Shen Chun International Marketing Co., Ltd. sold product “Restore Beauty EFG” and broadcasted false “Yuan Chi Feng Po” advertisement on television channel, thus violated Article 21 of the Fair Trade Law

Chinese Taipei

Case:

Shen Chun International Marketing Co., Ltd. sold product “Restore Beauty EFG” and broadcasted false “Yuan Chi Feng Po” advertisement on television channel, thus violated Article 21 of the Fair Trade Law

Key Words:

False advertisement, health food, breast augmentation

Reference:

Fair Trade Commission Decision of July 7, 2005 (the 713rd Commissioners' Meeting), Disposition Kung Ch’u Tzu No. 094076

Industry:

Wholesale of Other Food Products and Groceries (4429)

Relevant Laws:

Paragraph 1,Article 21 of the Fair Trade Law

Summary:

1. Shen Chun International Marketing Co., Ltd. (hereinafter referred to as Shen Chun Company) sold the product “Restore Beauty EFG” and broadcasted “Yuan Chi Feng Po” advertisement on cable television channel. The advertisement at issue made following claims: EFG breast beautification originated from Mei Hsiung Village, Iwate-ken, Japan; Lieng Mu Chian Hsiung was the Japanese godfather of breast augmentation who has created a legend of EFG’s eternity all across Japan; EFG became the first on the list of popular breast augmentation products in Japan in less than one week of its marketing; the book on EFG breast augmentation was the best-seller for thirteen weeks in a row ; and the Japanese public and AV girls g ave testimonies that they have increased the cup sizes of their bras after using EFG. However, th is Commission’s investigation found that Han Sheng Pharmaceutical Technology Co., Ltd. locally produced the product at issue. Shen Chun Company also admitted that the product at issue was neither imported from nor exported to Japan. In addition, Shen Chun Company admitted that the advertisement at issue was a means to promoting products and all contents were fictitious. Lieng Mu Chian Hsiung, the godfather of breast augmentation, was not found in Japan and he was only an actor like the other Japanese people and AV girls who were interviewed in the advertisement as needed by the plot; the EFG breast augmentation and the exhibited books were not found in Japan; the claims in the advertisement that EFG became the first on the list of popular breast augmentation products in Japan in less than one week of its marketing and the testimonies of the witnesses that they have increased the cup sizes of their bras after using EFG were all means to promoting the products. The claim in the advertisement that EFG breast augmentation originated from Mei Hsiung Village, Iwate-ken, Japan was also fictitious plot. Shen Chun Company stated that the advertisement at issue was actually filmed at the streets of Tokyo. However, the scenery of apiary and dairy farms introduced in the advertisement film were in fact shot at the farm in Heng Chun, Taiwan rather than Ohu-chiiki, Iwate-ken, Japan. Except for the ingredients of the products, which Shen Chun Company claimed to have the effect s of Chinese herbal medicine recorded in the pharmacopoeia , Shen Chun was unable to provide the relevant information on Lieng Mu Chian Hsiung, the godfather of breast augmentation, his books on EFG breast augmentation, EFG’s origin in Japan, the sales of EFG products and the concrete evidences of breast augmentation for the witnesses after they used the products at issue as stated in the advertisement at issue. Shen Chun Company was unable to prove the effects of the product as claimed by the Company. It is obvious that Shen Chun Company has made false and misleading representation as to the manufacturer, place of manufacturing, and quality and content on the products in the advertisement at issue.
2. Hsiao Hung Studio was the advertisement producer for the advertisement at issue; Shen Chun Company argued that the Company did not tell Hsiao Hung Studio that the product at issue was manufactured in Japan. Moreover, Shen Chun Company did not give the content of the advertisement at issue. Hsiao Hung Studio was responsible for gathering materials and shot the film on its own. However, Shen Chun Company admitted that the Company did not take strict examinations on the accuracy and truthfulness of the content of advertisement in the process of selecting advertisement film. Furthermore, since the product at issue was locally produced, Shen Chun Company surely kn ew the truthfulness of the content of the advertisement at issue if the Company had paid ordinary attention on it. But, Shen Chun Company did not fulfill the responsibility of verifying and confirming the facts of the advertisement prior to its broadcasting; therefore Shen Chun Company cannot shirk its responsibility with the excuse that advertisement is employed as a means to promoting the products. Furthermore, the broadcasting time for the advertisement at issue was 30 minutes and it was broadcasted frequently on several cable television channels during November 2004. The presentation of the advertisement at issue misled regular consumers into believing that the product at issue was either manufactured at or imported from Japan, and gave rise to breast augmentation as claimed in the advertisement. Therefore, it can be concluded that Shen Chun Company has broadcasted a false and misleading representation in its product advertisement of “R estore Beauty EFG” and violated the provision of Paragraph 1, Article 21 of the Fair Trade Law.
3. Taking into consideration the motivation, purpose, and expected improper benefit of the unlawful act of Shen Chun Company; the degree of the act’s harm to market order; the duration of the act’s harm to market order; benefits derived on account of the unlawful act; the scale, operating condition and market position of the enterprise; past violations; remorse shown for the act and attitude of cooperation in the investigation; and other factors, Shen Chun Company is ordered to cease the unlawful act and an administrative fine of NT$ 750,000 was imposed according to the anterior paragraph of the provision of Article 41 of the Fair Trade Law.

Summarized by Lin, Shu-Ling;
Supervised by Yeh, Tien-Fu

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