"Mask 'Out of Stock' Deception and Price Hikes Lead to Sales Suspension"…Fair Trade Commission Chair Seeks Companies

One-Week Inspection of Paris Baguette, Innisfree, Mapo Galmaegi, Yuyang D&U, Coupang
Fair Trade Commission Chairman: "Store Tenants Should Strive for Self-Regulation in Selling Hygiene Products Like Masks"

The person on the right is Seongwook Jo, Chairman of the Korea Fair Trade Commission (Photo by Korea Fair Trade Commission).

[Asia Economy Reporter Moon Chaeseok] "Companies that falsely report masks as out of stock despite having inventory, unilaterally cancel consumer orders, and then raise prices to resell will be immediately suspended from selling." (Kim Beomseok, CEO of Coupang) "We appreciate the measures related to health and hygiene products." (Cho Sungwook, Chairman of the Fair Trade Commission)

As the novel coronavirus disease (COVID-19) spreads, unfair practices in mask pricing and sales have increased, prompting Chairman Cho to step up his efforts.

Last month, three mask companies were caught by the Fair Trade Commission for unilaterally ignoring consumer orders and arbitrarily adjusting prices despite having inventory.

In response, Chairman Cho visited Coupang, one of the online shopping malls serving as a channel for these companies, to inspect their self-regulation measures against unfair practices.

On the 6th, he visited Coupang to check the sales status of COVID-19 related health and hygiene products such as masks and hand sanitizers, as well as daily necessities. He also reviewed Coupang’s self-regulatory actions regarding unfair practices by sellers on its platform.

CEO Kim explained, "Coupang is facing difficulties as supply has not kept pace with the surge in orders caused by this situation. If we find sellers unilaterally canceling consumer orders and then selling at abnormally increased prices or engaging in unfair practices such as bundling masks, we take strong measures such as suspending sales."

He added, "Additionally, we have frozen prices and limited the purchase quantity per person for masks and hand sanitizers sold directly through Rocket Delivery. For consumers whose orders were canceled due to mask stockouts, we are securing masks and reshipping them."

Chairman Cho said, "The government is doing its best to prevent increased consumer anxiety," and urged, "All online shopping malls, including Coupang, should make greater efforts to prevent consumer anxiety from rising."

He also paid attention to the Fair Trade Commission’s key agenda of 'win-win cooperation between powerful and weaker parties.' He reviewed support measures for subcontractors and win-win models between franchise headquarters and store owners.

Earlier, on the 18th of last month, Chairman Cho visited three franchise stores?Paris Baguette, Innisfree, and Mapo Galmaegi?located in the 'Euneungjeongi' cultural district near Jungangno Station in Jung-gu, Daejeon, stating, "If sharing of sales promotion costs is strengthened and internal dispute resolution guidelines are presented, we can offer various incentives such as exemption from the Fair Trade Commission’s ex officio investigations."

On the 24th of last month, he visited Yuyang D&U, a small and medium-sized electronic parts manufacturer in Hwaseong, Gyeonggi Province, saying, "We will positively consider cases where overseas partners have been relocated domestically as contributing to the growth of the domestic materials, parts, and equipment industry."

While the Fair Trade Commission chairman’s active moves are commendable, it is also true that criticism exists that communication with the industry began belatedly due to the COVID-19 crisis only six months after his inauguration in September last year.

Some compared him to his predecessor, Kim Sangjo, former Blue House Policy Chief, who was known as a 'powerful chairman' with vigorous activities. There are also calls for Chairman Cho to continue such corporate field communications even after the COVID-19 situation subsides.

A Fair Trade Commission official said, "Recently, Chairman Cho has been emphasizing field communication and actively engaging. Internally, about 60% preferred a 'powerful chairman' over a 'quiet chairman,' and recently more people see that Chairman Cho has 'changed'."

This content was produced with the assistance of AI translation services.