SEJONG-- The chief of South Korea's corporate watchdog pledged Wednesday to carry out sweeping reforms of the local distribution and retail industry to root out unfair business practices and strengthen consumer protection.
Fair Trade Commission (FTC) Chairman Kim Sang-jo made the comment at a meeting in Seoul with business leaders representing the Korea Chainstore Association, the Korea Online Shopping Association and the Korea TV Home Shopping Association.
Last month, the FTC unveiled a plan to impose punitive damages of up to three times the actual losses incurred against illegal business practices, such as unfair payment, returns and cutting back supplied goods, that occur between large shopping mall operators and small shops.
It will also toughen administrative sanctions against such practices and revise public disclosure guidelines on sales commission rates.
"The measures are aimed at improving the FTC's law enforcement, expanding protection of small businesses and strengthening oversight of unfair practices," Kim said. "The FTC will push forward with the current reform drive, and make it predictable and irreversible."
He said that the outcome of the reforms will help the industry become more competitive through fair and transparent business activities.
The South Korean distribution industry is currently led by mega-sized retailers, department stores and discount outlets that lease their spaces to small businesses.
Big-name retail giants such as Lotte, Shinsegae and Hyundai Department Store take up the bulk of the market share and wield great influence over the entire industry.
Since his inauguration in June, Kim, a renowned civic activist who has advocated minor shareholders' rights, has placed the biggest policy priority on fair competition.
He has said that he will keep large business groups from abusing their market dominance and will protect small-time businesses to create a fairer market environment.
Source: Yonhap News Agency