Complaint filed against Pan Pacific International Marketing Co., Ltd., for allegedly violating the Fair Trade Law in its sale of membership cards for vacation resorts
Case:
Complaint filed against Pan Pacific International Marketing Co., Ltd., for allegedly violating the Fair Trade Law in its sale of membership cards for vacation resorts
Key Words:
international vacation resorts
Reference:
Fair Trade Commission Decision of October 13, 1999 (the 414th Commissioners' Meeting); Letters (88) Kung Yi Tzu No. 8806879-003 and (88) Kung Yi Tzu No. 8806879-004
Industry:
Other Consulting Services Industries (7409)
Relevant Laws:
Article 24 of the Fair Trade Law
Summary:
1. The Fair Trade Commission (FTC) received four complaints against Pan Pacific International Marketing Co., Ltd., ("Pan Pacific") in 1999. According to the complaints:
The company invited the public to attend a tourism seminar. During the seminar,
the company allegedly used coercive tactics to promote membership cards for
an international vacation resort. The company allegedly stressed that the value
of the membership cards included rights of re-sale and inheritance, and offered
free accommodations in foreign vacation resorts and substantial discounts to
on-site purchasers as incentives to attract customers to sign purchase contracts.
The contract stipulated only that members must pay a fee and abide by the rules
and regulations of the vacation resort; there was no mention of the company's
obligations. The contract was obviously unfair, and the complainants therefore
sought termination of their contracts and refunds.
2. The FTC held as follows:
All consumers attending the seminar were eligible to receive gifts regardless
of whether they signed the purchase contract, and could leave at their own discretion.
No causal relationship existed between Pan Pacific's concealment of facts relating
to the promotion and the factors that caused consumers to purchase the membership
cards to the vacation resort, such as personal travel requirements and preferential
prices.
In addition, judging from Article 12 of the Members' Memorandum of Understanding
that Pan Pacific requested the consumers to sign, the company did not exaggerate
the re-sale or inheritance value of its membership. Apart from stating that
Pan Pacific International was the authorized licensed Chinese Taipei agent of
vacation resort developer MTC, the Purchase Contract also stated the address
of the vacation resort developer, the name of the vacation resort, its location,
number of rooms, membership fees, management fees, and provided a summary of
the members' rights and obligations, and a provision to safeguard the rights
and privileges of members. Thus Pan Pacific International neither engaged in
deceptive acts nor obviously unfair acts of impeding free determination by trading
counterparts or coercing trading counterparts to accept unfair trading conditions.
3. It was therefore resolved at the 414th Commissioner's Meeting on October
13, 1999 that the actions of Pan Pacific in selling resort membership cards
did not violate the provisions of Article 24 of the Law.
Summarized by Lin Hui-yun
Supervised by Hu Kuang-yu
Appendix:
Pan Pacific International Marketing Co., Ltd.'s Uniform Invoice Number: 16595246