Fair Trade Law Q&A - General Provisions

What types of conduct are subject to the regulation of the Fair Trade Act?

1. A monopolistic enterprise shall not engage in conduct that constitutes an abuse of market power, including using unfair means to directly or indirectly impede other enterprises from participating in competition, improperly determining, maintaining, or changing the prices of goods or services, requiring trading counterparts to give preferential treatment without justification, or engaging in other abusive practices.
2. Where a proposed merger meets a certain threshold, the parties shall file a pre-merger notification with the competent authority. A merger may be prohibited or subject to necessary remedial measures where the parties fail to file as required, consummate the merger during the waiting period, proceed with the merger after prohibition by the competent authority, or fail to comply with conditions imposed by the Commission.
3. Concerted actions are prohibited unless they fall within the exceptions set forth in Article 15 of the Fair Trade Act, which are beneficial to the overall economy and the public interest, and have been approved by the competent authority.
4. Unless there are justifications, an enterprise shall not restrict the resale prices at which its trading counterparts resell the goods or services determine by their trading counterparts for products it supplied.
5. the following conduct is prohibited where there is a likelihood of restraining competition:
   1. causing another enterprise to discontinue supply, purchase or other business transactions with a particular enterprise for the purpose of injuring such particular enterprise;
   2. treating another enterprise discriminatively without justification;
   3. preventing competitors from participating or engaging in competition by inducement with low price, or other improper means;
   4. causing another enterprise to refrain from competing in price by coercion, inducement with interest, or other improper means;
   5. causing another enterprise to take part in a merger, concerted action, or vertical restriction by coercion, inducement with interest, or other improper means;
   6. imposing improper restrictions on its trading counterparts' business activity as part of the requirements for trade engagement.
6. An enterprise shall not make or use false or misleading representations or symbols on their products or in advertising.
7. An enterprise shall not, for the purpose of competition, make or disseminate false statements that is capable of damaging the business reputation of another.
8. An enterprise shall not engage in any deceptive or obviously unfair conduct that is likely to affect trading order.