Taiwan Fair Trade Commission Investigates Samsung's False Online Promotion

Global news agency AFP reports that Taiwanese authorities have launched an investigation into allegations that South Korean consumer electronics giant Samsung hired students to post malicious comments online against Taiwanese smartphone manufacturer HTC Corp., a fierce competitor in the cell phone market.

Taiwan’s Fair Trade Commission spokesman Sun Lih-chyun told AFP, "The case was set up last week after we received complaints." He said the probe would look into allegations that Samsung engaged in false advertising and that if the allegations were upheld, Samsung and its local advertising agent could face a fine of up to Tw$25 million (US $840,000).

According to a report by Taiwan’s United Evening News, Internet users have complained this month that Samsung, through its local agent, hired students to write online articles attacking HTC and recommending Samsung cell phones.

However, as per the report, officials at Samsung Taiwan said the company is not aware of any such investigation by the Fair Trade Commission. But, in a statement on its Facebook page, the Korean consumer giant said that it regretted "any inconvenience and confusion from the Internet event."

Meanwhile, Samsung Taiwan said that it has halted all Internet marketing, such as posting articles on websites. The AFP report indicates that Samsung was fined Tw$300,000 (US $10,042) by the Commission early this year for a misleading advertisement about the camera functions on Samsung's Galaxy Y Duos GT-S6102. This information was obtained from Taiwan's State Central News Agency.

According to research firm IDC, Samsung held a 30.3 percent share of the global smartphone market in 2012, while Apple had 19.1 percent and HTC 4.6 percent. Also, IDC report shows that more smartphones are forecast to be shipped globally than feature phones in 2013. The firm’s worldwide quarterly mobile phone tracker indicates that vendors will ship 918.6 million smartphones this year, or 50.1 percent of the total mobile phone shipments worldwide.