Cannot “Give Customers and Selling Prices” to Medical Device Companies’ Agency

FTC standard agency contract enacted… Prohibition of forcing exclusive transactions at home appliance stores and gas stations

Fair Trade Commission (CG)
Fair Trade Commission (CG)

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(Sejong = Yonhap News) Reporter Chae Yeon = Medical device supplier (head office) is prohibited from asking the agency to provide trade secrets such as customer status and sales price without a reasonable reason.

The Fair Trade Commission announced on the 30th that it has established a standard agency contract for medical devices, home appliances, and oil distribution industries.

◇ 4 years guarantee for medical device agency and gas station contract… 3 years for home appliance dealership

Although the standard contract is not obligatory to use, the use of the standard contract occupies the largest distribution point (20 points out of 100) when evaluating the implementation of the fair trade agreement in the agency field, which is highly incentive to use.

In common with the three industries, the contract prohibits unreasonable refusal of delivery by suppliers, and in the event of refusal of delivery, the contract specifies the details that allow the agency to confirm the reason with the supplier.

In disasters and crises such as the novel coronavirus infection (Corona 19), delayed interest due to payment was reduced or exempted through consultation so that suppliers and agencies can share the risk.

The right to request contract renewal was guaranteed for four years for the medical device and oil distribution industry and three years for the home appliance industry. In the absence of special circumstances, the supplier must accept the renewal request.

When a supplier opens a new agency, it is stipulated that the adjacent local agency is notified in advance, and the promotional event is to share the cost.

◇ Prohibition of requests to provide’trade secrets’ to medical device headquarters and agencies

The medical device industry prevented suppliers from requesting trade secrets or personal information such as customer status and selling prices without a reasonable reason from the agency.

In the event that the agency legitimately refused the request for information, it was also prohibited for the supplier to terminate the contract.

As a result of the survey, 14.6% of agencies answered that they have been asked to provide information on selling prices.

If the request to provide information is not prohibited, there is a concern that the supplier may commit unfair acts to the agency with the information obtained using the location of’A’.

This is a method such as receiving information on the current status of the agency’s business partner and taking the customer and then terminating the agency contract, or by receiving the sale price information, slapping the supply price based on the margin rate and selling directly at a lower price than the agency.

Prohibition of rebate provision and the right to request adjustment of supply price from agencies were also specified in the contract.

◇ If the price of a home appliance retailer or directly managed store is cheaper, you can request to adjust the supply price

The home appliance industry banned the forcing of exclusive transactions. This means that it prevents suppliers from forcing their agents to sell products from other companies without a reasonable reason.

When the price to which the agency is supplied is higher than the selling price of online shopping malls and directly managed stores, it is possible to request a supply price adjustment.

If the quoted price of the interior contractor designated by the supplier was excessively high, the agency requested a change in the contractor and made it possible to select itself.

Petroleum distribution industries such as gas stations were also prohibited from compelling exclusive transactions.

When the supply price fluctuates after ordering a product, the right to request confirmation was stipulated so that the agency can check the details.

The supplier’s support matters for agency funds, facilities, and computer systems are set in separate contracts or agreements, and when the agency fully repays the support-related debt, the contract can be canceled.

It was specified that the cost of removal for trademark/mutual use and termination of the contract should be determined by consultation.

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