Wed, Aug 28, 2013 - Page 3 News List

Consumer group slams Top Pot refund

By Alison Hsiao  /  Staff reporter

The Top Pot Bakery incident has again highlighted the deficiencies in the nation’s food monitoring system and consumer protection mechanisms, the Consumers’ Foundation said yesterday.

Under this flawed system, food companies are rarely deterred by potential penalties and are given easy options on refunds if they do commit a transgression, the foundation said.

The bakery chain has been accused of employing deceptive advertising by claiming to sell all-natural products even though it used artificial flavoring.

Taipei City’s Department of Health said in a report on Friday last week that used nine types of artificial flavoring and fined the company NT$180,000 (US$6,000) for false advertising in accordance with the Act Governing Food Sanitation (食品衛生管理法).

However, the foundation said the city should have determined the fine based on the Fair Trade Act (公平交易法), which sets a maximum fine of NT$25 million, instead of saying that the food act — which stipulates a top fine of NT$200,000 — takes precedence over the fair trade law.

A NT$180,000 fine is a drop in the bucket for Top Pot, which generates an annual revenue of about NT$600 million, the foundation said.

The light punishments handed to dishonest businesses are proof that there are loopholes in the system, it said.

The Taipei City Government requested that Top Pot pay triple the amount spent by each customer seeking a refund as compensation, but the company refused. It will instead reimburse customers for the cost of the item purchased and give them a gift certificate for 25 percent of the total amount they spent on Top Pot baked goods.

“The refund and gift coupon are only available for those who can present proof of purchase — receipts or credit card statements. Consumers are required to register to be reimbursed and requests will not be processed until Oct. 1,” foundation secretary-general Lei Li-fen (雷立芬) said.

The foundation said that previous food scandals have shown that most customers have already consumed the offending products and do not have proof of purchase, which makes it difficult to quantify the required compensation.

“The burden of proof should not be borne by the consumers,” foundation board member Hsieh Tien-jen (謝天仁) said. “It is the company who has the complete records of the amount of substandard products it sold.”

“The Taipei City Government’s proposal to file a joint lawsuit against the company not only oversimplifies the issue, but such lawsuits in these types of food scandals are nearly impossible to file,” Hsieh said. “

In addition, filing a lawsuit is not cost-effective, Lei said.

“Few people can provide proof of purchase and a civil suit seeking financial compensation, which requires both time and manpower, would only achieve a minor settlement,” Lei said.

Hsieh said the foundation has repeatedly called for the establishment of a Consumer Protection Fund, which would be funded by the fines paid by or illegal profits seized from the companies by the Ministry of Justice or consumer protection groups.

Only a robust customer protection mechanism can ensure that businesses that break law are held fully accountable and serve as an effective deterrent, the foundation said.

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