Taiwan Sunisland Int. Co., Ltd., when selling foreign resort membership cards, exploited its trading dominance, and engaged in deceptive and obviously unfair acts that affected the trading order.
Case:
Taiwan Sunisland Int. Co., Ltd., when selling foreign resort membership cards, exploited its trading dominance, and engaged in deceptive and obviously unfair acts that affected the trading order.
Key Words:
resort, membership card, improper claim, preferential price
Reference:
Fair Trade Commission Decision of May 3, 2001 (the 495th Commissioners' Meeting); Disposition (90) Kung Ch'u Tzu No. 067
Industry:
Other Support Services Industry (9209)
Relevant Law:
Article 24 of the Fair Trade Law
Summary:
1. Between July 2000 and February 2001, a number of complaints that lodged separately by the public alleged that Taiwan Sunisland Int. Co., Ltd. (Sunisland) made telephone calls to consumers saying that they won a prize or entered into short-list to lure consumers attending the company's "travel announcements" for prize collection. During the announcements, attendees were coerced into purchasing membership cards of the Shanghai Sunisland Village by means of longtime high-pressure tactics. Improper claims regarding the resort's actual conditions and the value of the membership cards were also made. Afterward when consumers wished to abolish the contracts within a reasonable period, Sunisland employed many tactics to obstruct them. 2. The Fair Trade Commission (FTC) surveyed among the complainants, and sent staffs to attend the "travel announcements" of Sunisland as consumers. The FTC found: (1) Sunisland, under the circumstance that consumers were in an inferior situation in accessing the trading information of the actual conditions of the resort and relevant rights and obligations, made exaggerated claims about the resort's actual conditions. Sunisland also provided the consumers with a "certificate of membership" to gain their trust, and enhanced its sale. These constituted as deceptive acts affecting the trading order. (2) At the announcements Sunisland emphasized that only those who signed contracts on site would enjoy a preferential price. In fact, however, all those who signed contracts on site received the preferential price. Therefore, Sunisland's improper claims had lured consumers into unwittingly trade that also constituted as deceptive acts affecting the trading order. (3) Sunisland required the consumers, who were under an inferior situation in accessing the trading information of the actual conditions of the resort and relevant rights and obligations, to pay various sums of money or to agree to sign contracts so that they could look at the details of the contracts. Afterward when consumers wished to unconditionally abolish the contracts within a reasonable period, Sunisland, by employing obviously unfair tactics such as requiring them to pay penalty, obstructed their freedom to decide either to abolish the contracts or to continue their trade. This constituted an obviously unfair practice. 3. According to the FTC's investigations, Sunisland, when selling foreign resort membership cards, exploited its trading dominance; made improper claims or concealments with respect to important facts such as the resort's actual conditions and the sale price of membership cards; required customers to offer down payment or give penalty so that they could look at the details of the contracts; obstructed their freedom to decide whether to abolish the contracts or to continue their trade. All of these constituted as deceptive and obviously unfair acts that affected the trading order in violation of Article 24 of the Fair Trade Law (FTL). As to whether Sunisland employed claims such as "won a prize or were short-listed" to lure consumers attending travel announcements, improper claiming of the value of the membership cards, and the coercion of consumers into trading by means of longtime high-pressure tactics, there was no concrete evidence to prove that these acts were in violation of the Law. After considering factors such as the company's business revenues, the motives for its conduct, the degree of impact on the trading order, the anticipated illicit gains, the duration of the unlawful conduct, and its attitude after the conduct, the FTC, pursuant to the fore part of Article 41 of the FTL, ordered Sunisland to immediately cease its unlawful conduct and to pay a fine of NT$900,000. Appendix: Taiwan Sunisland Int. Co., Ltd.'s Uniform Invoice Number: 16586128 Summarized by Sun, Ya-Chuan; Supervised by Horng, Der-Chang