Unfair Trade Practices

Is misleading advertising illegal?

Yes, misleading advertising that deceives consumers about product characteristics (quality, price, origin) is prohibited under the Law on Competition and Consumer Rights.

Can I sue a competitor for stealing clients?

If client theft involves illegal means like bribery, trade secret theft, or spreading false information, it constitutes unfair competition and is actionable.

What is the penalty for cartel agreements?

Fines for cartel agreements can reach up to 5% of the annual turnover of the violating company, making it a severe financial risk.

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Unfair Trade Practices involve actions that violate standards of business integrity and harm competitors or consumers. In the energy and environmental sectors, this can manifest as "Greenwashing" (false eco-marketing), abuse of dominant position, artificial price inflation, or discriminatory conditions (e.g., in grid access). The Georgian National Competition Agency strictly monitors the market, and violations lead to heavy fines (up to 5% of turnover). It is critically important for businesses to protect themselves from unfair competition and avoid violating the law themselves.

Competition law experts at Legal.ge offer full legal services regarding unfair trade practices. Services include:

  • Representation at the Competition Agency: Preparing complaints against competitors or defending the company during an investigation initiated by the Agency.
  • Greenwashing Prevention: Legal audit of marketing campaigns and labeling to avoid misleading consumers about product "eco-friendliness."
  • Challenging Discrimination: Litigating if an energy monopolist (e.g., grid operator) unfairly restricts your market access.
  • Trade Secret Protection: Taking legal measures against illegal acquisition or use of trade secrets by a competitor.
  • Compliance Training: Conducting training for employees on antitrust law requirements.

Unfair trade practice services are relevant in the following situations:

  • A company claims its fuel is "100% eco-friendly" without a certificate. A competitor complains about misleading consumers.
  • A large energy company offers exclusive prices only if customers do not buy energy from another supplier (exclusive dealing).
  • A competitor spread false information about your product's poor quality, causing sales to drop (discredit).
  • Companies participating in a tender agreed on prices (cartel agreement). The victim company requests an investigation.

The field is regulated by the Law on Competition and the Law on Consumer Rights Protection. With the 2020 amendments, legislation has aligned with European standards, making protection mechanisms more effective.

Collaborating with a Legal.ge specialist ensures fair play in the market. Our lawyers will help you detect violations and protect your business from unscrupulous competitors.

Find competition law specialists on Legal.ge. Our platform gives you access to lawyers experienced in the Competition Agency and courts.

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