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Samsung fined NT$10 million for misleading advertising

2013/10/24 16:20:10

Taipei, Oct. 24 (CNA) The Taiwan branch of Samsung Electronics Co. was fined NT$10 million (US$340,000) Thursday by Taiwan's Fair Trade Commission (FTC) for using an advertising campaign that gave misleading impressions about consumers' views on Samsung and its rivals, including HTC Corp., on local online forums.

The South Korean electronics giant's campaign consisted of Internet posts purported to be from satisfied customers praising Samsung at the expense of its rivals' products, which is in violation of fair trade rules, the FTC said in a statement.

OpenTide Taiwan Co. and Sales and Profit International Co., the marketing companies hired by Samsung Taiwan to make the posts, were fined NT$3 million and NT$50,000, respectively, by the commission.

FTC officials said Samsung can file an administrative appeal within one month of receiving its disciplinary citation, a process likely to take up to six months before a final ruling is delivered.

"Samsung Taiwan feels deep regret over the FTC's decision. Our company adheres to transparent and honest communications with consumers," the South Korean firm told CNA.

"Samsung Taiwan will carefully examine the FTC's decision and take appropriate action to protect our company's reputation and express our respect for consumers," it added.

HTC said it is disappointed that a competitor would resort to misleading consumers to discredit its innovation, citing its chairwoman, Cher Wang, as saying that "integrity" is the most important value in a company.

The allegations came to light after Internet users in Taiwan disclosed April 1 that Samsung's local agent had hired students to write articles attacking HTC and recommending Samsung phones instead.

Samsung Taiwan responded April 5 on its Facebook page that the company had ceased all Internet marketing that involves the posting of anonymous comments and apologized for "any inconvenience and confusion from the Internet event."

Samsung was also fined NT$300,000 by the FTC in January this year for a misleading advertisement about the camera functions on Samsung's Galaxy Y Duos GT-S6102 phone.

According to market survey results, HTC and Samsung continue to dominate the list of the best-selling phones in Taiwan, along with other models from Sony Corp. of Japan, Apple Inc. of the United States, Nokia of Finland and Asustek Computer Inc. of Taiwan.

(By Jeffrey Wu)