Unfair competition refers to a set of commercial practices that are contrary to the rules of fairness and honesty in business and are intended to harm competitors. These practices, although often legal, are morally reprehensible and can cause economic harm to other companies. Unfair competition is based on the principle of civil liability, and victimised companies can take legal action to obtain compensation for the damages suffered.
The main forms of unfair competition include:
- Denigration: Spreading false or misleading information to discredit a competitor or their products.
- Confusion: Imitating the distinctive signs of another company (brands, logos, packaging, etc.) to create confusion in the minds of consumers.
- Free riding: Taking advantage of another company’s reputation or investments without adding any value.
- Disruption: Sabotaging a competitor’s activities, for example, by poaching its employees or disrupting its distribution network.
Unfair competition undermines fair trade rules and damages trust between businesses and consumers. Businesses that suffer harm can obtain financial compensation and measures to stop unfair practices.