CJ Olive Young fined 1.9 bln won for alleged unfair biz practices

By Oh Seok-min

SEOUL, Dec. 7 (Yonhap) -- The antitrust regulator said Thursday it has decided to fine CJ Olive Young Corp. 1.89 billion won (US$1.43 million) for alleged unfair practices against suppliers.

The Fair Trade Commission (FTC) also referred the South Korean leading health and beauty store chain operator to the prosecution for further investigation and called on it to take corrective measures.

The company was accused of forcing its suppliers not to take part in sales promotion events organized by rival malls in the same month, as well as a month earlier, when it staged major promotional events with the suppliers, from 2019 until recently, in violation of the country's large-scale retail business act.

It also pocketed 800 million won from March 2019 to June 2021, as it received goods at lower prices for events and sold part of them at normal prices after such events ended.

CJ also charged 760 suppliers fees for providing product information from 2017-2022, though the suppliers did not make such requests, according to the FTC.

But the regulator decided to conclude its deliberation process on CJ's alleged exploitation of its dominant position in the local market, as it was impossible for the commission members to make a decision due to difficulties in verifying related facts and in forecasting future market situations.

CJ has implemented a so-called exclusive brand policy, where it gives financial advantages to suppliers, such as cheaper advertising costs, on the condition they do not do business with rival retailers.

"The decision does not mean that CJ has been cleared of the alleged abuse of its dominant market position, but continued monitoring is needed given its growing influence in the market and its exclusive brand policy being one of its key strategies," an FTC official said.

graceoh@yna.co.kr
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