The First Civil Senate of the Federal Court of Justice (BGH), which is inter alia responsible for competition law, ruled on 17 July 2025 (Case No. I ZR 43/24) that advertising with monetary credits as part of a bonus scheme in connection with the purchase of medical devices is impermissible and incompatible with the German Drug Advertising Act (HWG) if the value exceeds €1.00.
Facts of the Case
The claimant is the Centre for Protection Against Unfair Competition. The defendant operates branches in Germany selling hearing aids from various manufacturers as well as other products for people with hearing impairments. The defendant cooperates with PAYBACK GmbH and advertised on its website the granting of PAYBACK points. Customers who presented their PAYBACK card at the checkout when paying received one PAYBACK point, worth €0.01, for every euro spent, credited to their PAYBACK account. Customers may redeem the accumulated points for cashless payouts, merchandise rewards, vouchers, air miles, or donations. The claimant argues that the contested advertising violates the prohibition on promotional gifts under Section 7 para. 1 HWG and is therefore seeking an injunction against the defendant.
Dispositive Provision: Section 7 HWG
According to Section 7 para. 1 sentence 1 HWG, it is, among other things, impermissible in connection with medical devices such as hearing aids to offer, announce, or grant benefits and other promotional gifts (goods or services). An exception to this strict prohibition on benefits exists pursuant to Section 7 para. 1 sentence 1 no. 1 half-sentence 1 alternative 2 HWG if the benefits or promotional gifts are of minor value, and under Section 7 para. 1 sentence 1 no. 2 lit. a HWG, among other cases, where the benefits or promotional gifts are granted in a fixed monetary amount or in an amount that can be calculated in a specific manner. The legislative purpose of Section 7 HWG is primarily to counteract the abstract risk of undue influence arising from advertising with gifts by largely restricting value-based advertising in the healthcare sector.
Previous Proceedings
The Regional Court of Hamburg (judgment of 12 May 2021 – 312 O 306/19) dismissed the claim at first instance, holding that the advertising in question did not constitute product-related advertising but was purely corporate advertising for a customer loyalty program. The scope of the HWG applies exclusively to product- or service-related sales advertising. Corporate advertising and pure image advertising without a specific product reference therefore do not fall under the prohibition on benefits in Section 7 HWG. According to the Hamburg Regional Court, there was also no abstract risk to health interests. Furthermore, the exception in Section 7 para. 1 sentence 1 no. 2 lit. a HWG applied in this case, as it involved a permissible cash discount.
The claimant filed an appeal against this judgment. The Higher Regional Court (OLG) of Hamburg (judgment of 29 February 2024 – 3 U 83/21) subsequently partially amended the Regional Court’s judgment and ordered the defendant, on the claimant’s auxiliary request, to cease and desist insofar as the granting of PAYBACK points with a total value exceeding €5.00 was advertised or facilitated. Regarding the main claim, which sought the granting of PAYBACK points with a value exceeding €1.00, the appeal was dismissed. Both parties have filed the permitted revision against the OLG Hamburg judgment.
Decision of the BGH
The long-awaited decision of the BGH in this practice-relevant case was issued with the judgment of 17 July 2025. With this judgment, the BGH set aside the appellate court’s decision insofar as it had been unfavorable to the claimant and ordered the defendant, in accordance with the main claim, to cease and desist and to reimburse the costs of the warning notice.
Like the appellate court, the BGH also recognized the product-related nature of the advertising involving the granting of PAYBACK points and thus saw the scope of the HWG as applicable. Advertising for the entire product range can therefore be considered product-related, and it is sufficient that the advertising is also directed at the sale of medical devices.
Furthermore, as previously held by the appellate court, the BGH found that the conditions for the exception in Section 7 para. 1 sentence 1 no. 2 lit. a HWG were not met and agreed in this respect with the reasoning of the OLG Hamburg. Consequently, such promotional gifts are only permissible as minor-value items under the exception in Section 7 para. 1 sentence 1 no. 1 half-sentence 1 alternative 2 HWG. The BGH, like the appellate court, also considered the requirements of this exception not to be fulfilled. However, it clarified that the relevant value threshold, contrary to the appellate court’s view, is not €5.00 but already €1.00.
The BGH had previously justified this value threshold on the basis that, due to the lack of price competition for prescription-only medicines – because of the applicable pricing regulations under the Medicines Act – even small benefits can easily attract the consumer’s attention and induce them to react in a way that maximizes utility. With this judgment, the BGH thus extends its case law on the €1.00 value threshold in the context of consumer advertising for price-regulated medicines to consumer advertising for non-price-regulated remedies, here medical devices. Contrary to the appellate court’s view, possible price competition for medical devices does not justify assuming a value threshold exceeding €1.00 in this area. Consumers, especially for non-price-regulated medicines and medical devices, compare prices and must take advertised promotional gifts into account. The differing forms of promotional gifts – such as PAYBACK points – make price comparison more difficult than permissible cash discounts and increase the risk of non-transparent pricing for consumers. Therefore, the applicable €1.00 value threshold for minor-value items must apply all the more in the case of consumer advertising for non-price-regulated remedies.
Practical Implications
It is already foreseeable that the BGH’s decision will have significant effects on actors in the healthcare market – particularly with regard to future requirements for designing advertising for medical devices and other non-price-regulated remedies in connection with any form of benefits. By explicitly confirming the €1.00 value threshold, the BGH has simultaneously clarified the scope of Section 7 HWG and established a uniform doctrinal approach for the area of remedies.
The decision makes clear that even minor monetary advantages – such as bonus points or comparable promotional gifts – can exert an impermissible inducement effect. Companies are therefore once again required to align their advertising measures strictly with the standards of Section 7 HWG and to ensure, in particular, that no circumvention occurs through non-transparent forms of benefits. The extension of the strict value threshold from advertising for price-regulated medicines to the entire field of remedies means that the scope for marketing concepts in this segment is considerably restricted.
