for life to the stipulations contained therein and future violations can result in very expensive contractual penalties.

The author of this article, Hans-Peter Kröger, is a lawyer and wine merchant. He offers business members of Wein-Plus very favourable consulting packages as part of a framework agreement. Further information and contact details can be found here: Framework agreement RA Kröger

RA Kröger offers Business Premium members of wein.plus a free initial consultation after receiving a warning letter: To the initial consultation

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