Taipei County Footwear Manufacturers Association and the Tainan Leather Goods Manufacturers Association improperly deprived member enterprises of the right to participate in footwear exhibitions organized by the two associations, thus violating the Fair Trade Law
Case:
Taipei County Footwear Manufacturers Association and the Tainan Leather Goods Manufacturers Association improperly deprived member enterprises of the right to participate in footwear exhibitions organized by the two associations, thus violating the Fair Trade Law
Key Words:
footwear trade show (exhibition), participate in a trade show (exhibition)
Reference:
Fair Trade Commission Decision of February 20, 2001 (the 483rd Commissioners' Meeting); Disposition (90) Kung Ch'u Tzu No. 035
Industry:
Leather Footwear Manufacturing Industry (1502)
Relevant Laws:
Summary:
1. A footwear manufacturer reported that the Taipei County Footwear Manufacturers Association, together with the Tainan Leather Goods Manufacturers Association, sent out an official letter informing association members and enterprises participating in trade shows organized by the associations that those who participated in trade shows organized by subordinate organizations or by other entities would not be invited to participate in future trade shows organized by the two associations. Participation among association members in outside trade shows is extensive. There is neither any basis in the law nor any provision in the associations' charters to expressly forbid members from participating in outside trade events. Member enterprises have a right to organize their own trade events. From the standpoint of their mission to assist their members, the associations should offer guidance in setting up such exhibitions. Instead, citing pretexts such as a threat to the survival of the industry, the two assoc iations deprived members of their right to participate in trade shows organized by the associations. 2. The Fair Trade Commission investigated and found as follows: The 11 January 1999 resolution of the 21st Plenary of the Second Board of Supervisors meeting of the Taipei County Footwear Association stated that "The association organizes four footwear trade shows annually. If any subordinate organizations participate in any outside trade shows or exhibitions, member enterprises in said organizations will not be invited to attend any subsequent trade shows organized by the Associations." On 3 February 1999, the Taipei County association sent official letter Ref. Lung Tzu No. 88005 notifying all member enterprises and trade show participants of the aforementioned resolution. On 8 March 1999, the Taipei County association, together with the Tainan Leather Goods Manufacturers Association, jointly sent another letter outlining the aforementioned resolution, its 1999 trade show dates, scheduling and site information, to all member enterprises of both associations and trade show participants. On 24 December 1999, The People Group, Inc., a member enterprise of the Taipei County Footwear Manufacturers Association, was rejected in its application to participate in the Spring 2000 trade show being organized by the Taipei County association. The association based its rejection of The People Group's application on grounds that the Taiwan Footwear Industry Manufacturing and Marketing Alliance exhibition organized by the company violated association regulations. On 25 January 2000, the Third Plenary of the Third Board of Supervisors meeting resolved that: "If a company enters into a separate contract for participation in a trade show with a company already participating, the agreement is in writing and entails joint participation by more than three companies, those companies thereby unconditionally forfeit their rights to participate in the Taipei World Trade Center footwear exhibition." On 19 January 2000, in document Ref. Fu Tzu No. 021, the Tainan Leather Goods Manufacturers Association reiterated to member enterprises and trade show participants that "With regard to companies that participate in footwear trade shows or exhibitions unilaterally planned by subordinate organizations, those organizations and participating companies will not be welcome to participate in trade shows jointly organized by the Tainan Leather Goods Manufacturers Association and the Taipei County Footwear Manufacturers Association. 3. Because the membership of the Taipei County Footwear Manufacturers Association and the Tainan Leather Goods Manufacturers Association account for 24.6 percent and 16.4 percent of Chinese Taipei's total footwear manufacturing sector, respectively, and together about 41 percent of the total, the two associations used their organizational structure to act in concert to intervene and restrain the marketing activities of individual enterprises, disrupting product trade at footwear exhibitions and service supply and demand, thus violating Article 14 of the Fair Trade Law. Summarized by Ma, Ming-Ling; Supervised by Wu, Te-Sheng