European Union: Court Of Justice Of European Union Clarifies Concept Of "Misleading Omission" With Respect To Energy Classification Labelling Of Vacuum Cleaners

On 25 July 2018, the Court of Justice of the European Union (the "ECJ") handed down its judgment concerning energy labels in a case involving Dyson and BSH (ECJ, 25 July 2018, Case C-632/16, Dyson Ltd and Dyson BV v. BSH Home Appliances NV). The ECJ held that not providing consumers with information on the testing conditions that resulted in the energy classification indicated on the energy label, does not constitute a "misleading omission" within the meaning of Article 7 of Directive 2005/29/EC of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market (the "Unfair Commercial Practices Directive").

Moreover, the ECJ held that suppliers and manufacturers of vacuum cleaners are prohibited from displaying, in a place other than the energy label, any labels or symbols conveying additional information which could mislead or confuse end-users with respect to the energy consumption of the vacuum cleaner at issue. Such an action would be regarded as an infringement of (the now repealed) Directive 2010/30/EU of 19 May 2010 on the indication by labelling and standard product information of the consumption of energy and other resources by energy-related products ("Directive 2010/30/EU") and Commission Delegated Regulation (EU) No 665/2013 of 3 May 2013 supplementing Directive 2010/30/EU with regard to energy labelling of vacuum cleaners (the "Delegated Regulation").

The ECJ delivered its judgment in response to a request for a preliminary ruling from the Antwerp Commercial Court in a dispute between two producers of vacuum cleaners, Dyson Ltd ("Dyson") and BSH Home Appliances NV ("BSH"). Dyson produces vacuum cleaners operating without dust bags while the vacuum cleaners of BSH came with dust bags.

In accordance with Directive 2010/30/EU and the Delegated Regulation, all vacuum cleaners sold in the EU are subject to mandatory energy labelling requirements in order to provide consumers with accurate and relevant information on their specific energy consumption, which could influence the end-user's choice of product. Furthermore, Directive 2010/30/EU and the Delegated Regulation dictate a uniform design and content for the labelling of vacuum cleaners as well as a standardised test to determine their energy consumption.

However, as claimed by Dyson, the standardised test disregards the fact that vacuum cleaners with dust bags require more power to generate suction (due to the clogging of the pores of the bag when filled with dust). By contrast, vacuum cleaners without dust bags, such as those produced by Dyson, are unaffected by this power requirement. Therefore, the test fails to acknowledge the fact that the energy consumption of vacuum cleaners with dust bags gradually increases as the bags become fuller. Since the differences in energy consumption between vacuum cleaners operating with and without dust bags are not duly conveyed by the EU energy labels, Dyson challenged the energy labelling of vacuum cleaners produced by BSH.

In Dyson's opinion, for consumers to be fully informed of all product characteristics, information relating to the testing conditions which resulted in the energy classification must be provided to the consumers. Dyson claimed that not providing consumers with such information constitutes a "misleading omission" within the meaning of Article 7 of the Unfair Commercial Practices Directive. A commercial practice is considered to be misleading if it omits material information that the average consumer needs, in view of the context, to take an informed transaction decision.

The ECJ rejected Dyson's argument as it considered the reproduction of the EU Ecolabel as the only additional reference which can be added to the energy label under Directive 2010/30/EU and the Delegated Regulation. The ECJ added that information relating to the vacuum cleaner's testing conditions is not covered under the exhaustive list of information that must be brought to the attention of the end-user by means of an energy label. Consequently, such information is not material information for the average consumer and is, therefore, not capable of constituting a misleading omission within the meaning of Article 7 of the Unfair Commercial Practices Directive.

In addition, Dyson claimed that BSH's practice of attaching additional labels and symbols namely, a green label stating "Energy A", a black label stating "Class A Performance" and an orange label stating "AAAA Best rated: A in all classes", is also misleading. Therefore, the referring court asked the ECJ whether Directive 2010/30/EU and the Delegated Regulation prohibit the display of other labels or symbols besides the energy label which contain information relating to the energy consumption of vacuum cleaners.

The ECJ decided that such a display of supplementary labels is indeed prohibited. First, the ECJ noted that the labels and symbols used by BSH are not provided for and do not satisfy the requirements of the Delegated Regulation. Second, the ECJ stated that such labels or symbols could potentially mislead or confuse the consumer with respect to the energy consumption because some of the labels used by BSH repeat the same information conveyed by the normal energy label while relying on a distinct graphic. In accordance with this guidance of the ECJ, it is ultimately for the Antwerp Commercial Court to assess the facts of the particular case. 

Interestingly, in 2013, Dyson brought an action for the annulment of the Delegated Regulation. These proceedings are still ongoing as in May 2017, the ECJ set aside the judgment of the General Court in this case and referred the proceedings back to the General Court for reconsideration (ECJ, 11 May 2017, Case C-44/16 P, Dyson Ltd v. Commission). The General Court is still to deliver its second judgment (GC, Case T-544/13 RENV, Dyson Ltd. v. Commission).

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