Fair Trade Law Q&A - Other Restrictive Trade Practices

"Boycotting" refers to conduct by which an enterprise, for the purpose of injuring a particular enterprise or foreclosing such enterprise from future participation in market activities, induces other enterprises, or enters into concerted arrangements with other enterprises, to refuse to deal with the targeted enterprise. Such conduct falls within the scope of Subparagraph 1 of Article 20 of the Fair Trade Act, which prohibits the conduct intended to"cause another enterprise to discontinue supply, purchase or other business transactions with a particular enterprise for the purpose of injuring such particular enterprise."

In general, an individual enterprise remains free to decide, based on its own business considerations, whether to engage in commercial dealings with another enterprise. However, where an enterprise is subjected to a boycott or collective refusal to deal that prevents it from engaging in fair competition with its competitors, such conduct undermines market competition and is therefore subject to regulation under the Fair Trade Act.

Relevant Provision: Article 20 of the Fair Trade Act