[Exclusive] Jool Labs Korea Undergoes Large-Scale Restructuring... CEO Replaced and Over 70% Workforce Cut

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Lee Seung-jae, CEO of Jule Labs Korea, speaking at a press conference held last May at Urban Source in Seongsu-dong, Seoul, to commemorate the domestic launch of Jule.

[Asia Economy Reporter Choi Sunghye] Juul Labs Korea is replacing its CEO and cutting more than 70% of its workforce as part of a large-scale restructuring. Following the controversy over the harmfulness of liquid e-cigarettes in the U.S., Juul Labs' home country, Juul Labs Korea began restructuring after suffering setbacks when similar issues arose domestically in December last year.

According to industry sources on the 6th, Juul Labs Korea plans to replace its CEO within this month. The current CEO, Lee Seungjae, formerly the head of SC Johnson Korea, the Korean branch of the global consumer goods company SC Johnson, has led Juul Labs Korea since its establishment in December 2018. However, he will step down less than a year after Juul's official launch in Korea in May last year.

Source: Korea Fair Trade Commission

According to the Fair Trade Commission's business registration status check on the same day, the representative of Juul Labs Korea LLC has been changed to Jung Jooyoung. However, Jung is known to be part of Juul Labs Korea's legal team rather than the new CEO. An industry insider said, "Juul Labs Korea is currently searching for a new CEO."

Juul Labs Korea has also selected more than 70 employees, including headquarters and sales staff, out of about 100 employees for restructuring and is expected to reduce its workforce. Following the suspension of convenience store sales last month, the company closed three offline flagship stores?Serosu-gil, Gwanghwamun, and Yeonnam branches?starting from the 8th. However, it plans to resume resale of 'Juul Pod Classic' and 'Juul Pod Fresh' mainly at convenience stores in Seoul, Gyeonggi, and Incheon areas within this month.

In January, Juul Labs Korea issued a statement on the Korean market and business plans, stating, "We are currently reviewing the best ways to reorganize business operations regionally in each country where we operate and making individual adjustments by region. We are also reviewing our business operations and strategies in Korea."

Meanwhile, according to the Ministry of Food and Drug Safety, Juul Labs Korea recently sent an official letter requesting a meeting to discuss tobacco analysis methods. According to the Ministry's analysis results of harmful substances in liquid e-cigarettes announced in December last year, 0.8 ppm (mg/kg) of vitamin E acetate was detected in Juul Labs' 'Juul Pod Crisp.' This substance is considered a harmful agent suspected of causing lung damage by the U.S. Centers for Disease Control and Prevention (CDC). At that time, Juul Labs stated, "We have not used vitamin E acetate as an ingredient in any of our products," and "We will actively communicate with relevant authorities regarding the overall testing methods and analysis results conducted by the Ministry." The proposal for this meeting was made in the same context.