menu
:::
Font size : S M L
::: :::

Fair Trade Act of 2000

Fair Trade Act of 2000

Promulgated on February 4, 1991,
Effective on February 4, 1992;
Amendments Promulgated on February 3, 1999,
Effective on February 5, 1999
(The 1999 Amendments amended Articles 10, 11, 16, 18, 19, 20, 21, 23, 35, 36, 37, 40, 41, 42, 46 and 49, and added Articles 23-1, 23-2, 23-3, and 23-4.)
Amendment of Article 9 Promulgated on April 26, 2000.

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,
 

  1. a company,
  2. a sole proprietorship or partnership,
  3. a trade association, and
  4. 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:

  1. where an enterprise and another enterprise are merged into one;
  2. 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;
  3. 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;
  4. 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
  5. 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 mutually 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, Executive Yuan, at the central government level; the metropolitan government at the metropolitan 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, Executive Yuan may consult with such other ministry or commission to deal therewith.
 

CHAPTER II
MONOPOLIES, MERGERS AND CONCERTED ACTIONS

Article 10
No monopolistic enterprises shall:


  1. directly or indirectly prevent any other enterprises from competing by unfair means;
  2. improperly set, maintain or change the price for goods or the remuneration for services;
  3. make a trading counterpart give preferential treatment without justification; or
  4. 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:

  1. as a result of the merger the enterprise(s) will have one third of the market share;
  2. one of the enterprises in the merger has one fourth of the market share; or
  3. 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:
 

  1. unifying the specifications or models of goods for the purpose of reducing costs, improving quality, or increasing efficiency;
  2. joint research and development on goods or markets for the purpose of upgrading technology, improving quality, reducing costs, or increasing efficiency;
  3. each developing a separate and specialized area for the purpose of rationalizing operations;
  4. entering into agreements concerning solely the competition in foreign markets for the purpose of securing or promoting exports;
  5. joint acts in regards to the importation of foreign goods for the purpose of strengthening trade;
  6. 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
  7. 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:

  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. causing the trading counterpart(s) of its competitors to do business with itself by coercion, inducement with interest, or other improper means;
  4. 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;
  5. 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
  6. 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:

  1. 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;
  2. 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
  3. 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:
 

  1. 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;
  2. using in an ordinary manner the name or representation that is customarily used in the trade of the same type of business or service;
  3. using in good faith one's own name, or selling, transporting, exporting or importing goods bearing such name; or
  4. 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 Executive Yuan shall establish the Fair Trade Commission, which shall be in charge of the following matters:

  1. preparation and formulation of fair trade policy, laws and regulations;
  2. review of any fair trade matters related to this Law;
  3. investigation of activities of enterprises and economic conditions;
  4. investigation and disposition of any case violating this Law; and
  5. 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:

  1. to notify the parties and any related third party to appear to make statements;
  2. to notify relevant agencies, organizations, enterprises, or individuals to submit books and records, documents, and any other necessary materials or exhibits, and
  3. 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 inured 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 Article 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 New Taiwan 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 the Republic of China 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.

Updated at:2014-10-20 10:14:27
back top
Language中文