In its ruling of March 27^th, 2025 (Case No. I ZR 64/24), the German Federal Court of Justice (Bundesgerichtshof, BGH) provided fundamental clarity by confirming that there is a concrete competitive relationship under § 2(1) No. 4 of the German Unfair Competition Act (UWG) between an airline and an online platform that files claims for passenger rights. In other words, airlines and passenger rights portals are competitors. This decision opens up new legal and procedural avenues for addressing the activities of legal-tech providers that offer standardised services to file compensation claims under Regulation (EU) No. 261/2004.

In the underlying case, an airline sought injunctive relief against a well-known passenger rights platform. In communications with customers, the platform had claimed that the airline systematically refused to comply with valid claims, and that only the portal could deliver a successful outcome. The appellate court (Hamburg Higher Regional Court) rejected the claim, reasoning that there was no competitive relationship between the parties: the claimant sold air travel (contractual services for carriage), while the defendant provided legal services under the German Legal Services Act (RDG) – with no meaningful economic overlap between the two.

The BGH rejected this view. The BGH clarified that companies may be in competition for two reasons: firstly, because they offer similar goods or services; or secondly, because one company disrupts another through conduct affecting the competitive process. The lower courts had rejected both possibilities, but the Federal Court held that the services provided by the airline and the passenger rights portal are, in fact, functionally equivalent.

This ruling highlights several key concerns regarding the business practices of passenger rights platforms. Entities operating in a competitive environment are subject to the requirements of the UWG. Claims that suggest passengers can only succeed through the portal — instead of direct contact with the airline or legal counsel, which they claim are bound to fail — may constitute misleading commercial practices within the definition of the UWG. Likewise, blanket disparagement of airlines may infringe the UWG, particularly § 4. In practice, this means that the advertising and public statements of legal-tech providers must be factually accurate, verifiable, and objective. Exaggerated success rates or inadmissible comparative advertising can now be challenged by competitors through various legal channels.

A particularly noteworthy aspect of the ruling concerns the procedural responsibility of passenger rights’ portals to ensure an orderly and efficient administration of justice. Going forward, it will no longer be as easy for such providers to file hundreds or thousands of isolated individual claims with the primary aim of maintaining their B2B business model and securing substantial success-based commissions from customers. Instead, the judgment implies the requirement of a broader duty of cooperation, requiring portals to support appropriate consolidation of related proceedings or, at the very least, coordinated handling of similar disputes – in the interest of procedural economy and to relieve pressure on the courts, which are already heavily burdened by a flood of near-identical claims.

For airlines, this presents a valuable opportunity to take legal action against the portals. The route of injunctive relief through the competition courts is open. At the same time, breaches of competition law can also be used strategically to defend against claims brought by professional passenger rights platforms.

Conclusion:
The Federal Court’s judgment of  March 27^th, 2025 significantly strengthens the legal and procedural position of airlines in their dealings with passenger rights portals. It confirms that a competitive relationship exists between the two, thereby triggering the full application of competition law. Providers operating in this space must comply with strict standards regarding their communications and business practices. Overall, the ruling offers a solid legal foundation for effectively and lawfully countering the impermissible market behaviour of legal-tech-driven business models.