Fair Trade Commission Begins Sanctions on Kakao Mobility Over 'Call Steering Suspicion'

[Asia Economy Reporter Heo Kyung-jun] The Korea Fair Trade Commission (KFTC) has completed its investigation into allegations of "call (passenger request) favoritism" involving Kakao Mobility's affiliated taxis and has initiated disciplinary procedures.

According to industry sources on the 25th, the KFTC examiner sent Kakao Mobility a review report (equivalent to a prosecutor's indictment) containing opinions on sanctions for preferential treatment of its own services.

In 2020, the KFTC launched an investigation after receiving reports from taxi organizations suspecting that Kakao Mobility was engaging in unfair practices by favoring calls to Kakao-affiliated taxis (KakaoT Blue).

The taxi organizations claimed that when passengers request taxis via the KakaoT app, affiliated taxis located farther away are dispatched first instead of nearby regular taxis.

Following an on-site investigation at the headquarters, the KFTC examined whether Kakao Mobility adjusted its algorithm to prioritize dispatching affiliated taxis over non-affiliated ones. As a result, it is known that the KFTC tentatively concluded that Kakao Mobility, the leading company in the platform mobility market, abused its dominant market position by favoring its own services, and that sanctions are necessary.

The results of a fact-finding survey announced by the Seoul Metropolitan Government in February regarding the allegations of call favoritism by Kakao Taxi also served as a basis for the KFTC's judgment.

Kakao Mobility denies the related allegations, having established the industry's first taxi AI dispatch system introduction page on its official website, disclosing detailed information about the dispatch process, components of the dispatch system, and variables considered.

The KFTC plans to review Kakao Mobility's written response to the review report and then hold a plenary meeting involving nine commissioners, including the chairman of the Fair Trade Commission, to decide the level of sanctions.

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