 |
Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] Woowa Brothers, operator of South Korea’s leading food delivery app Baemin, has denied allegations surrounding a so-called “Baemin-only” promotion conducted jointly with Chogajip Yangnyeom Chicken franchisor Korea 153 Co..
On February 20, Woowa Brothers said it “strongly regrets the spread of false claims regarding a legitimate business activity carried out with the consent of the majority of franchisees,” adding that the controversy is causing harm not only to the company but also to participating franchise owners.
The statement came after the Chogajip franchisee association’s legal representative, YK Law Firm, announced that it had filed a complaint with the Korea Fair Trade Commission against Woowa Brothers and Korea 153, alleging unfair trade practices related to the joint promotion.
YK claimed that the memorandum of understanding (MOU) between Baemin and the franchisor involved potential abuses of market dominance, exclusive dealing arrangements, and deceptive commission settlement practices. According to the complaint, Baemin allegedly offered to lower brokerage fees from 7.8% to 3.5% in exchange for exclusive use of its platform, effectively encouraging franchisees to engage in exclusive transactions.
The franchisee association further argued that the promotion leveraged Baemin’s dominant market position to undermine franchisees’ managerial autonomy and amounted to de facto coercion. As a result, participating stores were said to be restricted from using competing delivery platforms, including Coupang Eats, Yogiyo, and public delivery apps such as Ttaenggyeoyo and Meokggaevi.
Woowa Brothers maintains that the promotion was voluntary and based on broad franchisee consent, rejecting claims that it imposed exclusivity or unfairly limited franchisees’ business choices.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
