Taipei County Photography Association

Case:

The Supreme Administrative Court overruled Taipei County Photography Association's administrative litigation concerning the violation of the Fair Trade Law

Key Words:

association, no price competition, joint declaration

Reference:

Supreme Administrative Court Decision (98) Pan-Tzu No. 291

Industry:

Business Associations (9421)

Relevant Laws:

Article 14 of the Fair Trade Law

Summary:

1. The appellee (the FTC) investigated a compliant and found the following: on March 16, 2005, the appellant (Taipei County Photography Association) and Taipei County Photography Worker Union held a conference regarding photos specifically taken for national identification cards. They agreed to restrict members from price competition. Later, they issued a joint declaration and sent the written declaration to their members. The appellee concluded that the appellant violates Article 14(1) of the Fair Trade Law for the following reasons: the appellant and Taipei County Photography Worker Union agreed to restrict members from price competition for the business regarding national identification photos. This impeded free competition in market and was sufficient to affect the demand and supply function of photo printing market in Taipei County. The appellee imposed disposition Kung Ch'u Tzu No. 094112 on the appellant and Taipei County Photography Worker Union pursuant to Article 41 of the Fair Trade Law. The appellant disagreed with the disposition and filed this administrative action.
2. The appellant is a business association established pursuant to the Commercial Group Act, its members are companies or firms engaging in photo shoots, photo printing, or sales of photo equipments. Members of the appellant and Taipei County Photography Worker Union are enterprises that compete horizontally; if the appellant and Taipei County Photography Worker Union use their dominant positions to restrict members business activities, market competitions would be restricted. Such action constitutes a concerted action in Article 7(4) of the Fair Trade Law and shall be regulated by the Fair Trade Law. Whether the agreement is enforced or not has nothing to do with the determination of law violations. The appellant and Taipei County Photography Worker Union held a conference regarding photos specifically taken for national identification cards and they both agreed to restrict members from price competition, thus impeding free market competitions. Later on, they issued a joint declaration, and the appellant sent the written declaration to members. Even though the joint declaration does not contain a fee standard, members may actually restrain from price competition under the impacts of the organization to which they belong. As a result, an enterprise may not use advantages in price, quantity, quality, service, or other conditions to seek business opportunities as the market mechanism will be affected and competitions will be restricted. The lower court has already analyzed in detail the following aspects in its decision: whether the agreement is enforced or the number of members complying with the restraint on price competition does not affect the determination of law violations, statements by the appellant are meritless, the original decision is correct in overruling appellant's petition. The appeal was groundless to petition this court to dismiss the original decision of the lower court for violating the Fair Trade Law and relevant regulations. The action should be overruled.

Summarized by Lai, Chia-Ching; supervised by Lee, Wen-Show