RT-Mart to be fined for sparking run on toilet paper

STINKY BUSINESS: The announcement that toilet paper prices would surge by up to 30 percent had no basis and was in violation of the Fair Trade Act, the FTC said

Staff writer, with CNA





The Fair Trade Commission (FTC) yesterday said it is to fine hypermarket chain operator RT-Mart International Ltd (大潤發) NT$3.5 million (US$119,629) for spreading misleading information about a planned toilet paper price hike that led to a sudden imbalance of supply and demand last month.

Some of the nation’s major hypermarket operators, including Carrefour Taiwan (家樂福) and RT-Mart, late last month announced they were informed by toilet paper makers that prices would be raised by up to 30 percent in the middle of this month at the earliest, citing a spike in international pulp prices.

The announcement spurred people to stock up on toilet paper, emptying store shelves.

The commission convened a forum to promote competition and prevent price gouging, which was attended by representatives from three major toilet paper suppliers and five leading hypermarket chains.

The commission on March 1 began a series of meetings with suppliers and retailers to look into the massive run on the product and allegations of price-fixing.

The commission determined that RT-Mart’s misleading announcement violated the Fair Trade Act’s (公平交易法) provisions banning market manipulation.

A probe by the commission found that RT-Mart had issued a statement to media outlets on Feb. 23 announcing the purported price increase ahead of a Feb. 23 to Feb. 27 promotional campaign for toilet paper, FTC Deputy Chairman Perng Shaw-jiin (彭紹瑾) said.

The probe investigated not only whether the price hikes were intentional, but also whether distribution channels conspired with suppliers to cause a price increase, he said.

The commission found that upstream suppliers did not negotiate with RT-Mart on the purported price hike and there is no evidence of a 30 percent price hike, he added.

RT-Mart said it would refrain from talking about the issue until it receives the FTC’s ruling.