President Pepsi Food Co. violated the Fair Trade Law by conducting a deceptive drinks promotion

Chinese Taipei

Case:

President Pepsi Food Co. violated the Fair Trade Law by conducting a deceptive drinks promotion

Key Words:

Untrue and deceptive; obviously unfair

Reference:

Fair Trade Commission Decision of August 18, 1993 (the 98th Commission Meeting); Disposition (82) Kung Chu Tzu No. 053

Industry:

Soft drinks industry (1183)

Relevant Laws:

Article 24 of the Fair Trade Law

Summary:

1. Numbers of people file a complaint to the Fair Trade Commission alleging that the respondent's promotional activities involving "shake money number" drinks claimed to offer 60 chances of winning a money prize. However, all the winning numbers that were made public had not been drawn publicly, and exhibited some regularity, i.e., in each set of three digit numbers, when the hundred was an odd number, the following two digits would be greater than fifty, or when the hundred was an even number, the following two digits would be smaller than fifty. The numbers printed on the pull rings or the bottle caps showed a regularity just opposite to the aforementioned pattern. Since no match could ever occur, and no chance of winning exist at all, the respondent was obviously suspected of deceiving the consumers.

2. The investigation showed that the details of the promotional activity in question were as follows:

(1) The "shake the money number" promotion was conducted by the respondent, which during the promotional period of time, between June 14 and August 21, through the mass media like Min Sheng Daily made public a winning number every day except on Sundays. The winning number was chosen by the respondent each day from a total of 60 sets of winning numbers which had been selected by computer in advance. During this period of time, consumers who bought any of the "prize-winning" drinks would find a set of three-digit numbers printed on the pull ring or the bottle cap. If the three-digit number was the same as the winning number the respondent announced, and the lucky one did go to claim the award before the deadline of November 30, then he or she could receive the amount of money prize indicated on the pull ring or the bottle cap.

(2) The sales volume in this period was expected to reach about NT$ 150 million, and the sales volume projected at 8 million cans. The total planned prizes were NT$ 10,025,000, which was to be divided into 2,249 awards. The quota on the awards were as follows: 4 awards of NT$ one million, 20 awards of NT$ 100,000 , 200 awards of NT$ 10,000 and 2025 awards of NT$ 1,000.

(3) All the winning numbers were not drawn publicly. The respondent had selected 60 sets of numbers by computer in advance.

(4) With regard to its advertisement indicating "a winning number is drawn every day, and each pull ring or bottle cap comes with 60 chances of winning a prize", the respondent offered the following explanation:

a. "A winning number is drawn every day" meant to tell the consumers that the respondent would make public a winning number through the mass media on a daily basis. It is true that the number had been selected by computer in advance, but few people had knowledge of this. So, for the majority of general consumers, the statement of "a winning number is drawn every day" still stands true.

b. As the promotion lasted for 60 days, consumers had a total of 60 winning chances; that is why the advertisement states "each pull ring or bottle cap comes with 60 chances of winning a prize". Therefore, the specific catch line aimed to remind consumers not to give up too fast for not being lucky once as in the future they still have the opportunity to be a winner.

3. The respondent in this case launched a promotion for its "shake the money number" drinks. According to the advertisement it published in the press, during the promotional period of time (from June 14, 1993 through August 21, 1993), consumers who bought "shake the money number" drinks like Pepsi, Seven Up, Shan Kuo Lu, and Hua Nien Ta (low calorie drinks) would find a three-digit number and its corresponding money prize on the pull ring or the bottle cap. If the number on the pull ring or the bottle cap was identical to that made public by the respondent on a daily basis, the consumer could win the prize. The advertisement also contained catch lines such as "a winning number is drawn every day, and each pull ring or bottle cap comes with 60 chances of winning a prize". However, the investigation showed that the 60 sets of winning numbers had long been selected by computer , and made public by the respondent one at a time for 60 days in a row. In other words, no random drawing was conducted on a daily basis, and whether or not a consumer could win a prize had been determined even before they opened the drink. Moreover, the ways in which the awards were allocated, the number of total awards decided, and the winning numbers selected failed to clearly disclose relevant information which would enable consumers to make correct judgments and choices in advance. In the meantime, the respondent knew from the very beginning of the promotion that no winning numbers had been picked randomly every day, and with the regularity exhibited by the winning numbers, most of the pull rings or bottle caps were not winning rings or bottle caps and never would be, thus making repetitive check of the winning number published every day meaningless. Nonetheless, the respondent, though fully aware of the aforesaid situation, still claimed in its advertisement that "a winning number is drawn every day, and each pull ring and bottle cap comes with 60 chances of winning a prize." Consumers were thus misled to believe that all winning numbers were selected randomly (on a daily basis), and each pull ring or bottle cap would give the consumer 60 chances of winning an award. This led consumers to hold false expectations. For most of the buyers who did not make it the first time, their expectations were never to be fulfilled. Therefore, it can be concluded that the content of the advertisement was false, untrue misleading, and tantamount to deception that are sufficient to affect trading order, thus violates Article 24 of the Fair Trade Law.

　

Summarized by Chang, Lun-chen
Supervised by Shi, Chin-tsun

Appendix:
President Pepsi Food Co.'s Uniform Invoice Number.: 23528878

＊＊: For information of translation, click here

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