The government has promised to take steps to curb ticket scalping for entertainment events. The Cultural and Creative Industry Development Act (文化創意產業發展法) would be amended to discourage and prevent the use software algorithms to purchase tickets in bulk for resale, Minister of Culture Shih Che (史哲) said on Monday.
The issue was raised on Wednesday last week when legislators cited public complaints of tickets being unavailable for a concert by K-pop girl group Blackpink, who performed in Kaohsiung last weekend.
It is good that the ministry is moving so fast on the issue, but more comprehensive legislation that addresses all forms of product hoarding and scalping is needed. For example, after years of complaints about train ticket scalping, an amendment to the Railway Act (鐵路法) was passed in 2016, raising the maximum penalty to five years in prison and/or a NT$3 million (US$98,837) fine.
The revised law appears to have curbed the scalping and hoarding of train tickets, but the practice still affects other goods and services.
As with elsewhere in the world, some goods became scarcer in Taiwan during the height of the COVID-19 pandemic, when production fell due to lockdowns. For example, Sony PlayStation 5 and Xbox Series SX consoles seemed impossible to buy at the manufacturers’ suggested retail price for two years after their introduction in November 2020. Scalpers sold the systems for several times the suggested price through Facebook Marketplace and other platforms.
While a video game console is not a necessity, neither is a concert ticket. Necessity is not the point. Scalping forces people to pay more for something without increasing profit for the producer. This limits the potential for cross-selling and affects customer retention, which have large economic impacts.
The practice also excludes people who are unable or unwilling to pay the heavily marked up cost of a scalped item or service. This means a smaller customer base for a console manufacturer, meaning a decrease in game sales, accessories and online services. With a concert, it means lost revenue for food vendors, accommodation providers and other businesses that would benefit from the event.
Scalping can even affect some commodities, as the current egg shortage has shown. As people hoarded eggs, others were unable to purchase any. Such circumstances also create the potential for unscrupulous resellers to raise prices.
The government should pass a comprehensive law that prevents any form of overbuying, either for hoarding or profit. The challenge with such legislation is that it becomes necessary for a judge to determine the appropriate amount of a product that a person should be allowed to purchase.
However, judges are already required to make such subjective decisions, such as what constitutes an insult in a criminal defamation case.
Having one law that handles all forms of overbuying could eliminate the need for lawmakers to reinvent the wheel every time there is an egregious case of scalping that garners public attention. It is also unnecessary for lawmakers to revisit the issue every time scalpers find a new technology to exploit.
Whether they use algorithms or other means, people who overbuy and resell should be brought to justice.
Scalping and hoarding are harmful to the economy and to the interests of individuals. Such practices can even be socially destabilizing when necessities are involved and should be stamped out once and for all.
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