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Photo = Kakao Mobility |
[Alpha Biz= Kim Jisun] Kakao Mobility has successfully overturned a ₩27.1 billion (approximately USD 20 million) penalty imposed by the Korea Fair Trade Commission (KFTC) over allegations that it unfairly prioritized affiliated taxi drivers on its ride-hailing platform.
On May 22, the Seoul High Court’s Administrative Division 7 (Presiding Judge: Koo Hoe-geun) ruled in favor of Kakao Mobility in a lawsuit seeking to nullify the corrective order and fine issued by the KFTC. The court accepted Kakao Mobility’s claim that its ride allocation practices were not discriminatory toward unaffiliated drivers.
The case dates back to February 2023, when the KFTC penalized Kakao Mobility for allegedly adjusting its "Kakao T" ride dispatch algorithm to favor drivers operating under its franchise brand, “Kakao T Blue.” The regulator claimed this amounted to unfairly allocating business in violation of fair competition rules.
At the time, the Kakao T app offered two main ride-hailing options: a free "general call" and a paid “Blue call” service, which charged passengers up to KRW 3,000. Unaffiliated taxis were only eligible for general calls, whereas franchise drivers could receive both types of calls.
In response, Kakao Mobility filed an administrative lawsuit asserting that it did not discriminate between franchise and non-franchise drivers, but rather sought to enhance convenience and efficiency for both riders and drivers.
Following the verdict, Kakao Mobility stated, “This ruling confirms that we did not discriminate against unaffiliated drivers and that our efforts have focused on improving benefits for both consumers and drivers.”
Fair trade administrative cases in South Korea follow a two-tier system, with the Seoul High Court handling the first instance and the Supreme Court reviewing any appeals. The KFTC may choose to appeal the decision to the Supreme Court.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
