Da Guan Technology Corp.

Case:

Da Guan Technology Corp. violated the Fair Trade Law by using improper means to cause other companies to refrain from price competition

Key Word(s):

Heat exchanger, shopping auction site, imagery infringement, refrain from price competition

Reference:

Fair Trade Commission Decision of May 21, 2014 (the 1176th Commissioners' Meeting); Disposition Kung Ch'u Tzu No.103068

Industry:

Plumbing, Heat and Air-conditioning Installation (4332)

Relevant Law(s):

Article 19(iv) of the Fair Trade Law

Summary:

1. The complainant received a call from Da Guan Technology Corp. (hereinafter referred to as "Da Guan") on July 24, 2013. The caller claimed to be the exclusive distributor of total heat exchangers of Mitsubishi Electric Taiwan Co., Ltd. (hereinafter referred to as "Mitsubishi Taiwan") and requested that the complainant jointly raise sales prices. The complainant did not comply and Da Guan reported the complainant to the sales site of Yahoo for copyright infringement, resulting in the complainant's products from being taken down. The complainant stated that this conduct severely damaged its rights and violated the Fair Trade Law.
2. Findings of the FTC after investigation:
   

   Although Da Guan was a distributor of Mitsubishi Taiwan, it only received authorization to use product imagery, but not agency authorization for the imagery, and was not authorized to report imagery infringement. Yet, Da Guan did indeed call the complainant in July 2013 and indicated that the complainant's price of total heat exchangers was too low. After which Da Guan reported the complainant to the sales site by fax stating that the complainant's "lossnay structure and principles" infringed Da Guan's copyright.

3. Grounds of disposition:
   

   Da Guan was not the copyright owner of the image and did not receive authorization from Mitsubishi Taiwan to report online imagery infringement, but still claimed to be the copyright owner when notifying the sales site of imagery infringement, which resulted in its competitor's webpage from being removed by the sales site. This conduct was the use of improper means to refrain competitors from price competition and violated Article 19(iv) of the Fair Trade Law. Considering that Da Guan already withdrew its complaint to the sales site before the complainant reported the conduct to the FTC, and that Da Guan's conduct was only towards the complainant and not any other competitors, the FTC determined that it caused a mild impact on the market and imposed an administrative fine of NT$50,000 in accordance with the first section of Article 41(1) of the Fair Trade Law.

Appendix:
Da Guan Technology Corp.'s Uniform Invoice Number: 28701897

Summarized by Yeh,Su-Yen; Supervised by Wu, Lieh-Ling