Full Wang International Development Co., Ltd

1308th Commissioners' Meeting (2016)

Case:

Full Wang International Development violated the Fair Trade Law by posting false advertisements to market the "Wings of the World" housing project

Keyword(s):

False advertising, housing project advertisement, public facility
Reference:
Fair Trade Commission Decision of November 30, 2016 (the 1308th Commissioners' Meeting); Disposition Kung Ch'u Tzu No. 105130

Industry:

Real Estate Development Activities (6700)

Relevant Law(s):

Article 21(1) of the Fair Trade Law

Summary:

  1. The floor plans for all the 1F and 2 F units in an advertisement posted by Full Wang International Development Co., Ltd. (hereinafter referred to as Full Wang International) for the "Wings of the World" housing project indicated that there would be public facilities including "Yi Sen Gym," "Ju Yue Swimming Pool," "Shui Yang Spa," "a sauna for men and a changing room," "a sauna for women and a changing room," and a "pool for children." As the FTC suspected that the design might be inconsistent with the building permit for the housing project and false advertising might be involved, it initiated an ex officio investigation.
  2. Findings of the FTC after investigation:
    The said advertisement and layout inserts "floor plans for all 1F units" and "floor plans for all 2F units" indicated there would be public facilities including the "Yi Sen Gym," "Ju Yue Swimming Pool," "Shui Yang Spa," "a sauna for men and a changing room," "a sauna for women and a changing room," and a "pool for children." Consumers would easily be misled into believing that the above public facilities could be used legally and then make purchase decisions based on this perception. However, according to the Taichung City Government, among the said public facilities, the "Yi Sen Gym" was inconsistent with the "smoke exhaustion room" indicated in the building permit, the Ju Yue Swimming Pool" and the "Shui Yang Spa" were inconsistent with the "reservoir" indicated in the building permit, the "sauna and changing room for men" and the "sauna and changing room for women" were inconsistent with the "elevator hall" indicated in the building permit, and finally the "swimming pool for children" was inconsistent with the "landscaping pool" indicated in the building permit. The builder should have acted according to Article 39 of the Building Act and applied for approve for change of design before it can make the above change. Otherwise, the builder would be considered in violation of Article 39 of the Building Act and fined in accordance with Article 87 of the same act.
  3. Grounds for disposition:
    In general, the public facilities depicted in real estate advertisements can be an important factor in consumers�� decision on whether they would make purchases. Normally, what consumers can understand from such advertisements is that they will be able to enjoy the public facilities indicated in the advertisements. They would have no way of knowing the pubic facilities indicated in the advertisements were actually built in violation of building regulations. Full Wang International claimed that it had considered changing the design to move the "Yi Sen Gym" from the "smoke exhaustion room" indicated in the building illustration to the space on the left for the management committee office and consolidate it with the yoga room. However, even if the change had been made in compliance with building regulations, the result would have been inconsistent with the location and space indicated in the advertisement. Furthermore, Full Wang International also admitted it would not be able to deliver the "Ju Yue Swimming Pool," "Shui Yang Spa," the "sauna and changing room for men," "sauna and changing room for women" and the "swimming pool for children" in the future. In other words, when the housing project was completed and the units were turned over, buyers would not be able to have or legally enjoy the public facilities indicated in the advertisement. Consequently, the advertisement was a false and misleading representation and could have an effect on transaction decision in violation of Paragraph 1 of Article 21 of the Fair Trade Law. The FCT therefore imposed an administrative fine of NT$1.8 million on Full Wang International Development.

Appendix:
Full Wang International Development Co., Ltd.'s Uniform Invoice Number: 97447647

Summarized by:Chuang, Ching-Yi; Supervised by: Chen, Jen-Ying