By Kim Hyun-cheol
Staff Reporter
Four major local beverage makers have been fined 940 million won ($798,100) in total by the nation’s fair-trade agency for forcing retailers not to lower prices of their products.
The Fair Trade Commission (FTC) said Tuesday that it was fining Lotte Chilsung Beverage, Coca-Cola Korea, Haitai Beverage and Donga-Otsuka because their activities, including restricting retailers’ markdown of their products, seriously hurt fair competition on the local beverage market.
Lotte Chilsung was given the heaviest fine of 500 million won, followed by Coca-Cola with 300 million won and Haitai Beverage with 140 million won. Donga-Otsuka ended up with a corrective order as its violation was regarded as minor in comparison with the other three.
The action came after the watchdog agency fined them 25.5 billion won for price-rigging in August. A total of five makers, including those fined this time, allegedly had raised prices of their products four times in collusion since February last year, according to the FTC.
This time, Lotte Chilsung and Coca-Cola Korea were accused of forcing retailers in their distribution network, including discount outlets, to keep the price tags that they required. They also needed to ask for permission in advance before any discount promotions of the products, the FTC said.
Lotte was involved in another charge along with Haitai Beverage that it coerced distributors into signing written promises that they won’t supply products to other retailers for prices below the company-set range.
Donga-Otuska reportedly conducted price checks on its retailers on a regular basis for the same purpose.
The Korean non-alcoholic beverage market was valued at 3.6 trillion won last year, up 5.3 percent from the previous year. Currently, Lotte Chilsung leads the market with a 36.7-percent share, with Coca-Cola Korea and Haitai Beverage trailing with 17.6 percent and 10.3 percent, respectively.