The applicability of Fair Trade Law on the Transaction behavior of Textbook and Reference Book Market in the Elementary School

Abstract

Since the first stage (semi-deregulation) of textbook publications for elementary schools in 1991, certain policy results have demonstrated the changes in market structure. These changes included pluralization and liberalization of education thoughts, enhancement on the quality of textbook writing and printing, better choices of textbooks and supplementing materials, and the autonomy of teachers' rights in academic affairs. On the other side of coins, some side effects have also called for attentions from the perspective of Fair Trade Law (FTL). These effects are the further concentration of publishing firms, the cross-subsidization between textbooks and reference books, the unfair sales promotion practices at schools, and the coalition behavior in publishing firms as well as the municipal governments.

This study is commissioned to look into these side effects in order to assess their impacts within the scope of FTL when fully deregulated in 2002. Data collections are based upon: (i) sampling survey of parents and teachers, (ii) in-depth interview of publishing firms, (iii) both interview and survey of educational bureaus at municipal government, and (iv) panel discussion from government, publishing firms, and teacher representatives. Research methodology is comprised of three parts: historical analysis, industry analysis, and legal assessment. Research findings are (a) further concentration of the market, (b) further decentralization of buyers at schools, (c) more transparency in the procurement process, (d) sales support (ex ante and ex post) demanding regulation, and (e) relevancy of Fair Trade Law and litigation cases. Finally, suggestions are made to call for implementation of National Education Law at the municipal level, modification on the pricing negotiating mechanism, strengthening the regulation of sales promotion activities under the FTL, and proposal for separation of textbook and reference book market.