Dong-Sheng Construction Co. Ltd

Case:

Key Words:

store use, supermarket

Reference:

Fair Trade Commission Decision of November 1, 2007 (the 834th Commissioners' Meeting); Disposition Kung Ch'u Tzu No. 096166

Industry:

Buildings Construction (4100)

Relevant Laws:

Article 21(1) of the Fair Trade Law

Summary:

1. Each complainant has purchased a presale store from Dong-Sheng Construction Co. Ltd's (hereinafter referred to as "Dong-Sheng") "Upon Dong-Sheng Milan Maple" project located at Hsin-Chu City. Dong-Sheng advertised the store might be used for all purposes and described in the advertising brochure indicating the first floor store may be used for all purposes and has height of 6.5M, eligible for use as hot pot restaurant, Nestles Cafe, LACOSTE clothing specialty shop and other purposes shops. However, the Land Title Certificate recorded the main purposes for the building are: "Market (supermarket or shop type), and Hsin-Chu City official staff advised the shop may only be used for fresh food supermarket or convenient store, and may not be used for coffee shops, restaurants, clothing shops and etc.
2. Findings of FTC after investigation: Dong-Sheng contented on the "Floor Plan and Public Area Reference Map for the entire First Floor Area" of the "Upon Dong-Sheng Milan Maple" construction project brochure saying that the shop is "for all purposes and has height of 6.5M", and draw on "Upon Milan Maple day-view perspective drawing " with "Nescafe" coffee shop, "Lacoste" clothing shop, "Big John" jeans and other commercial shop signs. The overall commercial gave the impression that first floor shops of "Upon Milan Maple" were permitted for operating coffee shops, clothing shops, and other commercial shops. However investigation revealed that Dong-Sheng, was to, in accordance with Hsin-Chu City government June 25, (83) Fu-Chien-Shi-Tze No. 81836 Announcement, invest and establish privately operated Chu-Guang market (i.e. the first floor shop at "Upon Milan Maple"). According to the announcement, the market part should be used for supermarket purpose; construction license and building usage license permit the shop usage purpose being "supermarket". Moreover, the contract between Dong-Sheng and Hsin Chu City government indicates Dong-Sheng would be responsible for managing the stores and the operation type is limited to supermarket. Therefore, it is not permitted for other shop operations, causing the government officials of Hsin-Chu City to reject the Complainant's application for business registration certificate on the grounds that the business items need to be for supermarket use and the operator needs to be Dong-Sheng.
3. Grounds for disposition:
   (1) Dong-Sheng marked on this case's advertisement "shops of 6.5M height for all purpose use", "Nescafe" coffee shop, "Lacoste" shop, "Big John" Jeans clothing and other shop brands, made a false and misleading representation of the usage purpose of the product is considered to have violated Article 21(1) of the Fair Trade Law.
   (2) After considering Dong-Sheng's motivation, purpose, and expected improper benefit of the unlawful acts; the degree of the unlawful act's harm to market order; the duration of the unlawful act's harm to market order; benefits derived on account of the unlawful act; scale, operating condition, and market position of the enterprise; whether or not the type of unlawful act involved in the violation has been the subject of correction or warning by the central competent authority; types of, number of, and intervening time between past violations, and the punishment for such violations; remorse shown for the unlawful act and attitude of cooperation in the investigation, and other factors, Dong-Sheng is fined NT$ 1.5 million in accordance with the fore-section of Article 41 of the Fair Trade Law.

Appendix:
Dong-sheng Construction Co. Ltd.'s Uniform Invoice No. 23640302

Summarized by Fong, Jyun-Cyuan; Supervised by Shen, Li-Yu