Yu Chia Enterprise Co., Ltd. violates the Fair Trade Law by its newspaper advertisement of “GoodAire Anti-SARS Revitalisor and Phytopeutic Concentrates"

Case:

Yu Chia Enterprise Co., Ltd. violates the Fair Trade Law by its newspaper advertisement of “GoodAire Anti-SARS Revitalisor and Phytopeutic Concentrates"

Key Words:

SARS, concentrates, antimicrobial, false advertisement

Reference:

Fair Trade Commission Decision of January 15, 2004 (the 636th Commissioners' Meeting); Disposition Kung Ch'u Tzu No. 093010

Industry:

Wholesale of Other Household Applicance and Supplies (4449)

Relevant Laws:

Article 21(1) of the Fair Trade Law

1. This case originated with a complaint letter filed by the Department of Health (DOH) with respect to an advertisement by Yu Chia Enterprise Co., Ltd. (hereinafter called “Yu Chia") on its “GoodAire Anti-SARS Revitalisor and Phytopeutic Concentrates" product on page D1 of the May 30, 2003 China Times. The DOH had found that the products were concentrates for air cleaning, not pharmaceutical items, and the claim “99.99 percent effective against bacteria" was neither a medical effect nor supported by data from medical theory or from clinical experiments. Yu Chia's advertisement therefore involved the likelihood of exaggerated or false representations.
2. Findings of the Fair Trade Commission (FTC) after investigation:
   In its advertisement, Yu Chia stated that the “Anti-SARS GoodAire Phytopeutic Concentrates" and that “the antimicrobial effect of the GoodAire Phytopeutic Concentrates at a concentration of 1 percent, killing 99.99 percent of bacteria in five minutes in a 15-ping[1] room, was supported by testing results from PSB Corporation, a testing institution approved by the Singapore Government." The wording “in a 15-ping room" was based upon the testing environment where Yu Chia ran tests on air components and chemical compounds from the 3rd to the 18th of August 2002, and that of “the antimicrobial effect…at a concentration of 1 percent, killing 99.99 percent of bacteria in five minutes" was based on a reported test from April 23, 2002 to May 3, 2002 with respect to five microorganisms. Yu Chia itself admitted that under testing conditions of “five microorganisms" and “at a concentration of 1 percent" as stated in the advertisement, the claimed antibacterial effect was achieved with only one microorganism, while the effects on the remaining microorganisms departed significantly from the results in the advertising data.
3. Grounds for disposition:
   1. In a single advertisement, Yu Chia used excerpts from the two abovementioned testing reports for which neither the testing conditions nor the results were the same, nor were the two relevant. In addition, according to two DOH professional opinions, although it was true that the product at issue could reduce the number of living bacteria within one to five minutes, the claim “99.99 percent effective against bacteria" was not supported by any test reports or laboratory data. Yu Chia thus violated Article 21(1) of the Fair Trade Law (FTL) with its false and misleading representations in the newspaper advertisement.
   2. Following consideration of the motive for the violation, the scope of the business, the circumstances of the violation, and the attitude of cooperation with the investigation, the FTC ordered Yu Chia to cease the unlawful acts and additionally imposed an administrative fine of New Taiwan Dollars (NT$)50,000 in accordance with the fore part of Article 41 of the FTL.

Appendix:
Yu Chia Enterprise Co., Ltd.'s Uniform Invoice Number: 70557509

Summarized by Ho, Yin-Ju; Supervised by Yeh, Tine-Fu
[1] Translator's note: One ping equals 3.3058 square meters.