Hsin-Tai Gas Equipment Engineering Co., Ltd. was accused of employing improper means to sell its gas equipment, in possible violation of the Fair Trade Law

Chinese Taipei

Case:

Keywords:

improper, gas equipment

Reference:

Fair Trade Commission Decision of November 18, 2004 (the 680th Commissioners' Meeting)

Industry:

Retail Sale of Other Retail Trade Not Elsewhere Classified (4799)

Relevant Law:

Article 24 of the Fair Trade Law

Summary:

1.
This case originated from a complaint letter filed by the citizen in Tucheng City stating that: Hsin-Tai Gas Equipment Engineering Co., Ltd. promoted gas equipment through door-to-door sales. The citizen, after paying NT$ 2,900 to the said company, confirmed with Hsin Tai Gas Co., Ltd. and found that there was no such service provided thereby. The citizen requested Hsin -Tai Gas Equipment Engineering Co., Ltd. to dismantle the meter and refund the money, but the said company did not respond, in possible violation of the Fair Trade Law. Afterwards, there was another complaint letter filed by the citizen in Taishan Township stating that: after Hsin-Tai Gas Equipment Engineering Co., Ltd. delivered the "Gas Service Notification," the company, in the name of gas safety inspection, indicated that the gas switch in the kitchen had a leak. The user requested to change a new switch, but the company said that the old product had no longer been produced and therefore the user should change the new product. The user doubted that, after the new product was changed, the noise heard during the gas switch test did not sound like a leak. However, when the company used a lighter to test the new product, it gave out an alarm.

2. In order to investigate the details of the case, the Fair Trade Commission (FTC) issued several letters or dispatched personnel to the business place of Hsin-Tai Gas Equipment Engineering Co., Ltd. However, the responsible person of the said company claimed that he was not in or, after the letters were dispatched, refused to attend the FTC for explanation. In addition, it was found that the responsible person of the company, Wu Chi Sen, had been complained and disposed by the FTC before for the complaint regarding Hsin Hsin Development Gas Equipment Co., Ltd. Wu Chi Sen shall already have an understanding about the administrative procedure of the FTC's investigation. Wu Chi Sen had been disposed by the Decision of July 15, 2004 (the 662nd Commissioners'Meeting) for refusing the Commission's investigation and for failing to attend the Commission's meeting for explanation without justified cause. Also, he was disposed for the complaint regarding Hsin-Chang International Gas Equipment Engineering Co., Ltd. It shows that Wu is used to employing the similar improper means to sell gas safety equipment. Upon the investigation, the FTC found that Hsin-Tai Gas Equipment Engineering co., Ltd. sold gas safety equipment as its business, a different business type than the gas companies that provide natural gas. However, the company intentionally employed a name similar to the natural gas provider, Hsin Tai Gas Co., Ltd. Moreover, from the content of the gas service notification printed and delivered by the said company, it said "We will dispatch personnel to your house to inspect soft pipelines and switches. It is free. Additional fees will be charged if you need to change the equipment." The content failed to mention the sales of gas intercepting valves. Furthermore, even though the company printed the full company name on the notifications, the part "Equipment Engineering" was covered by the seal that was difficult to distinguish. And the two characters "Hsin Tai" were enlarged in bold typeface on the up left side. It is obvious that the company intended to deliberately show the words "Hsin Tai." The overall effect was sufficient to mislead people into believing that the notifications were delivered by the local natural gas pipeline gas company.

3. It is not prohibited that the gas safety equipment business operator sells goods by door-to-door sales. However, when the business operator conducts door-to-door sales, it shall fully disclose the information and shall not undergo improper marketing by using safety inspection in the name of a pipeline gas company. Hsin Tai Gas Equipment Engineering Co., Ltd. employed the name of gas safety inspection to sell its products and failed to explain the actual sales subject to the trading counterparts. The overall marketing method was a deceptive conduct sufficient to adversely affect trading order, in violation of Article 24 of the Fair Trade Law. The FTC, in accordance with the fore part of Article 41 of the Fair Trade Law, ordered the company to immediately cease the aforesaid deceptive conduct.

Summarized by Wang, Hung-Chu

Supervised by Chih, Chin-Tsun

Appendix:

Hsin Tai Gas Equipment Engineering Co., Ltd.'s Uniform Invoice Number: 79999668

Hsin Tai Gas Co., Ltd.'s Uniform Invoice Number: 22000004

! : For information of translation, click here

1.	This case originated from a complaint letter filed by the citizen in Tucheng City stating that: Hsin-Tai Gas Equipment Engineering Co., Ltd. promoted gas equipment through door-to-door sales. The citizen, after paying NT$ 2,900 to the said company, confirmed with Hsin Tai Gas Co., Ltd. and found that there was no such service provided thereby. The citizen requested Hsin -Tai Gas Equipment Engineering Co., Ltd. to dismantle the meter and refund the money, but the said company did not respond, in possible violation of the Fair Trade Law. Afterwards, there was another complaint letter filed by the citizen in Taishan Township stating that: after Hsin-Tai Gas Equipment Engineering Co., Ltd. delivered the "Gas Service Notification," the company, in the name of gas safety inspection, indicated that the gas switch in the kitchen had a leak. The user requested to change a new switch, but the company said that the old product had no longer been produced and therefore the user should change the new product. The user doubted that, after the new product was changed, the noise heard during the gas switch test did not sound like a leak. However, when the company used a lighter to test the new product, it gave out an alarm.
2.	In order to investigate the details of the case, the Fair Trade Commission (FTC) issued several letters or dispatched personnel to the business place of Hsin-Tai Gas Equipment Engineering Co., Ltd. However, the responsible person of the said company claimed that he was not in or, after the letters were dispatched, refused to attend the FTC for explanation. In addition, it was found that the responsible person of the company, Wu Chi Sen, had been complained and disposed by the FTC before for the complaint regarding Hsin Hsin Development Gas Equipment Co., Ltd. Wu Chi Sen shall already have an understanding about the administrative procedure of the FTC's investigation. Wu Chi Sen had been disposed by the Decision of July 15, 2004 (the 662nd Commissioners'Meeting) for refusing the Commission's investigation and for failing to attend the Commission's meeting for explanation without justified cause. Also, he was disposed for the complaint regarding Hsin-Chang International Gas Equipment Engineering Co., Ltd. It shows that Wu is used to employing the similar improper means to sell gas safety equipment. Upon the investigation, the FTC found that Hsin-Tai Gas Equipment Engineering co., Ltd. sold gas safety equipment as its business, a different business type than the gas companies that provide natural gas. However, the company intentionally employed a name similar to the natural gas provider, Hsin Tai Gas Co., Ltd. Moreover, from the content of the gas service notification printed and delivered by the said company, it said "We will dispatch personnel to your house to inspect soft pipelines and switches. It is free. Additional fees will be charged if you need to change the equipment." The content failed to mention the sales of gas intercepting valves. Furthermore, even though the company printed the full company name on the notifications, the part "Equipment Engineering" was covered by the seal that was difficult to distinguish. And the two characters "Hsin Tai" were enlarged in bold typeface on the up left side. It is obvious that the company intended to deliberately show the words "Hsin Tai." The overall effect was sufficient to mislead people into believing that the notifications were delivered by the local natural gas pipeline gas company.
3.	It is not prohibited that the gas safety equipment business operator sells goods by door-to-door sales. However, when the business operator conducts door-to-door sales, it shall fully disclose the information and shall not undergo improper marketing by using safety inspection in the name of a pipeline gas company. Hsin Tai Gas Equipment Engineering Co., Ltd. employed the name of gas safety inspection to sell its products and failed to explain the actual sales subject to the trading counterparts. The overall marketing method was a deceptive conduct sufficient to adversely affect trading order, in violation of Article 24 of the Fair Trade Law. The FTC, in accordance with the fore part of Article 41 of the Fair Trade Law, ordered the company to immediately cease the aforesaid deceptive conduct.