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The Fair Trade Commission has demanded major retailers cut commission they charge traders who use their floor space.
The corporate watchdog plans to pressure business groups by disclosing the commission fees they charge merchants, who often have no other option but to comply to the rules set by department stores.
“I have met with heads of Lotte Shopping, Hyundai Department Store and Shinsegae Department Store to seek their cooperation in Seoul’s push for a shared growth,” Jeong Jae-chan, vice chairman of the FTC said.
The renewed push on major retailers is part of the watchdog’s year-long plan to uproot anticompetitive business practices in the industry, which are seen as an obstacle to promote shared growth between large and small businesses.
The Korea Federation of Small and Medium Businesses, a non-profit lobby group, in May was tasked with investigating whether merchants selling their products through major retailers were being bullied with commission fees far above the industry norm of 20 to 25 percent of wholesale costs.
The three retailers did not comply with the watchdog’s repeated requests to slash commission charges made since June, the FTC said.
By Cynthia J. Kim (cynthiak@heraldcorp.com)
The corporate watchdog plans to pressure business groups by disclosing the commission fees they charge merchants, who often have no other option but to comply to the rules set by department stores.
“I have met with heads of Lotte Shopping, Hyundai Department Store and Shinsegae Department Store to seek their cooperation in Seoul’s push for a shared growth,” Jeong Jae-chan, vice chairman of the FTC said.
The renewed push on major retailers is part of the watchdog’s year-long plan to uproot anticompetitive business practices in the industry, which are seen as an obstacle to promote shared growth between large and small businesses.
The Korea Federation of Small and Medium Businesses, a non-profit lobby group, in May was tasked with investigating whether merchants selling their products through major retailers were being bullied with commission fees far above the industry norm of 20 to 25 percent of wholesale costs.
The three retailers did not comply with the watchdog’s repeated requests to slash commission charges made since June, the FTC said.
By Cynthia J. Kim (cynthiak@heraldcorp.com)
