 |
Photo = Yonhap news |
[Alpha Biz= Paul Lee] The Korea Fair Trade Commission (KFTC) has launched an investigation into the facts surrounding the controversy over Ilyang Pharmaceutical's suspension of health supplements sold at Daiso.
The investigation aims to determine whether there were any violations of the Fair Trade Act during the process of Ilyang Pharmaceutical's withdrawal from Daiso's health supplement business, such as undue influence exerted by the Korean Pharmaceutical Association (KPA). If a business association like the KPA unjustly restricts the business activities of its members, penalties such as fines or criminal complaints can be filed under the Fair Trade Act.
According to relevant authorities on Monday, the KFTC is currently verifying whether any legal violations occurred regarding Ilyang Pharmaceutical's withdrawal from Daiso’s health supplement products. A KFTC official stated, "After seeing media reports last week about Daiso’s health supplements, we are at the stage of confirming the facts. Specific details are difficult to mention."
On the 24th of last month, Ilyang Pharmaceutical launched 9 types of health supplement products exclusive to Daiso. These Daiso-exclusive products, with adjusted ingredients and contents, were priced up to 10% lower than those sold at pharmacies, and received a strong consumer response.
However, Ilyang Pharmaceutical suddenly decided to withdraw the products just five days after the launch. It is also reported that Daewoong Pharmaceutical and Chong Kun Dang Health, which launched the health supplements with Ilyang Pharmaceutical, are considering withdrawing as well. Subsequently, KPA Chairman Kwon Young-hee met with the three pharmaceutical companies and demanded corrections. This led to speculation that the decision was influenced by the strong opposition, including signs of a boycott movement by pharmacists.
The KFTC is examining whether there were any legal violations in the decision-making process for the three pharmaceutical companies' withdrawal from Daiso’s health supplement business. This includes investigating whether the KPA directed a boycott against these pharmaceutical companies or coerced pharmacists into participating in the boycott. If a business association organizes such a boycott, it could be considered a violation of the Fair Trade Act regarding business association prohibited activities.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
