Case:
The Supreme Administrative Court decision on Mei Yen Li Development Co. Ltd.'s violation of the Fair Trade Law, for the company's failure to purchase back the goods possessed by a participant at the time that such a participant terminated the contract and requested for returning the goodsKey Words:
multi-level sales, handle the returning of goods, report change
Reference:
Taipei Supreme Administrative Court Decision (96) Pan-Tzu No. 801
Industry:
Direct Selling Establishments (4872)
Article 23-2 of the Fair Trade Law
Summary:
The defendant, Fair Trade Commission (Defendant), initiated an ex officio investigation pursuant to a complaint and found that the Plaintiff, Mei Yen Li Development Co. Ltd. which conducted multi-level sales, failed to purchase back the goods possessed by a participant at a price 90% of the original purchase price when such a participant terminated the contract and requested for returning the goods. Additionally, the Plaintiff did not handle reporting change for an increase of business locations within the period prescribed by law; the representations, the proceeding period of and the profits obtained from the successful cases claimed by the Plaintiff were false, untrue and misleading. The Plaintiff violated the related provisions of the Fair Trade Law and the FTC disposed the Plaintiff in accordance with Articles 41, 42(2) and (3) of the same law. The Plaintiff was dissatisfied with the decision and filed an administrative action which was denied by the court of first instance. The Plaintiff therefore filed this Appeal.
It was found that the parties who were not in the Appeal, Sun, Chih-Chung and seven people, became the participants of the Plaintiff's multi-level sales by signing the participation contracts with the Plaintiff on February 26, 2002. On May 5, 2003, they issued legal attest letters to inform the Plaintiff of returning the payment of the goods. As the court of first instance assured of these facts, the Plaintiff had the obligation to purchase back the goods possessed by the participants who requested for returning the goods in accordance with the purpose of the text set forth in Articles 23-1(1) and 23-2 of the Fair Trade Law. Therefore, based on the results of arguments regarding evidence, the court of first instance stated in detail that the grounds to convince the judge for violation of Article 23-2 of the Fair Trade Law constituted by the Plaintiff failing to purchase back the goods possessed by a participant at a price 90% of the original purchase price in terms of the provision were adequate or there was no improper application of laws or regulations. Therefore, the claim in the Appeal accusing that the original decision infringed laws was groundless.
Appendix:
Mei Yen Li Development Co. Ltd.'s Uniform Invoice Number: 70606311
Summarized by Lai, Chia-Ching; Supervised by Lee, Wen-Show