Fines of up to VND 140 million imposed on acts of misguided advertising and promotion

The Government promulgated Decree no. 71/2014/ND-CP dated July 21, 2014 detailing Law on Competition handling violation in competition domain.

Quang cao gian doi

Accordingly, since September 15, 2014, enterprises are subject to a fine of from VND 60 million to 80 million for imitating other advertising products to mislead clients, comparing their products or services directly with those of the same kind of other enterprise, VND from 80 million to 140 million for using misguided advertising on price, quantity, quality, utility, warranty time etc.

Another notable point is the Decree increases fines imposed on acts of promotion for unfair competition and violation on multi-level sale. Accordingly, since September 15, 2014, a fine of between VND 50 million to 80 million, increasing by VND 45 million to 55 million from previous fines, is applied to acts of promotion giving false information on prizes or products to mislead clients. For enterprises paying the multi-level salespeople the totally annual commission, bonus and other financial benefits which exceed the 40% of the turnover of such year of the multi-level marketing companies, enterprises asking salespeople to deposit or buy products to participate in the network, a fine from VND 40 million to VND 60 million and from VND 60 million to VND 100 million will be applied respectively.

Since September 15, 2014, an enterprise whose combined market share in the relevant markets is at least 30 % shall be fined up to 10% of its turnover of the financial year before the year in which one of these following violations is committed: Agreement on a fixed price for some or all goods; Agreement to reduce or raise the price at a specific rate; Exclusive dealing and market division, agreement to limit production and sales..

This fine also applied to enterprises committing following violations: Imposing the sale prices for goods and services, which causes damage to the customers; Imposing the quantity of supplied goods and services to create the scarcity in the market; Bid rigging; Agreement to prevent other enterprises from getting into market or developing business, etc.

This Decree takes effect from September 15, 2014.

Source: Ministry of Industry and Trade Website