86% of Delivery App Users Oppose Baemin-Yogiyo Merger... Fair Trade Commission's Key Concern: 'Competition Restriction'

[Asia Economy Reporter Moon Chaeseok] As the Fair Trade Commission reviews the corporate merger of Baedal Minjok and Yogiyo, the top two players in the domestic delivery app market, a survey revealed that more than eight out of ten users oppose the merger. Consumer concerns about market monopolization, price increases, and service quality decline?key issues considered by the Fair Trade Commission in assessing the merger's validity?were also found to be significant.

A survey conducted by the Citizens' Coalition for Economic Justice targeting 500 adult men and women who have used delivery apps in Seoul, Gyeonggi Province, and six other metropolitan cities nationwide showed that 86.4% opposed the merger of the two companies.

The main reasons for opposing the merger (multiple responses allowed) included 82.9% citing "price increases in food and delivery fees due to the formation of a monopoly market." This was followed by "reduced motivation for business innovation or service improvement" (46.3%) and "decrease in consumer benefits such as coupons and events" (40.5%).

Additionally, 81% of respondents said, "If the two companies merge, it will become difficult for new businesses to enter the market."

Concerns were also raised regarding market monopolization, price increases, and service quality decline?core factors the Fair Trade Commission considers when judging the merger.

The Citizens' Coalition for Economic Justice explained, "In the context of the rapid growth of the delivery app market due to the spread of COVID-19, consumers' concerns about price hikes and service deterioration caused by the creation of a monopolistic position are very high."

Article 7 of the Monopoly Regulation and Fair Trade Act (Fair Trade Act) states, "If the efficiency gains that are difficult to achieve by any means other than the corporate merger outweigh the damage caused by competition restriction, the restrictions on corporate mergers shall not apply."

However, Article 16 of the same law states, "For corporate mergers violating Article 7 (including related parties in some cases) or violators, corrective measures such as ▲cessation of the act ▲disposal of stocks ▲resignation of executives ▲transfer of business ▲cancellation of debt guarantees ▲restrictions on business methods or scope to prevent damage caused by competition restriction due to the corporate merger may be ordered."

This means that if the Fair Trade Commission determines that the benefits of the merger outweigh the harm caused by competition restriction, it may allow the merger but impose corrective measures if the violation is deemed serious.

A Fair Trade Commission official said, "Before concluding the corporate merger validity review, rather than being influenced by specific issues such as the fee controversy, we will focus on reducing competition restrictions and closely examine whether market monopolization, price increases, and service quality decline occur."

The legal deadline for the Fair Trade Commission's review of the merger between Woowa Brothers and Delivery Hero is June 28. The Commission stated that it will take sufficient time to thoroughly review the materials without being bound by the legal deadline.

The survey was conducted online from February 25 to May 10, with a sampling error of ±4.4 percentage points at a 95% confidence level.

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