A complaint is filed against Sen Meng Co., Ltd for publishing false and misleading representation product quality and content in the essential oil advertisement, not following instructions of the Fair Trade Commission’s disposition to cease the violative conduct, a violation of the posterior paragraph of Article 41 of the Fair Trade Law

Chinese Taipei

Case:

A complaint is filed against Sen Meng Co., Ltd for publishing false and misleading representation product quality and content in the essential oil advertisement, not following instructions of the Fair Trade Commission’s disposition to cease the violative conduct, a violation of the posterior paragraph of Article 41 of the Fair Trade Law

Key Words:

essential oil, false advertisement

Reference:

Fair Trade Commission Decision of March 24, 2005 (the 698th Commissioners' Meeting); Disposition (94) Kung Ch’u Tzu No. 094030

Industry:

Wholesale of General Merchandise (4560)

Relevant Laws:

Posterior Paragraph of Article 41 of the Fair Trade Law

Summary:

1. On April 15, 2004, the 649th Commissioners' Meeting of the Fair Trade Commission has decided to render a punishment on Sen Meng Co., Ltd (hereinafter referred to as Sen Meng Company). The Disposition Kung Ch’u Tzu No. 093044 was sent along with the letter no. Kung San Tzu 0930002887 on April 16, 2004. But, Sen Meng Company does not make any improvement, continues to allege on its company’s website that “Hua Chih Lien” herbal essential oil is almost century old in France, also falsely claims that “BOUQUET’S LOVE” Company guided by the Northern France “father of essential oil aromatherapy” Dr. Steve is well-known throughout the world, Sen Meng Company, a company that has advocated essential oil aromatherapy for ten years is “Taiwan general agent” for “BOUQUET’S LOVE” Company, the aforementioned acts of violation is not ceased.
   
2. Upon investigation, the Fair Trade Commission found that:
   
   1. Sen Meng Company received the aforementioned disposition on April 20, 2004. The text of the disposition is as such: (1) the respondent published essential oil advertisement in magazines, alleged that the Company is “Asian general agent for France “Hua Chih Lien””, the aforementioned advertisement has included false and misleading representation as to the product’s quality and content and violated the provision of Paragraph 1, Article 21 of the Fair Trade Law. (2) The respondent must cease the aforementioned acts of violation immediately starting from the next day of receiving this disposition.
      
   2. Sen Meng Company explained that the Company has followed the Fair Trade Commission’s instructions and immediately ceased to publish the aforementioned wordings and phrases on magazines, advertisements and publications after receiving the aforementioned disposition. However, the company has omitted and not discovered that the company’s web page also has similar statements and thus not making corrections simultaneously and promptly. On September 27, 2004, after the company received a letter related to the aforementioned statement from the Trade Fair Commission, the relevant product illustrations posted on its company’s web page were altered immediately on the next day, September 28, 2004. The wordings that the Fair Trade Commission has questions were deleted and the company’s profile was also changed.
      
   3. It is true that Sen Meng Company has imported the essential oils from France to Chinese Taipei, but it has designed the brand “Hua Chih Lien” for the sold products by itself, then, the company has applied a trademark and service mark for the brand. BOUQUET’S LOVE Company is a fictitious company made up by Sen Meng Company and not existence in practice.
      
3. Grounds of disposition:
   
   1. The reasons of the Fair Trade Commission’s disposition Kung Ch’u Tzu No. 093044 revealed that Sen Meng Company has alleged in advertisements published in the May 2002 issue of “Gifts and Premiums Buyers’ Guide” and December 2002 issue of “Gifts Buyers’ Catalogue” that Sen Meng Company is “Asian general agent for France “Hua Chih Lien””, but the investigation found that Sen Meng Company has imported its essential oil products from France via Lamp Berger Company. The essential oils of “Hua Chih Lien” brand are not found in France. The brand “Hua Chih Lien” is developed by Sen Meng Company and registered for trademark and service mark. Moreover, the essential oils of “Hua Chih Lien” brand are only sold in Chinese Taipei and not throughout Asia. Therefore, Sen Meng Company has directly alleged that the company is “Asian general agent for France “Hua Chih Lien”” in the advertisement at issue, such conduct has misled the general or relevant public into thinking that the aforementioned essential oils is France-brand products or it is true that the France’s brand “Hua Chih Lien” has authorized Sen Meng Company to be its general agent in Asia. Sen Meng Company gave false and misleading representation in product quality and content, the Fair Trade Commission thus has already imposed punishment on this violation.
      
   2. Sen Meng Company received the aforementioned disposition on April 20, 2004, after that, the Fair Trade Commission again received a complaint from the general public stating that the company has not made any improvements on September 13 of the same year. The company continued to allege on its company’s website that “‘Hua Chih Lien’ herbal essential oil is almost century old in France”, “‘BOUQUET’S LOVE’ Company guided by the Northern France “father of essential oil aromatherapy” Dr. Steve is well-known throughout the world, Sen Meng Company, a company that has advocated essential oil aromatherapy for ten years is “Taiwan general agent” for “BOUQUET’S LOVE” Company”. According to the purpose of the aforementioned disposition, the essential oils of “Hua Chih Lien” brand are not found in France, the brand “Hua Chih Lien” is developed by Sen Meng Company and registered for trademark and service mark. Also, Sen Meng Company has confessed that BOUQUET’S LOVE Company is a fictitious company made up by Sen Meng Company and certainly there is no “Asian general agent” or “Taiwan general agent” of BOUQUET’S LOVE Company as stated by Sen Meng Company. Sen Meng Company explained that the company has acted according to the aforementioned disposition from the Fair Trade Commission, stopped publishing wordings of “Asian general agent for ‘BOUQUET’S LOVE’” in magazines, advertisements and publications. But, Sen Meng Company has omitted and not discovered that the company’s web page also has similar statements and thus not making corrections simultaneously and promptly but the company has made corrections immediately after receiving a letter from the Fair Trade Commission notifying about the aforementioned omission, such remedy does not mean there is no law violations. It is substantiate to conclude that Sen Meng Company indeed has not ceased the false and misleading representation for the products at issue according to the purpose of the aforementioned Fair Trade Commission’s disposition.
      
   3. Sen Meng Company has made false and misleading representation advertisement as to the quality and content of essential oil products in advertisement, did not conform to the purpose of the Fair Trade Commission’s disposition Kung Ch’u Tzu No. 093044 and ceased the violated acts. Taking into consideration of the motive, purpose of Sen Meng Company in committing unlawful acts, anticipated improper profits, the degree and duration of the acts’ harm to trading order, benefits derived from the unlawful conducts, scale of operations, operating condition, market position, past violations, frequency, interval and punishment, substantial evidence of repentance after being found in violation and the cooperativeness during the investigations, therefore, in accordance with the posterior paragraph of Article 41 of the Fair Trade Law. The Fair Trade Commission ordered Sen Meng Company to cease the aforementioned unlawful acts immediately and imposed an administrative fine of NT$ 100,000 on Sen Meng Company.

Summarized by Lin, Shu-Ling;
Supervised by Yeh, Tien-Fu

Appendix:
Sen Meng Co., Ltd.’s Uniform Invoice Number: 89249503