Baemin, Coupang Eats face $471mn fine over unfair pricing demands

By Maekyung News Service

South Korea’s two leading food delivery platforms, Baemin and Coupang Eats, face a record combined fine for allegedly forcing restaurants to offer prices and terms at least as favorable as those available on rival apps.

The Korea Fair Trade Commission (FTC) said Monday it would impose a combined 631.9 billion won ($471.25 million) in fines and corrective orders on Woowa Brothers Corp., operator of Baemin, and Coupang Inc., operator of Coupang Eats, for abusing their market dominance.

Woowa Brothers faces a fine of 331.1 billion won and Coupang one of 300.8 billion won.

The FTC found that Baemin and Coupang Eats, which together held a 92.89 percent market share as of last year, simultaneously demanded most-favored-nation (MFN) treatment from restaurants, producing effects similar to those of collusion.

The MFN requirements obliged restaurants to offer prices, minimum order amounts, and other terms on the two platforms at least as favorable as those available on competing apps. The practice prevented restaurants from offering better deals elsewhere, restricting price competition and potentially harming consumers.

Woowa Brothers and Coupang said they would review the FTC’s final written decisions before determining their responses, including whether to pursue legal action.

Coupang said the FTC had inflated the fine by including delivery revenue unrelated to the alleged violations in its calculation, adding that the process had undermined the company’s right to defend itself.

Capital.com is an execution-only brokerage platform and the content provided on the Capital.com website is intended for informational purposes only and should not be regarded as an offer to sell or a solicitation of an offer to buy the products or securities to which it applies. No representation or warranty is given as to the accuracy or completeness of the information provided.

The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance.

To the extent permitted by law, in no event shall Capital.com (or any affiliate or employee) have any liability for any loss arising from the use of the information provided. Any person acting on the information does so entirely at their own risk.

Any information which could be construed as “investment research” has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.