No C 70/4 Official  Journal  of the  European  Communities 21. 3.78 
Article  8 
Those  responsible  for  carrying  out  exploration 
projects  shall  submit  an  annual  report  to  the 
Commission  upon  the  progress  of the  work  and  the 
expenditure  incurred.  Representatives  of  the 
Commission  shall  have  access  at all  times  to the 
technical  and  financial  documents  relating  to the 
projects. 
Article  9 
All information  contained  in the  reports  referred  to 
in Article  8 shall  be confidential. Article  10 
The Commission  shall  report  annually  on  the 
progress  of each  of the  projects  to the  European 
Parliament  and  to the  Council. 
Article  11 
This  Regulation  shall  enter  into  force  on the  day 
following  its publication  in the Official  journal  of  the 
European  Communities.  It  shall  remain  in force  for a 
period  of three  years  from  the  date  of its entry  into 
force. 
This  Regulation  shall  be binding  in its entirety  and 
directly  applicable  in all Member  States. 
Proposal  for  a Council  Directive  relating  to the  approximation  of the  laws,  regulations 
and administrative  provisions  of the  Member  States  concerning  misleading  and  unfair 
advertising 
(Submitted  by  the Commission  to  the Council  on  1 March  1978) 
THE  COUNCIL  OF THE  EUROPEAN  COMMUNITIES, 
Having  regard  to  the  Treaty  establishing  the 
European  Economic  Community,  and  in particular 
Article  100  thereof, 
Having  regard  to the proposal  from  the Commision, 
Having  regard  to  the  opinion  of  the  European 
Parliament, 
Having  regard  to the  opinion  of the  Economic  and 
Social  Committee, 
Whereas  the  laws  against  misleading  and  unfair 
advertising  now  in force  in the  Member  States  differ 
widely;  whereas,  since  advertising  reaches  to a large 
extent  beyond  the  frontiers  of individual  Member 
States,  it has  a direct  affect  on the  establishment  and 
the functioning  of the  common  market; 
Whereas  unfair  and  misleading  advertising  is likely  to 
restrict  the  establishment  of a system  to ensure  that 
competition  is not  distorted  within  the  common 
market; acquiring  property  or  accepting  services  and  the 
differences  between  the  laws  lead,  in many  cases,  not 
only  to inadequate  levels  of consumer  protection,  but 
also prevent  the  execution  of advertising  campaigns 
beyond  national  boundaries  and  thus  affect  the free 
circulation  of goods  and  provision  of services; 
Whereas  the  preliminary  programme  of the  European 
Economic  Community  for  a consumer  protection  and 
information  policy  (1),  provides  in particular  for 
appropriate  action  for  the  protection  of consumers 
against  false  or misleading  advertising; 
Whereas  it is in the  interest  of the  public  in general, 
as well  as that  of consumers  and  all those  who,  in 
competition  with  one  another,  carry  on  a trade, 
business  or  profession,  throughout  the  common 
market,  to harmonize  national  provisions  against 
misleading  and  unfair  advertising; 
Whereas  minimum  criteria  for  determing  whether 
advertising  is  misleading  or  unfair  should  be 
established  for this  purpose; 
Whereas  misleading  and  unfair  advertising  may  cause 
a consumer  to take  decisions  prejudicial  to him  when (i) OJ No C 92, 25. 4. 1975,  p. 1. 
21.3.78 Official  Journal  of the European  Communities No C 70/5 
Whereas,  in  view  of  modern  techniques  of 
communication,  the  definition  of 'advertising'  must 
be worded  broadly,  but  should  not  extend  to policy 
statements,  the  publication  of comparative  product 
tests  by independent  organizations  and  any  similar 
statements; 
Whereas  the concepts  of 'misleading  advertising'  and 
'unfair  advertising'  must  as far as possible  be defined 
by reference  to objective  criteria; 
Whereas  comparative  •advertising  may  be beneficial 
to a consumer  and  a competitor  to the extent  that  it 
compares  material  and  verifiable  details  with  each 
other  and  is neither  misleading  nor  unfair; 
Whereas  the  laws  to be adopted  by Member  States 
against  misleading  and  unfair  advertising  must  be 
adequate  and  effective;  whereas  it is a matter  for the 
Member  States  whether  they  wish  these  to be matters 
of civil  law,  administrative  law  or criminal  law  or a 
combination  thereof; 
Whereas  persons  affected,  as well  as associations  with 
a legitimate  interest  in the matter,  must  have  facilities 
for initiating  proceedings  against  misleading  or unfair 
advertising  and  in particular  for obtaining  the quick 
cessation  of misleading  or unfair  advertisements; 
Whereas  if a person  advertises  by making  a factual 
claim  the  burden  of proof  that  his claim  is correct 
must  lie with  him; 
Whereas  the  provisions  of this  Directive  do  not 
preclude  Member  States  from  adopting  other 
measures  for the protection  of consumers,  subject  to 
their  obligations  under  the  Treaty  establishing  the 
EEC  and  in particular  the rules  on the free  movement 
of goods  and  services  and  competition, 
HAS  ADOPTED  THIS  DIRECTIVE: 
Article  1 
The objective  of  this  Directive  is to  protect 
consumers,  persons  carrying  on a trade,  business  or 
profession,  and  the  interests  of the  public  in general 
against  unfair  and  misleading  advertising. 
Article  2 
For the purpose  of this  Directive: 
— 'advertising'  means  the  making  of  any 
pronouncement  in the course  of a trade,  business or profession  for  the  purpose  of promoting  the 
supply  of goods  or services, 
— 'misleading  advertising'  means  any  advertising 
which  is entirely  or partially  false  or which, 
having  regard  to its total  effect,  including  its 
presentation,  misleads  or is likely  to mislead 
persons  addressed  or reached  thereby,  unless  it 
could  not  reasonably  be  foreseen  that  these 
persons  would  be reached  thereby, 
— 'unfair  advertising'  means  any  advertising  which: 
(a) casts  discredit  on another  person  by improper 
reference  to his nationality,  origin,  private  life 
or good  name,  or 
(b) injures  or is likely  to injure  the  commercial 
reputation  of  another  person  by  false 
statements  or defamatory  comments  con-
cerning  his firm,  goods  or services,  or 
(c) appeals  to sentiments  of fear,  or promotes 
social  or religious  discrimination,  or 
(d) clearly  infringes  the  principle  of the  social, 
economic  and  cultural  equality  of the  sexes, 
or 
(e) exploits  the  trust,  credulity  or  lack  of 
experience  of a consumer,  or influences  or is 
likely  to influence  a consumer  or the public  in 
general  in any  other  improper  manner, 
— 'goods'  means  property  of any  kind,  whether 
movable  or  immovable,  and  any  rights  or 
obligations  relating  to property. 
Article  3 
1. In  determining  whether  advertising  is 
misleading  or unfair,  pronouncements  shall  be taken 
into consideration  concerning  in particular: 
(a) the  characteristics  of the  goods  or services,  such 
as nature,  performance,  composition,  method 
and date  of manufacture  or provision,  fitness  for 
purpose,  usability,  quantity,  quality,  geographical 
or commercial  origin,  properties  and  the  results 
to be expected  from  use; 
(b) the  condition  of supply  of the goods  or services, 
such  as value  and  price,  conditions  of contract 
and of guarantee; 
(c) the  nature,  attributes  and  rights  of the advertiser, 
such  as his identity,  solvency,  abilities,  ownership 
of intellectual  property  rights  or awards  and 
distinctions. 
No C 70/6 Official  Journal  of the  European  Communities 21.3.78 
2. Advertising  shall  in particular  be regarded  as 
misleading  when  it omits  material  information,  and, 
by reason  of that  omission,  gives  a false  impression 
or arouses  expectations  which  the  advertiser  cannot 
satisfy. 
Article  4 
Comparative  advertising  shall  be allowed,  as long  as 
it compares  material  and  verifiable  details  and  is 
neither  misleading  nor unfair. 
Article  5 
Member  States  shall  adopt  adequate  and  effective 
laws  against  misleading  and  unfair  advertising. 
Such  laws  shall  provide  persons  affected  by 
misleading  or  unfair  advertising,  as  well  as 
associations  with  a legitimate  interest  in the matter, 
with  quick,  effective  and  inexpensive  facilities  for 
initiating  appropriate  legal  proceedings  against 
misleading  and  unfair  advertising. 
Member  States  shall  in particular  ensure  that: 
— the  courts  are  enabled,  even  without  proof  of 
fault  or of actual  prejudice: 
(a) to order  the  prohibition  or cessation  of 
misleading  or unfair  advertising;  and 
(b) to take  such  a decision  under  an accelerated 
procedure,  with  an  interim  or  final 
effect; 
— the  courts  are enabled: 
(a) to require  publication  of a corrective  state-
ment;  and 
(b) to require  publication  of their  decision  either 
in full  or in part  and  in such  form  as they 
may judge  adequate; 
— ensure  that  the sanctions  for infringing  these  laws 
are a sufficient  deterrent,  and,  where  appropriate, take into  account  the financial  outlay  on the ad-
vertising,  the extent  of the damage  and  any  profit 
resulting  from  the advertising. 
Article  6 
Where  the  advertiser  makes  a factual  claim,  the 
burden  of proof  that  his claim  is correct  shall  lie with 
him. 
Article  7 
Where  a Member  State  permits  the  operation  of 
controls  by self-regulatory  bodies  for the purpose  of 
counteracting  misleading  or unfair  advertising,  or 
recognizes  such  controls,  persons  or associations 
having  a right  to take  legal  proceedings  under 
Article  5 shall  have  both  that  right  and  the right  to 
refer  the matter  to such  self-regulatory  bodies. 
Article  8 
The present  Directive  does  not  prevent  Member 
States  taking  or maintaining  other  measures  for the 
protection  of consumers  against  misleading  or unfair 
advertising  to the extent  that  these  measures  are in 
conformity  with  the Treaty. 
Article  9 
Member  States  shall  bring  into  force  the measures 
necessary  to comply  with  this  Directive  within  18 
months  of its notification  and  shall  forthwith  inform 
the Commission  thereof. 
Member  States  shall  communicate  to the Commission 
the text  of the main  provisions  of national  law  which 
they adopt  in the field  covered  by this  Directive. 
Article  10 
This  Directive  is addressed  to the Member  States.