Regulator to scrutinize new forms of unfair practices in online retail

Building materials added as dealership probe expands to 22 industries

Results due in November; findings to inform policy reform and ex officio investigations

The Korea Fair Trade Commission will for the first time examine trade dependency, trade concentration and operating profit margins to assess the fairness of trading structures in the retail and dealership sectors.

The regulator also plans to investigate new types of unfair trade practices emerging in the online retail market, with the findings to serve as the basis for future policy reform, ex officio investigations and wider adoption of standard contracts.

The Korea Fair Trade Commission at the Government Sejong Complex in Eosin-dong, Sejong. [Newsis]
The Korea Fair Trade Commission at the Government Sejong Complex in Eosin-dong, Sejong. [Newsis]

The Fair Trade Commission said Monday it would conduct a written survey covering overall trading activity in the retail and dealership sectors for 2025.

The retail portion of the survey will cover 7,600 suppliers and store tenants doing business with 43 retail brands across nine retail formats, while the dealership portion will target 521 suppliers and 50,000 dealerships across 22 industries.

To assess the bargaining power of suppliers and dealerships, the commission will examine how diversified their trading partners are and how concentrated their transactions are. Specifically, it will look at the number of large-scale retailers and suppliers each party deals with, as well as the share of the top three trading partners in total transaction volume.

Operating profit margins will also be surveyed for the first time to gauge the actual business conditions of the weaker parties in these trading relationships. The aim is to determine how improvements in trading practices have affected business performance.

For suppliers dealing with online retailers, the commission plans to document cases of unfair practices and types of harm that have not been adequately captured under the existing legal framework.

The nine retail formats covered include hypermarkets and super-supermarkets, convenience stores, department stores, duty-free shops, TV home shopping channels, online shopping malls, outlet and complex malls, T-commerce operators and specialty retailers. Online shopping mall operators included in the survey are Coupang Inc, Kakao Gift, SSG.com, Kurly and Musinsa.

In the dealership sector, building materials will be included as a survey subject for the first time this year. The commission expanded the number of covered industries from 21 to 22, citing an expected increase in building materials transactions as reconstruction and redevelopment projects pick up.

The dealership survey will also examine respondents' experiences with specific types of unfair trade practices, including forced purchases, demands for financial benefits, compulsory sales targets, imposition of disadvantages, interference in business operations, refusal or evasion of order confirmation requests, and retaliatory measures.

The survey will capture recent trading conditions, experiences with unfair practices, perceived improvements in trading norms and the use of standard trade contracts. Suppliers and dealerships that provide detailed accounts of unfair trade practices will be invited for in-depth interviews.

The retail survey runs through Aug. 21, and the dealership survey through Sept. 8. The commission will spend roughly three months analyzing the results before releasing its findings in November. The results will feed into policy work, including identifying areas for regulatory reform, expanding the use of standard contracts and drawing up plans for ex officio investigations.


y2k@heraldcorp.com