The Fair Trade Commission has confirmed that it has begun on-site investigations into Baemin and Coupang Eats, who are suspected of coercing member companies into providing 'most-favored-nation' treatment by matching discount conditions to the same level as other delivery apps.
According to the industry, Fair Trade Commission researchers visited the headquarters of Baemin and Coupang Eats located in Songpa District, Seoul, on this day to secure documents. Baemin and Coupang Eats are ranked 1st and 2nd in the delivery app industry, respectively. As of last December, based on estimated payment amounts, the combined market share of Baemin (58%) and Coupang Eats (36%) reached 94%. 'Most-favored-nation' treatment refers to the practice of requiring the conditions (price, discount rate, commission, marketing benefits, etc.) provided to the trading partner to be no less favorable than those offered to any other trading partner.
Baemin and Coupang Eats have been under investigation by the Fair Trade Commission since September of last year for allegedly requiring member store owners to set discount conditions no less favorable than those of competitors or to favor themselves the most. The Fair Trade Commission also conducted an on-site investigation of both companies last May.
The Fair Trade Commission is reported to harbor suspicions that these companies have abused their market-dominant positions. They are said to be considering the application of unfair transaction acts as well.
Some in the industry interpret this as a follow-up measure after the agreement was rejected. The Fair Trade Commission is coordinating a settlement plan including corrective measures with the two companies, but this settlement has reportedly not materialized. Therefore, it is seen that the Fair Trade Commission has initiated additional document collection and fact-finding before finalizing the level of sanctions and legal composition.
If violations of market-dominant position abuse under the Fair Trade Act are recognized, a penalty surcharge of up to 6% of the related sales can be imposed.
A Fair Trade Commission official stated, 'I cannot confirm the investigation of individual cases or specific details,' adding, 'If unfair transaction acts are confirmed, we will take stern action in accordance with relevant laws.' Baemin and Coupang Eats have reportedly not provided a specific response regarding the investigation.