Chapter I General Principles
Article 1
This Law is enacted for the purposes of maintaining trading order,
protecting consumers' interests, ensuring fair competition, and promoting
economic stability and prosperity. Unless otherwise provided for in this
Law the provisions of other relevant laws shall apply.
Article 2
The term "enterprise" as used in this Law shall include,
- a company,
- a sole proprietorship or partnership,
- a trade association, and
- any other person or organization engaging in transactions through
the provision of goods or services.
Article 3
The term "trading counterpart" as used in this Law means any supplier
or purchaser that engages in or concludes transactions with an enterprise.
Article 4
The term "competition" as used in this Law means any conduct of one
enterprise to contest trading opportunities in the same market with one or
more enterprises through offering more favorable price, quantity, quality,
service or any other terms.
Article 5
The term "monopolistic enterprise" as used in this Law means any
enterprise that faces no competition or has a dominant position to enable
it to exclude competition in a relevant market.
Two or more enterprises shall be deemed monopolistic enterprises if
they do not in fact engage in price competition with each other and they
as a whole has the same status as the enterprise defined in the provisions
of the preceding paragraph.
The term "relevant market" as used in the first paragraph means a
geographic area or a coverage wherein enterprises compete in respect of
particular goods or services.
Article 6
The term "merger" as used in this Law means a situation:
- where an enterprise and another enterprise are merged into one;
- where an enterprise holds or acquires the shares or capital
contributions of another enterprise to an extent of more than one-third
of the total voting shares or total capital of such other enterprise;
- where an enterprise is assigned by or leases from another enterprise
the whole or the major part of the business or properties of such other
enterprise;
- where an enterprise operates jointly with another enterprise on a
regular basis or is entrusted by another enterprise to operate the
latter's business; or
- where an enterprise directly or indirectly controls the business
operation or the appointment or discharge of personnel of another
enterprise.
In computing the shares or capital contributions referred to in
subparagraph 2 of the preceding paragraph, the shares or capital
contributions of another enterprise held or acquired by an enterprise(s)
controlled by, controlling, or affiliated with the acquiring enterprise
under subparagraph 2 shall be included.
Article 7
The term "concerted action" as used in this Law means the conduct of
any enterprise, by means of contract, agreement or any other form of
mutual understanding, with any other competing enterprise, to jointly
determine the price of goods or services, or to limit the terms of
quantity, technology, products, facilities, trading counterparts, or
trading territory with respect to such goods and services, etc., and thereby to
restrict each other's business activities.
Article 8
The term "multi-level sales" as used in this Law means the promotion
or sales plan or organization pursuant to which the participants pay a
certain consideration to obtain the right to promote or sell goods or
services and the right to introduce other persons to participate in the
plan or organization, thereby receiving a commission, bonus or other economic
benefit.
"To pay a certain consideration" as used in the preceding paragraph
means the payment of money, the purchase of goods, the provision of
services, or the undertaking of an obligation.
Article 9
The term "competent authority" as used in this Law means the Fair Trade
Commission of the Cabinet at the central government level; the Department
of Reconstruction at the municipal level; and the county (or city)
government at the county (or city) level.
For any matter provided for in this Law that concerns the authorities
of any other ministry or commission, the Fair Trade Commission of the
Cabinet may consult with such other ministry or commission to deal
therewith.
CHAPTER II MONOPOLIES, MERGERS AND CONCERTED ACTIONS
Article 10
No monopolistic enterprises shall:
- directly or indirectly prevent any other enterprises from competing
by unfair means;
- improperly set, maintain or change the price for goods or the
remuneration for services;
- make a trading counterpart give preferential treatment without
justification; or
- otherwise abuse its market power.
Article 11
For any merger that falls within any of the following circumstances, an
application for approval shall be filed with the central competent
authority:
- as a result of the merger the enterprise(s) will have one third of
the market share;
- one of the enterprises in the merger has one fourth of the market
share; or
- sales for the preceding fiscal year of one of the enterprises in the
merger exceeds the threshold amount publicly announced by the central
competent authority.
The central competent authority shall make a decision of approval or
rejection within two months from the receipt of an application filed in
accordance with the preceding paragraph.
Article 12
The central competent authority may approve an application for merger
filed pursuant to the preceding article if the overall economic benefit of
the merger outweighs the disadvantages resulted from competition
restraint.
Article 13
Where any enterprise(s) fail to file an application for any merger that
is required for approval, or proceed with the merger despite that the
application is not approved, the central competent authority may prohibit
such merger, prescribe a period for such enterprise(s) to split, to
dispose of all or a part of the shares, to transfer a part of the
operations, or to remove certain persons from positions, or make any other
necessary dispositions.
For enterprise(s) violating the disposition made by the central
competent authority pursuant to the preceding paragraph, the central
competent authority may order the dissolution of such enterprise(s), or
the suspension or termination of their operations.
Article 14
No enterprise shall have any concerted action; unless the concerted
action that meets the requirements under one of the following
circumstances is beneficial to the economy as a whole and in the public
interest, and the central competent authority has approved such concerted
action:
- unifying the specifications or models of goods for the purpose of
reducing costs, improving quality, or increasing efficiency;
- joint research and development on goods or markets for the purpose
of upgrading technology, improving quality, reducing costs, or
increasing efficiency;
- each developing a separate and specialized area for the purpose of
rationalizing operations;
- entering into agreements concerning solely the competition in
foreign markets for the purpose of securing or promoting exports;
- joint acts in regards to the importation of foreign goods for the
purpose of strengthening trade;
- joint acts limiting the quantity of production and sales, equipment,
or prices for the purpose of meeting the demand orderly, while in
economic downturn, the market price of products is lower than the
average production costs so that the enterprises in a particular
industry have difficulty to maintain their business or encounter a
situation of overproduction; or
- joint acts for the purpose of improving operational efficiency or
strengthening the competitiveness of small-medium enterprises.
Article 15
The central competent authority may impose conditions or restrictions
or require undertakings in conjunction with an approval made pursuant to
the provisions of the preceding article.
The approval shall specify a time limit not exceeding three years. The
enterprises involved may, with justification, file a written application
for an extension thereof with the central competent authority within three
months prior to the expiration of such period; provided, however, that the
term of each extension shall not exceed three years.
Article 16
After a concerted action is approved, the central competent authority
may revoke the approval, alter the contents of the approval, or order the
enterprises involved to cease from continuing the conduct or rectify its
conduct, or to take necessary corrective actions if the cause for approval
no longer exists, the economic condition changes, or the enterprises
involved engage in any conduct beyond the scope of the approval.
Article 17
The central competent authority shall establish a specific registry to
record the approvals, conditions, restrictions, undertakings, time limits,
and relevant dispositions referred to in the preceding three articles and
publish these matters in the government gazette.
CHAPTER III UNFAIR COMPETITION
Article 18
Where an enterprise supplies goods to its trading counterpart for
resale to a third party or such third party makes further resale, the
trading counterpart and the third party shall be allowed to decide their
resale prices freely; any agreement contrary to this provision shall be
void.
Article 19
No enterprise shall have any of the following acts which is likely to
lessen competition or to impede fair competition:
- causing another enterprise to discontinue supply, purchase or other
business transactions with a particular enterprise for the purpose of
injuring such particular enterprise;
- treating another enterprise discriminatively without justification;
- causing the trading counterpart(s) of its competitors to do business
with itself by coercion, inducement with interest, or other improper
means;
- causing another enterprise to refrain from competing in price, or to
take part in a merger or a concerted action by coercion, inducement with
interest, or other improper means;
- acquiring the secret of production and sales, information concerning
trading counterparts or other technology related secret of any other
enterprise by coercion, inducement with interest, or other improper
means; or
- limiting its trading counterparts' business activity improperly by
means of the requirements of business engagement.
Article 20
No enterprise shall have any of the following acts with respect to the
goods or services it supplies:
- using in the same or similar manner, the personal name, business or
corporate name, or trademark of another, or container, packaging, or
appearance of another's goods, or any other symbol that represents such
person's goods, commonly known to relevant enterprises or consumers, so
as to cause confusion with such person's goods; or selling,
transporting, exporting, or importing goods bearing such representation;
- using in the same or similar manner, the personal name, business or
corporate name, or service mark of another, or any other symbol that
represents such person's business or service, commonly known to relevant
enterprises or consumers, so as to cause confusion with the facilities
or activities of the business or service of such person; or
- using on the same or similar goods the mark that is identical or
similar to a well-known foreign trademark that has not been registered
in this country; or selling, transporting, exporting, or importing goods
bearing such trademark.
The preceding paragraph shall not apply to any one of the following:
- using in an ordinary manner the generic name customarily associated
with the goods or the representation customarily used in the trade of
the same category of goods; or selling, transporting, exporting or
importing goods bearing such name or representation;
- using in an ordinary manner the name or representation that is
customarily used in the trade of the same type of business or service;
- using in good faith one's own name, or selling, transporting,
exporting or importing goods bearing such name; or
- using, with good faith, in the same or similar manner the
representation referred to in the first or second subparagraph of the
preceding paragraph before such representation having become commonly
known to the relevant enterprises or consumers, or using such
representation by any successor that acquires such representation
together with the business from a bone fide user; or selling,
transporting, exporting or importing goods bearing such representation.
Where any enterprise has any of the acts set forth in the third and
fourth subparagraphs of the preceding paragraph which is likely to damage
or cause confusion with the business, goods, facilities, or activities of
another enterprise, the latter enterprise may request the former to add
appropriate representation unless the former only transports such goods.
Article 21
No enterprise shall make or use false or misleading representations or
symbol as to price, quantity, quality, content, production process,
production date, valid period, method of use, purpose of use, place of
origin, manufacturer, place of manufacturing, processor, or place of
processing on goods or in advertisements, or in any other way making known
to the public.
No enterprise shall sell, transport, export or import goods bearing
false or misleading representations referred to in the preceding
paragraph.
The two preceding paragraphs shall apply mutatis mutandis to the
services of an enterprise.
Where any advertising agency makes or designs any advertisement that it
knows or is able to know is misleading, it shall be jointly and severally
liable with the principal of such advertisement for damages arising
therefrom. Where any advertising medium communicates or publishes any
advertisement that it knows or is able to know is likely to mislead the
public, it shall be jointly and severally liable with the principal of
such advertisement for the damages arising therefrom.
Article 22
No enterprise shall, for the purpose of competition, make or
disseminate any false statement that is able to damage the business
reputation of another.
Article 23
No multi-level sale shall be conducted if the participants thereof
receive commissions, bonuses, or other economic benefit mainly from
introducing others to participate, rather than from the marketing or sale
of the goods or services at reasonable market prices.
Article 23-1
Any participant in multi-level sales may rescind the participation
agreement by giving the multi-level enterprise written notice within
fourteen days after entering into such agreement.
Within a period of thirty days after rescission of the agreement takes
effect, the multi-level sales enterprise shall accept the application from
the participant for returning of goods, collect or accept goods returned
by the participant, and return to the participant all the payment for
goods made upon purchase and any other fees paid upon participation,
accumulated until the time of rescission.
In returning the payments made by the participant according to the
preceding paragraph, the multi-level sales enterprise may deduct upon the
time of returning of the goods the value decreased due to the damage or
loss attributable to the participant, and any bonus or remuneration
already paid to the participant for purchase of such goods.
If the returned goods as referred to in the preceding paragraph are
collected by the enterprise, the enterprise may deduct the shipping costs
required for such collection.
Article 23-2
After the lapse of the period for entitlement to rescind the agreement
as referred to in the first paragraph of the preceding article, the
participant may still terminate the agreement by writing and withdraw
itself from the multi-level sales.
Within thirty days from the termination of the agreement in accordance
with the preceding paragraph, the multi-level sales enterprise shall buy
back all goods possessed by the participant at ninety percent (90%) of the
original purchase price; provided that it may be deducted the bonuses or
remuneration paid to the participant for the purchase as well as the
amount of the decreased value of the goods.
Article 23-3
When the participant exercises the right to rescind or terminate the
agreement in accordance with the two preceding articles, the multi-level
sales enterprise may not claim damages or levy penalties against the
participant for such rescission or termination.
The provisions of the two preceding articles that relate to goods shall
apply mutatis mutandis to the supply of services.
Article 23-4
In addition to the provisions of this Law, regulations concerning any
multi-level sales enterprise' filing for record, inspection of activities,
notices to participants, and the content of participation agreements as
well as the protection of participants' interest are to be promulgated by
the central competent authority.
Article 24
In addition to what is provided for in this Law, no enterprise shall
otherwise have any deceptive or obviously unfair conduct that is able to
affect trading order.
CHAPTER IV FAIR TRADE COMMISSION
Article 25
In order to manage matters in respect of fair trade as set forth in
this Law, the Cabinet shall establish the Fair Trade Commission, which
shall be in charge of the following matters:
- preparation and formulation of fair trade policy, laws and
regulations;
- review of any fair trade matters related to this Law;
- investigation of activities of enterprises and economic conditions;
- investigation and disposition of any case violating this Law; and
- any other matters related to fair trade.
Article 26
The Fair Trade Commission may investigate and handle, upon complaints
or ex officio, any violation of the provisions of this Law that
harms the public interest.
Article 27
In conducting investigations under this Law, the Fair Trade Commission
may proceed in accordance with the following procedures:
- to notify the parties and any related third party to appear to make
statements;
- to notify relevant agencies, organizations, enterprises, or
individuals to submit books and records, documents, and any other
necessary materials or exhibits, and
- to dispatch personnel for any necessary on-site inspection of the
office, place of business, or other locations of the relevant
organization or enterprises.
An investigator carrying out its duties under this Law shall present
the documents supporting its duties; the person to be investigated may
refuse the investigation where the investigator fails to present such
documents.
Article 28
The Fair Trade Commission shall carry out its duties independently in
accordance with the law and may dispose of the cases in respect of fair
trade in the name of the Commission.
Article 29
There shall be a separate law enacted to govern the organizational
structure of the Fair Trade Commission.
CHAPTER V COMPENSATION FOR DAMAGES
Article 30
If any enterprise violates any of the provisions of this Law and
thereby infringes upon the rights and interests of another, the injured
may demand the removal of such infringement; if there is a likelihood of
infringement, prevention may also be claimed.
Article 31
Any enterprise that violates any of the provisions of this Law and
thereby infringes upon the rights and interests of another shall be liable
for the damages arising therefrom.
Article 32
In response to the request of the person being injured as referred to
in the preceding article, a court may, taking into consideration of the
nature of the infringement, award damages more than actual damages if
the violation is intentional; provided that no award shall exceed three
times of the amount of damages that is proven.
Where the infringing person gains from its act of infringement, the
injured may request to assess the damages exclusively based on the
monetary gain to such infringing person.
Article 33
No claim for damages as prescribed in this Chapter shall be allowed
unless the right is exercised within two years after the claimant knows
the act and the person liable for the damages; nor shall the claim be
allowed after lapse of ten years from the time of infringing conduct.
Article 34
In filing a suit with a court in accordance with this Law, the injured
may request the content of the judgment to be published in a newspaper at
the expenses of the infringing party.
CHAPTER VI PUNISHMENT
Article 35
If any enterprise violating the provisions of Articles 10, 14, or
paragraph 1 of Article 20 is ordered by the central competent authority
pursuant to Article 41 to cease therefrom, rectify its conduct, or take
necessary corrective action within the time prescribed in the order, and
after the lapse of such period, shall such enterprise fail to cease
therefrom, rectify such conduct, or take any necessary corrective action,
or after its ceasing therefrom, shall such enterprise have the same or
similar violation again, the actor shall be punished by imprisonment for
not more than three years or detention, or by a fine of not more than one
hundred million NT Dollars, or by both.
Any person violating any of the provisions of Article 23 shall be
punished by imprisonment for not more than three years or detention, or by
a fine of not more than one hundred million NT Dollars, or by
both.
Article 36
If any enterprise violating the provisions of Article 19 is ordered by
the central competent authority pursuant to Article 41 to cease therefrom,
rectify its conduct, or take necessary corrective action within the time
prescribed in the order, and after the lapse of such period, shall such
enterprise fail to cease therefrom, rectify such conduct, or take
necessary corrective action, or after its ceasing therefrom, shall such
enterprise have the same or similar violation again, the actor shall be
punished by imprisonment for not more than two years or detention, or by a
fine of not more than fifty million NT Dollars, or by both.
Article 37
Shall any enterprise violate the provisions of Article 22, the actor
shall be punished by imprisonment for not more than two years or
detention, or by a fine of not more than fifty million NT Dollars,
or by both.
No action shall be brought against the violation referred to in the
preceding paragraph unless there is a complaint filed.
Article 38
Shall any juristic person be convicted of the violation referred to in
any of the three preceding articles, not only the actor shall be punished
in accordance with the provisions of the three preceding articles, the
juristic person shall also be fined as prescribed in each of the
respective articles.
Article 39
Where other laws provide for more severe punishment than that
prescribed in the preceding four articles, the provisions of such other
laws shall apply.
Article 40
Where any enterprise(s) fail to file an application for any merger
required for approval or proceed with such merger despite that the
application is not approved, in addition to the disposition pursuant to
the provisions of Article 13, an administrative penalty of not less than
one hundred thousand nor more than fifty million NT Dollars shall
be assessed upon such enterprise.
Article 41
The Fair Trade Commission may order any enterprise that violates any of
the provisions of this Law to cease therefrom, rectify its conduct or take
necessary corrective action within the time prescribed in the order; in
addition, it may assess upon such enterprise an administrative penalty of
not less than fifty thousand nor more than twenty-five million NT
Dollars. Shall such enterprise fails to cease therefrom, rectify the
conduct or take any necessary corrective action after the lapse of the
prescribed period, the Fair Trade Commission may continue to order such
enterprise to cease therefrom, rectify the conduct or take any necessary
corrective action within the time prescribed in the order, and each time
may successively assess thereupon an administrative penalty of not less
than one hundred thousand nor more than fifty million NT Dollars
until its ceasing therefrom, rectifying its conduct or taking the
necessary corrective action.
Article 42
Any person violating the provisions of Article 23, in addition to being
subject to the disposition pursuant to the provisions of Article 41, may
be subject to an order for dissolution, suspension or termination of
business operation if the violation is serious.
Any person violating any of the provisions of paragraph 2 of Article
23-1, paragraph 2 of Article 23-2, or Article 23-3, may be ordered to
cease therefrom, rectify its conduct, or take necessary corrective action
within the time prescribed in the order; in addition, an administrative
penalty of not less than fifty thousand nor more than twenty-five million
NT Dollars may be assessed upon it. After the lapse of the
prescribed period, shall it fail to cease therefrom, rectify its conduct
or take any necessary corrective action within the time prescribed, it may
be ordered continuously to cease therefrom, rectify its conduct or take
necessary corrective action within the time prescribed, and in addition,
an administrative penalty of not less than fifty thousand nor more than
fifty million NT Dollars may be assessed successively thereupon
each time until it ceases therefrom, rectifies its conduct, or takes
necessary corrective action. Shall the violation be serious, an order for
dissolution of the enterprise or suspension or termination of its
operations may be made.
Any enterprise violating the regulations which is promulgated by the
central competent authority pursuant to the provisions of Article 23-4
shall be subject to the disposition prescribed in Article 41.
Article 43
Shall any person subject to any investigation conducted by the Fair
Trade Commission pursuant to the provisions of Article 27 refuse the
investigation without justification, or refuse to appear to respond or to
render relevant materials such as books and records, documents, or
exhibits by the set time limit, an administrative penalty of not less than
twenty thousand nor more than two hundred fifty thousand NT
Dollars shall be assessed upon it. Shall such person continue to refuse
without justification upon another notice, the Fair Trade Commission may
continue to issue notices of investigations, and may assess successively
thereupon an administrative penalty of not less than fifty thousand nor
more than five hundred thousand NT Dollars each time until it
accepts the investigation, appears to respond, or renders relevant
materials like books and records, documents, or exhibits.
Article 44
Shall any person upon which an administrative penalty is assessed
pursuant to the preceding four articles refuse to pay such penalty, the
matter shall be referred to the court for compulsory execution.
CHAPTER VII SUPPLEMENTARY PROVISIONS
Article 45
No provision of this Law shall apply to any proper conduct in
connection with the exercise of rights pursuant to the provisions of the
Copyright Law, Trademark Law, or Patent Law.
Article 46
Where there is any other law governing the conducts of enterprises in
respect of competition, such other law shall govern; provided that it does
not conflict with the legislative purposes of this Law.
Article 47
Any unrecognized foreign juristic person or organization may file a
complaint for public prosecution, private prosecution, or civil action
pursuant to the provisions of this Law; provided, however that any
national or organization of Chinese Taipei in the country of such foreign
juristic person or organization must be entitled to the right of the kind
in accordance with any treaty, or any law, regulation, or custom of such
country; or through any agreement entered into by any organization(s) or
institution(s) and approved by the central competent authority, for mutual
protection.
Article 48
The implementing rules of this Law shall be made and promulgated by the
central competent authority.
Article 49
This Law shall take effective one year from promulgation.
Amendments to this Law shall take effect from the date of promulgation.
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