'Allegations of Forcing "Unified Food Prices and Discounts"... Fair Trade Commission Begins Investigation into Baemin'

The Fair Trade Commission has launched an investigation into allegations that Baedal Minjok (hereinafter Baemin) forced restaurants to match food prices and discount benefits to the same level as other delivery apps.

According to industry sources on the 29th, the Fair Trade Commission is investigating Baemin for suspected violations of the Fair Trade Act. The core of the allegations is that when Baemin introduced the free delivery subscription service 'Baemin Club,' it demanded that store owners set menu prices lower than or equal to those sold on other delivery apps, a practice known as 'most-favored-nation treatment.'

The Fair Trade Commission views the most-favored-nation treatment as a key factor that hinders competition among delivery apps and leads to commission fee increases. If the most-favored-nation clause is demanded, even if Baemin raises its commission fees, the merchants who agreed to this clause must either absorb the commission while keeping prices unchanged or raise prices equally on other delivery apps. Ultimately, this shifts the burden of commission fee increases directly onto businesses or consumers.

Last July, in front of the Woowa Brothers headquarters in Songpa-gu, Seoul, representatives from Rider Union, the Meeting of CEOs for Fair Platforms, and the Service Federation Delivery Platform Union held a press conference condemning and demanding the withdrawal of the commission fee increase by Baedal Minjok.
[Photo by Yonhap News]

The Fair Trade Commission is also examining whether Baemin's 'Same Price Certification System' constitutes a demand for most-favored-nation treatment. Baemin introduced the same price certification system last July under the pretext of alleviating consumer concerns that food prices on delivery apps might be higher than in-store prices.

Stores verified to have prices equal to their in-store prices are marked with a label stating 'Same price as in-store.' In response, merchants argue that Baemin's price control aims to prevent them from offsetting commission burdens through dual pricing.

The Fair Trade Commission plans to review whether Baemin's same price certification system can be regarded as a demand for most-favored-nation treatment that effectively enforces price parity between online and offline channels.