Fair Trade Commission Guidelines on Cases Concerning
Promotion by Means of Gifts and Prizes

Passed by the 172nd Commissionersˇ¦ Meeting on January 23, 1995
Passed by the 376th Commissionersˇ¦ Meeting on January 13, 1999
Promulgated by Order (88) Kung Yi Tzu No. 00264 on January 26, 1999
Title amended by the 688th Commissionersˇ¦ Meeting on January 13, 2005
Promulgated by Order (94) Kung Fa Tzu No. 0940001278 on February 24, 2005
Amended by the 735th Commissionersˇ¦ Meeting on December 8, 2005
Promulgated by Order (94) Kung Yi Tzu No. 0940011080 on December 23, 2005

  1. These Guidelines are enacted for the purpose of ensuring fair competition by business, protecting consumers' rights, effectively enforcing Article 19, Subparagraph 3 of the Fair Trade Law, and handling cases of unfair competition where a business, by means of inducement with profit, causes the trading counterpart of a competitor to trade with itself.
  2. The value of gifts given away by business promoting sale of a product or service is limited as follows:
    1. For products or services priced over N.T. $ 100, the maximum value of the gift shall be 1/2 of the selling price of the product.
    2. For products or services priced less than N.T. $ 100, the maximum value of the gift shall be N.T. $ 50.
  3. The total annual value of prizes given at prize-giving activities held by a business is limited as follows:
    1. For a business whose annual sales for the previous fiscal year exceeded N.T. $ 2 billion, the maximum shall be N.T. $ 400 million.
    2. For business whose annual sales for the previous fiscal year exceeded N.T. $ 500 million but was less than N.T. $ 2 billion, the maximum shall be 1/5 of such sales amount.
    3. For business whose annual sales for the previous fiscal year was less than N.T. $ 500 million, the maximum shall be N.T.$ 100 million.
  4. When a business conducts a prize-giving activity, the value of the highest prize shall not exceed 120 times the base monthly labor wage rate promulgated by the Executive Yuan (Cabinet) Council of Labor Affairs.
  5. The prices of products or services, value of gifts and total value of prizes in this Guidelines are determined according to the following standards:
    1. Prices of products or services: The reasonable market prices that are given to trading counterparts at the time a business promotes sales with gift-giving activity.
    2. Value of gifts: The value is determined in order according to the following standards:
      1. Directly from the business that promotes sales with gift-giving activity.
      2. In the case that the gifts is produced by the business itself or acquired by the business from the market at reasonable price, the value for the said gifts is determined by its costs of production or acquisition.
      3. In the case that the business has acquired the gifts based on the trading terms other than price, or the aforementioned cost of acquisition is not available, then the value of gifts is determined by its retail price.
      4. Other reasonable and approved standards.
    3. Total value of prizes: The value is determined in order according to the following standards:
      1. Directly from the business that promotes sales with prize-giving activity.
      2. In the case that the prizes (either product or service) are produced by the business itself or acquired by the business from the market at reasonable price, the total value for the said prize (either product or service) is determined by its costs of production or acquisition.
      3. In the case that the business has acquired the prizes (either product or service) based on the trading terms other than price, or the aforementioned cost of acquisition for the prizes (either product or service) is not available, then the value of prizes is determined by the retail price of the said prizes (either product or service).
      4. Other reasonable and approved standards.
  6. The business violates the aforesaid Paragraph 2, 3 and 4 in its gift-and-prize promotion activities constitutes a violation of Article 19, Subparagraph 3 of the Fair Trade Law.
  7. These guidelines may be amended in accordance with the economic and social conditions.