On February 16th, 2007, came into force law 20.169 on Unfair Competition, which punishes unfair competition aimed to attract customers of other market players. What are the main features of the law?:

Acts of unfair competition are defined, in general, as every conduct, contrary to good faith or good social customs which by unlawful means aims to attract clients of other competitors.

According to the new law, conducts of unfair competition include but are not limited to undue use of someone else´s reputation; use of brands or advertising that is misleading in relation to the capabilities of the products or services offered; offenses against religious beliefs or nationality, among others; comparisons based on false and non verifiable facts; conducts aimed to induce clients or providers to breach contractual obligations; and, the abusive resort to litigation in order to hinder the operations of a market agent.

The law grants four different actions against such conduct: (i) injunctions to prevent their effects; (ii) a judicial declaration that the conduct amounts to unfair competition; (iii) an order to publish such a declaration; and (iv) actions for damages. The three first claims can even be raised by trade associations.

Additionally, in case of serious misconduct or important damages, a fine of up to US$60,000 can be applied by the Antitrust Court (Tribunal de la Libre Competencia), upon a prior application by the National Economic Prosecutor (Fiscal Nacional Económico).

It is important to note that the law does not require that the conduct have any impact on the market, being it sufficient that it amount to unfair competition and affects any market player.

This law is intended to solve several situations that were not covered by the Antitrust Law, the Consumer Protection Law, the Industrial Property Law and the Copyright Law, but its broad provisions may have far reaching effects that were unforeseen by the lawmakers.