(Shingō: National Trade Law)

# P.R. 0924

**Chapter 1: The National Trade Commission**

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> * **(a)** The National Trade Commission is hereby established, which shall be composed of five commissioners, who shall be appointed by the Prime Minister, by and with the advice and consent of Parliament. Not more than three of the commissioners shall be members of the same political party. The first Commissioners appointed shall continue in office for terms of three, four, five, six, and seven years, respectively, but their successors shall be appointed for terms of seven years, except that any person chosen to fill a vacancy shall be appointed only for the unexpired term of the Commissioner whom he shall succeed: Provided, however, That upon the expiration of his term of office a Commissioner shall continue to serve until his successor shall have been appointed and shall have qualified. The Prime Minister shall choose a chairman from the Commission’s membership. No Commissioner shall engage in any other business, vocation, or employment. Any Commissioner may be removed by the Prime Minister for inefficiency, neglect of duty, or malfeasance in office. A vacancy in the Commission shall not impair the right of the remaining Commissioners to exercise all the powers of the Commission.
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**Chapter 2: Declarations of Unlawfulness**

> **§1)** Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful.
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> **§2)** The Commission is hereby empowered and directed to prevent persons, partnerships, or corporations, except banks, savings and loan institutions, Federal credit unions, from using unfair methods of competition in or affecting commerce and unfair or deceptive acts or practices in or affecting commerce.
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> **§3)** This chapter shall not apply to unfair methods of competition involving commerce with foreign nations (other than import commerce) unless—
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> * **(a)** such methods of competition have a direct, substantial, and reasonably foreseeable effect—
> 	+ **(1)** on commerce which is not commerce with foreign nations, or on import commerce with foreign nations; or
> 	+ **(2)** on export commerce with foreign nations, of a person engaged in such commerce in the Imperial Republic of Shingō.
> * **(b)** such effect gives rise to a claim under the provisions of this chapter, other than this section.
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> **§4)**
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> * **(a)** For purposes of Chapter 2, the term “unfair or deceptive acts or practices” includes such acts or practices involving foreign commerce that—
> 	+ **(1)** cause or are likely to cause reasonably foreseeable injury within the Imperial Republic of Shingō; or
> 	+ **(2)** involve material conduct occurring within the Imperial Republic of Shingō.
> * **(b)** All remedies available to the Commission with respect to unfair and deceptive acts or practices shall be available for acts and practices described in this paragraph, including restitution to domestic or foreign victims.
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**Chapter 3: Proceeding by Commission**

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> * **(a)** Whenever the Commission shall have reason to believe that any such person, partnership, or corporation has been or is using any unfair method of competition or unfair or deceptive act or practice in or affecting commerce, and if it shall appear to the Commission that a proceeding by it in respect thereof would be to the interest of the public, it shall issue and serve upon such person, partnership, or corporation a complaint stating its charges in that respect and containing a notice of a hearing upon a day and at a place therein fixed at least thirty days after the service of said complaint.
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> * **(b)** The person, partnership, or corporation so complained of shall have the right to appear at the place and time so fixed and show cause why an order should not be entered by the Commission requiring such person, partnership, or corporation to cease and desist from the violation of the law so charged in said complaint. Any person, partnership, or corporation may make application, and upon good cause shown may be allowed by the Commission to intervene and appear in said proceeding by counsel or in person. The testimony in any such proceeding shall be reduced to writing and filed in the office of the Commission. If upon such hearing the Commission shall be of the opinion that the method of competition or the act or practice in question is prohibited by this subchapter, it shall make a report in writing in which it shall state its findings as to the facts and shall issue and cause to be served on such person, partnership, or corporation an order requiring such person, partnership, or corporation to cease and desist from using such method of competition or such act or practice. Until the expiration of the time allowed for filing a petition for review, if no such petition has been duly filed within such time, or, if a petition for review has been filed within such time then until the record in the proceeding has been filed in a court of appeals of the Imperial Republic of Shingō, as hereinafter provided, the Commission may at any time, upon such notice and in such manner as it shall deem proper, modify or set aside, in whole or in part, any report or any order made or issued by it under this section. After the expiration of the time allowed for filing a petition for review, if no such petition has been duly filed within such time, the Commission may at any time, after notice and opportunity for hearing, reopen and alter, modify, or set aside, in whole or in part any report or order made or issued by it under this section, whenever in the opinion of the Commission conditions of fact or of law have so changed as to require such action or if the public interest shall so require, except that (1) the said person, partnership, or corporation may, within sixty days after service upon him or it of said report or order entered after such a reopening, obtain a review thereof in the appropriate court of appeals of the Imperial Republic of Shingō, in the manner provided in subsection (c) of this section; and (2) in the case of an order, the Commission shall reopen any such order to consider whether such order (including any affirmative relief provision contained in such order) should be altered, modified, or set aside, in whole or in part, if the person, partnership, or corporation involved files a request with the Commission which makes a satisfactory showing that changed conditions of law or fact require such order to be altered, modified, or set aside, in whole or in part. The Commission shall determine whether to alter, modify, or set aside any order of the Commission in response to a request made by a person, partnership, or corporation under §2 not later than 120 days after the date of the filing of such request.
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> **§2)**
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> * **(a)** Any person, partnership, or corporation required by an order of the Commission to cease and desist from using any method of competition or act or practice may obtain a review of such order in the court of appeals of the Imperial Republic of Shingō, within any circuit where the method of competition or the act or practice in question was used or where such person, partnership, or corporation resides or carries on business, by filing in the court, within sixty days from the date of the service of such order, a written petition praying that the order of the Commission be set aside. Upon such filing of the petition the court shall have jurisdiction of the proceeding and of the question determined therein concurrently with the Commission until the filing of the record and shall have power to make and enter a decree affirming, modifying, or setting aside the order of the Commission, and enforcing the same to the extent that such order is affirmed and to issue such writs as are ancillary to its jurisdiction or are necessary in its judgement to prevent injury to the public or to competitors pendente lite. The findings of the Commission as to the facts, if supported by evidence, shall be conclusive. To the extent that the order of the Commission is affirmed, the court shall thereupon issue its own order commanding obedience to the terms of such order of the Commission. If either party shall apply to the court for leave to adduce additional evidence, and shall show to the satisfaction of the court that such additional evidence is material and that there were reasonable grounds for the failure to adduce such evidence in the proceeding before the Commission, the court may order such additional evidence to be taken before the Commission and to be adduced upon the hearing in such manner and upon such terms and conditions as to the court may seem proper. The Commission may modify its findings as to the facts, or make new findings, by reason of the additional evidence so taken, and it shall file such modified or new findings, which, if supported by evidence, shall be conclusive, and its recommendation, if any, for the modification or setting aside of its original order, with the return of such additional evidence. The judgment and decree of the court shall be final, except that the same shall be subject to review by the Supreme Court.
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**Chapter 4: Monopolization of Trade**

> **§1)** Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce within the Imperial Republic of Shingō, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine, or by imprisonment not exceeding three years, or by both said punishments.
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**Chapter 5: Prohibition of Pyramid Promotional Schemes**

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> * **(a)** It shall be unlawful for any person to establish, operate, promote, or cause to be promoted a pyramid promotional scheme.
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> * **(b)** Any person who establishes, operates, promotes, or causes to be promoted any plan or operation which sells or solicits the sale of consumer products or services in the home or otherwise than in a permanent retail establishment, and which sells products or services directly or indirectly to independent salespeople, shall be required to have previously obtained a bona fide inventory repurchase agreement.
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> * **(c)** Nothing in this Act may be construed to prohibit a plan or operation, or to define a plan or operation as a pyramid promotional scheme, based upon the fact that participants in the plan or operation give consideration in return for the right to receive compensation based upon purchases of goods or services or intangible property by participants for personal use, consumption, or resale so long as the plan or operation does not require inventory loading and the plan or operation implements a bona fide inventory repurchase agreement.
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> * **(d)** A violation of subsection (a) or (b) shall be treated as an unfair or deceptive act or practice in or affecting commerce under Chapter 2.
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> **§2)** ‘Bona fide inventory repurchase agreement’ means a program by which a plan or operation—
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> * **(a)** promises to repurchase, on commercially reasonable terms, current and marketable inventory purchased and maintained by a participant for use, consumption, or resale, upon request at the termination of the participant’s business relationship with the plan or operation; and
> * **(b)** clearly communicates such terms in its recruiting literature, sales manual, or contracts with participants, including the manner in which the repurchase is to be exercised and disclosure of any inventory not eligible for repurchase under the program.
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