Ex-officio investigation by the Fair Trade Commission into the PC Home International Information Co., Ltd. violates the Fair Trade Law by improper publishing advertisements on the Internet

Case:

Ex-officio investigation by the Fair Trade Commission into the PC Home International Information Co., Ltd. violates the Fair Trade Law by improper publishing advertisements on the Internet

Key Words:

Internet, e-mail, PC Home online shopping, false advertisement

Reference:

Fair Trade Commission Decision of May 6, 2004 (the 652th Commissioners' Meeting); Disposition Kung Ch'u Tzu No. 093053

Industry:

Internet Information Supply Services (7321)

Relevant Laws:

Article 21(1) of the Fair Trade Law

1. The origin of this case was a letter from the Department of Health expressing that the Li Pan Co., Ltd. placed the advertisement "Japan's Most In in 2003 -- Mutso Yaotiao Adhesive Cloth" on the Internet (http://shopping.pchome.com.tw/free/index. html?=sv0002). It was found after investigation that the product in question was not a medical equipment defined in the Pharmaceutical Affairs Law, and the advertising claim "Even the soles of your feet will eliminate toxins: Pulls out the body's toxins and damp" was exaggerated and untrue.

2. Findings of the Fair Trade Commission (FTC) after investigation:
   In consideration of the triangular legal relationship between the PC Home International Information Co., Ltd., the Li Pan Co., Ltd., and online shopping consumers (via PC Home online shopping), it was found after examination of evidence concerning the advertisement content review process, the persons making out invoices in transactions between the three parties, the delivery of real products, and profit allocation methods that the Li Pan Co., Ltd. was merely the supplier of the advertised product, while the PC Home International Information Co., Ltd. was the actual seller of the advertised product and the producer/deliverer of the e-mail advertisement in question. Therefore, the PC Home International Information Co., Ltd. shall be the subject of the advertising action of this case. After the Department of Health expressed suspicion that the advertising claim "Even the soles of your feet will eliminate toxins: Pulls out the body's toxins and damp" was exaggerated and untrue, the FTC wrote to the PC Home International Information Co., Ltd. to request evidence of the product's medical theories or clinical test results. The fact that said company could not provide any proofs indicated that the aforementioned online advertisement in fact contained false and misleading representations.
3. Grounds for disposition:
   1. Investigation results indicated that the PC Home International Information Co., Ltd. was the subject of the e-mail advertising action concerning the "Mutso Yaotiao Adhesive Cloth" in this case, and could not provide proofs substantiating the advertising claim "Even the soles of your feet will eliminate toxins: Pulls out the body's toxins and damp," etc. Accordingly, the PC Home International Information Co., Ltd. had made false and misleading representations in e-mail advertisement, in violation of Article 21 (1) of the Fair Trade Law (FTL).
   2. After considering the PC Home International Information Co., Ltd.'s motivation for its illegal action, its scale of operations, the circumstances of the violation, and its cooperativeness during the investigation, it was accordingly determined in accordance with the fore part of Article 41 of the FTL that the company shall immediately cease its illegal action and be imposed an administrative fine of New Taiwan Dollars (NT$)50,000.

Appendix:
PC Home International Information Co., Ltd.'s Uniform Invoice Number: 16606102
Summarized by Tu, Cheng-Hsien; Supervised by Yeh, Tien-Fu