Indication of Supply Suspension and Termination of Transactions for Non-Compliant Companies
On the 2nd, the Korea Fair Trade Commission (KFTC) imposed a corrective order on Pulmuone Health & Living for designating minimum resale prices to retailers selling air fryers and other products, and forcing them to comply with those prices.
According to the KFTC, from July 2022 to June 2023, Pulmuone Health & Living supplied air fryers manufactured through an Original Equipment Manufacturer (OEM) method to three retail clients, and forced them not to sell below the resale prices set by Pulmuone Health & Living.
Pulmuone Health & Living continuously monitored the retailers' selling prices and, upon detecting any violation of the minimum resale price, demanded price increases or requested that the products be excluded from portal search results. For repeated violations, it hinted at supply suspension or termination of transactions.
Additionally, Pulmuone Health & Living controlled the retailers' selling prices above a certain level by pre-designating and notifying promotional prices or requiring prior approval of selling prices whenever the retailers intended to conduct their own promotional events.
Article 46 of the Monopoly Regulation and Fair Trade Act (Fair Trade Act) prohibits resale price maintenance as it infringes on the price-setting rights of trading partners, restricts price competition, and harms consumer welfare.
The KFTC stated, "Through this measure, price competition in the small kitchen appliances market is expected to be promoted, expanding consumer choice by enabling consumers to purchase products at lower prices."
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