CEO Score Investigates FTC Sanctions
Fines Imposed Last Year Total 550.2 Billion KRW
Number of Sanctions Rises by 13 to 124 Cases
Coupang Receives Total Fines of 140.1 Billion KRW
The Fair Trade Commission (FTC) reported that the amount of fines (including penalties) imposed on companies last year increased by more than 26% compared to the previous year. Among individual corporate groups, Coupang received the largest amount of fines.
According to the corporate data research institute 'CEO Score' on the 22nd, an investigation into the overall sanctions by the FTC from 2023 to 2024 revealed that the FTC imposed a total of 550.2 billion KRW in fines on companies last year. This represents a 26.5% increase compared to the previous year (435 billion KRW).
The number of FTC sanctions also rose to 124 cases last year, up by 13 from 111 cases the previous year. Among the 308 sanctioned entities, there were a total of 34 prosecutions, an increase of 6 from 28 the previous year. Prosecutions included 26 cases against corporations, 7 against owners and executives, and 1 against business associations. Compared to the previous year, prosecutions against corporations (19 cases) increased, while those against owners and executives (8 cases) decreased. The number of business association prosecutions (1 case) remained the same.
Among large corporate groups, Coupang was the group that received the highest amount of fines last year. Coupang and its two affiliates, Coupang (140.049 billion KRW) and CPLB (129 million KRW), were fined a total of 140.178 billion KRW. CPLB is a subsidiary responsible for Coupang's private brand (PB) products such as GomGom, Tamsa, and Comet.
According to the FTC, Coupang and CPLB were accused of manipulating the Coupang app to artificially display their PB products at the top when customers searched for product names. There were also suspicions that company employees were mobilized to write purchase reviews.
Following Coupang, Kakao was fined a total of 72.505 billion KRW across three entities: Kakao Mobility (72.4 billion KRW), Kakao (98 million KRW), and SM Brand Marketing (2.5 million KRW). The FTC imposed fines on Kakao Mobility in October last year for abusing its dominant market position.
CJ was the third-largest fined corporate group, receiving a total of 24.5 billion KRW in fines. The companies involved were CJ Freshway (16.7 billion KRW) and Freshone (7.8 billion KRW). Hyundai Department Store followed with a total fine of 19.763 billion KRW across two companies: Hyundai Livart (19.122 billion KRW) and Hyundai L&C (641 million KRW). Other groups with significant fines included Global Seaah (14.846 billion KRW), Sampyo (12.062 billion KRW), Nexon (11.642 billion KRW), Hyosung (11.237 billion KRW), KT (8.66 billion KRW), and LS (7.278 billion KRW).
Although not part of large corporate groups, KH Group (51.04 billion KRW), Hanssem (26.489 billion KRW), and Enex (17.396 billion KRW) were among the corporate groups fined over 10 billion KRW. Looking at individual companies, a total of 11 companies were fined over 10 billion KRW last year. Coupang had the most cases (2), followed by Kakao Mobility (1), and KH Gangwon Development (1 case, 34.03 billion KRW). Others included Hanssem (2 cases, 22.077 billion KRW), Hyundai Livart (1 case, 19.122 billion KRW), and Enex (1 case, 17.396 billion KRW).
The largest fine imposed among FTC sanctions last year was for the case of "Coupang and CPLB's deceptive customer inducement." The next largest was the "collusion among 31 businesses related to special furniture purchase bids from 24 construction companies," which resulted in fines totaling 93.12 billion KRW.
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