Current legal framework

Damage to the reputation of legal entities can be both pecuniary (e.g., loss of profit due to declining customers or sales) and non-pecuniary (e.g., diminished credibility, public trust, or competitiveness). While current legislation allows for compensation primarily for pecuniary damage, proving such claims is often challenging due to the complex evidentiary requirements. Compensation for non-pecuniary damage is only available in specific cases outlined by law. Adequate redress—such as an apology or financial compensation—may be granted, e.g., in situations involving damage to reputation caused by unfair competition, unlawful decisions by public authorities, or fraudulent insolvency petitions.

The Constitutional Court concluded that current legislation unsystematically distinguishes between the protection of legal entities’ reputations and fails to provide them with effective legal remedies in all cases. As the Court aptly stated, “no lie is so small that it does not deserve at least an apology.”

The constitutional dimension of the right to protection of reputation

Reputation is an intangible yet fundamental asset of a legal entity, inherently linked to its identity and difficult to quantify in monetary terms. The Constitutional Court has ruled that any legislation preventing legal entities from claiming adequate compensation for non-pecuniary damage to their reputation is unconstitutional. Under Article 10(1) of the Charter of Fundamental Rights and Freedoms, legal entities—whether entrepreneurial or non-profit—are entitled to reputation protection.

The Constitutional Court declared that the state has a duty to ensure effective safeguards against unlawful interference with reputation. The absence of legal provisions addressing non-pecuniary damage to a legal entity’s reputation constitutes a legislative gap. To bridge this gap, the Constitutional Court has applied the nearest relevant regulation—provisions on protection against unfair competition.

Conclusion of the constitutional court

The Constitutional Court has affirmed that all legal entities have the right to protection against unjustified interference with their reputation. This protection can be enforced under legislation on unfair competition. Legal entities may seek compensation not only for pecuniary damage and unjust enrichment but also for non-pecuniary harm—whether through a public apology or financial compensation. However, the Court also emphasised that the right to reputation must not be misused to suppress the constitutional right to freedom of expression and information. This includes preventing the abuse of litigation as a tool to intimidate journalists or civil activists.

If your company has been affected by reputational harm, our team at Deloitte Legal is ready to assist you. We will assess your case and recommend an appropriate legal strategy. Our firm has extensive experience representing clients in claims for damages and compensation, including commercial disputes, litigation against the state for unlawful decisions or tax authority misconduct, and employment-related disputes.