"17-Year Exclusive... Damaged by Unfair Contract" EXO Member Files Complaint Against SM with Fair Trade Commission

Chen Baek-si "Request for Full Investigation of Affiliated Celebrities"
SM "Provided Settlement Copies... No Impact on EXO Activities"

Group EXO members Baekhyun (Byun Baekhyun), Xiumin (Kim Min-seok), and Chen (Kim Jong-dae) have filed a complaint against SM Entertainment (SM), with whom they are in conflict over exclusive contracts, to the Fair Trade Commission (FTC) for abuse of superior bargaining position. SM announced that it would provide copies of settlement documents.

On the 5th, Lee Jae-hak, a lawyer from Law Firm Lin representing EXO members Baekhyun, Xiumin, and Chen, stated in a press release, "We filed a complaint against SM with the Fair Trade Commission (FTC) through the National Petition Electronic Submission system yesterday."

EXO ChenBaekXi Photo by SM Entertainment

They claimed, "The FTC's corrective orders previously issued to SM were not reflected at all in the unfair contracts, resulting in continuous damage caused by SM's abuse of its superior bargaining position."

The lawyer explained, "Despite the FTC issuing corrective orders to SM twice in October 2007 and January 2011, we reported that SM blatantly ignored these orders and continued unfair contract practices."

They pointed out that although the FTC's 2007 decision judged the contract period of "five years from debut date (not contract date)" to be excessively long, SM set the exclusive contract period to seven years in the main contract and added an additional three years in a supplementary agreement (to prepare for overseas activities), thereby concluding an even more unfair contract.

They requested "a strict investigation and prompt corrective measures regarding SM's violations, and furthermore, a full investigation into the exclusive contracts of all SM artists."

Earlier, the three EXO members sent certified letters requesting settlement data and copies of settlement grounds to SM seven times since March, but SM maintained a stance of "cannot provide," leading them to notify the termination of their exclusive contracts.

They also criticized SM for signing long-term contracts exceeding 12 to 13 years with artists and then having them sign subsequent exclusive contracts, resulting in contract periods of at least 17 or 18 years.

SM exterior [Photo by Yonhap News]

On the same day, SM announced through a press release that it would provide copies of the settlement documents.

SM stated, "After careful consideration, we intend to provide copies of the settlement documents on the condition that the three members and their representatives confirm they will not use the copies for any improper purposes other than reviewing the details." They added, "We have also explained this situation to other EXO members and sought their consent or understanding."

However, SM expressed concern, saying, "Given reports of third-party involvement from various sources, although the representatives of the three artists have opportunities to visit our company anytime to review the settlement documents and provide feedback, we are worried that their insistence on copying the documents and even mentioning contract termination may have other improper motives."

They further added, "Internally, there are growing concerns about whether the representatives of the three can be trusted and whether there is no third-party involvement despite numerous reports and circumstances."

Regarding the future activities of group EXO, SM stated, "We want to make it clear that a contract cannot be terminated solely based on unilateral notifications lacking sufficient grounds," and added, "We will continue to do our best to negotiate with the three artists whom we value greatly. We will also do our utmost to ensure that EXO's activities, which fans look forward to, are not disrupted."

Meanwhile, EXO debuted in 2013 as a 12-member male idol group, gaining worldwide popularity by establishing sharp choreography and a unique worldview. Baekhyun, Xiumin, and Chen also promoted as the unit group ChenBaekXi.