Sogongyeon: "The Merger Review of Woowa Brothers and DH Must Be Conducted Strictly"

[Asia Economy Reporter Moon Hyewon] The Korea Federation of Micro Enterprise Associations (hereinafter referred to as KFMEA) urged the Fair Trade Commission to conduct a strict review regarding the corporate merger examination of Woowa Brothers (Baedal Minjok) and Delivery Hero (DH) on the 20th.

In a statement released that day, KFMEA said, "We have continuously expressed opposition to the corporate merger between Woowa Brothers and DH, and in April of this year, we submitted an opinion letter to the Fair Trade Commission urging a strict review in accordance with relevant laws." They added, "Through the opinion letter, we urged that it is necessary to identify whether they have engaged in acts that harm competing companies, franchisees, or consumers by violating fair trade practices or competitive order, or have gained unfair benefits through such acts, and to specifically examine whether such acts are likely to intensify due to the merger and acquisition."

They continued, "At the stage of market definition, it is necessary to consider not only the market where transactions occur between delivery apps and delivery service users (consumers), but also the market where transactions occur between delivery apps and franchisees (small business owners in the food service industry, etc.), as well as the upstream and downstream markets such as the labor market where riders performing delivery work are supplied, and to thoroughly review the competition restrictions arising in each market."

Furthermore, they stated, "A detailed examination should be conducted regarding concerns about the unilateral determination of transaction conditions such as fees imposed on small business owners, the risk of abuse of market dominance and intensification of unfair practices, the choice rights of small business owners, and the possibility of entry, growth, and competition activation of other companies in the relevant market." They added, "If the corporate merger is approved, the top domestic delivery app market share holder will basically be transferred to a foreign company, which could act as a shield to evade the application of domestic laws, raising concerns."

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