Although advertising that compares, likens or differentiates is not of itself unlawful, it will contravene section 18 of the ACL if it is misleading or deceptive.
Comparative advertising occurs when businesses seek to promote their products by:
- favourably comparing them, or their price, with those of a rival business
- denigrating rival products
- showing the positive benefits of their product using a 'before' and 'after' comparison.
- An advertisement saying that a product would last as long as those of a rival was misleading because the statement was correct only in relation to one of the rival's range of products, but not others.
See: Energizer Australia Pty Ltd v Remington Products Australia Pty Ltd  FCA 58 but compare Gillette Australia Pty Ltd v Energizer Australia Pty Ltd  FCAFC 223
- An advertisement favourably comparing the price of the advertiser's products with those of a rival was misleading because it did not disclose that the rival's customers were entitled to a rebate which reduced the amount they would actually pay.
See: Luxottica Retail Australia Pty Ltd v Specsavers Pty Ltd  FCA 423
- An advertisement showing a contest between rival products in which one completely devastated the other and caused it to emit smoke was misleading because in five of the six takes of the advertisement both products emitted smoke and the advertiser s product was just as badly affected by the contest as the other.
See: Makita (Australia) Pty Ltd v Black & Decker (Australasia) Pty Ltd  FCA 166