HK distributor of popular Taiwanese bubble tea brand Xing Fu Tang shocks customers by suddenly shutting store amid bitter court battle with founding firm

03-Jan-2019 Intellasia | South China Morning Post | 6:00 AM Print This Post

The Hong Kong distributor of a popular Taiwanese bubble tea brand shocked customers on Tuesday, announcing it would close its Causeway Bay store from Wednesday amid a bitter court battle with the founding company over copyright infringement.

“Thank you everyone for your unfailing support. Tenpence International Limited’s Causeway Bay store will officially cease to operate from January 2, 2019,” it said on its Facebook page on Tuesday morning.

Taiwanese brand Xing Fu Tang is popular for its brown sugar bubble milk tea, which is made with stir-fried black tapioca pearls.

Since its founding in January 2018, more than 60 Xing Fu Tang franchise stores have opened in Taiwan and cities such as Hong Kong, Shenzhen, Manila and Vancouver.

The Hong Kong distributor, Tenpence, opened its store in Causeway Bay in August. Two franchise stores, in Yuen Long and Tsim Sha Tsui, followed.

The sudden announcement came after Taiwanese founding firm CEO International applied to a Hong Kong court for an immediate ban to temporarily halt the operations of all stores run by Tenpence in the city.

Staff at the Causeway Bay store would not comment on the closure or ban. One employee said only that they would close as usual at 11pm. Tenpence and the two other franchise stores have not responded to the Post’s inquiries.

The legal battle started with Tenpence suing the Taiwanese firm in November, saying that under its contract, it was the bubble tea brand’s sole local distributor. It was upset that CEO International wanted to set up its own stores in Hong Kong and asked the court to bar such a move.

But when CEO International sought the injunction against Tenpence last Friday, Justice David Lok described the Taiwanese firm’s case as strong.

He gave Tenpence until Thursday to consider its defence, noting that the ban could mean a “drastic” change leading to all three shops in Hong Kong being shut down.

Edison Chen, founder of the brand, said he got a notice on Monday that the company was now being sued in Taiwan by Tenpence over a breach of contract, but declined to elaborate on the details.

“On the one hand, they are closing the store, on the other hand, they are suing us in Taiwan,” Chen said. “I don’t know what they want to do.”

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About 20 customers were seen outside the Causeway Bay store on Tuesday afternoon, with some waiting for their orders and others taking selfies with their drinks.

Most of the local customers knew about the legal disputes but were shocked to learn about the closure.

A Hongkonger surnamed Lau said it was her first visit to the store.

“I want to try and compare it with the Taiwan bubble tea later. I know the Taiwan company applied for a ban, but didn’t know it would close that soon,” she said.

A tourist surnamed Zhong from mainland China said he had the bubble tea at the Tsim Sha Tsui store on Monday. “I liked the taste so we came again,” he said.


Category: Hong Kong

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