"Buy Chopsticks and Plastic Bags Only From Us": Shinjeon Tteokbokki Fined 967 Million Won for Forcing Franchisees to Purchase Supplies

Forced Purchase of 15 Types of General Merchandise Including Spoons and Plastic Bags
70 Certified Notices Sent Warning "Contract Termination" to Franchisees Who Did Not Comply

The headquarters of the well-known tteokbokki franchise "Shinjeon Tteokbokki" was caught by authorities for forcing franchise owners to purchase general manufactured goods such as chopsticks and containers.

Shinjeon Tteokbokki menu photo. Shinjeon Tteokbokki official website.

The Fair Trade Commission announced on the 22nd that it had decided to issue a corrective order and impose a fine of 967 million won on Shinjeon Foodsys, the franchisor of Shinjeon Tteokbokki, for unfairly restricting trading partners.

According to the Fair Trade Commission, Shinjeon Foodsys pressured franchisees to purchase 15 types of manufactured goods—including chopsticks, spoons, cups, and plastic bags—that were not even listed in the disclosure document, exclusively from itself or its regional headquarters. From 2021 to 2023, the company sent a total of 70 certified letters to 59 franchisees who individually purchased goods externally, warning of "serious contract violations" and threatening contract termination and claims for damages. In particular, starting in March 2023, the company implemented a "direct purchase checklist" to systematically monitor and report whether franchisees were making external purchases, further tightening its control.

During this process, Shinjeon Foodsys took unfair profits (differential franchise fees) of at least 630 million won by adding margins of 12.5% to 34.7% to manufactured goods that were no different from those available on the market. During the Fair Trade Commission's investigation, the headquarters changed the relevant items to "recommended items" and began corrective measures, but could not avoid stern penalties for the prolonged coercive practices.

This measure is significant in that it clearly recognized the illegality of forcing franchisees to purchase general consumables unrelated to trademark protection or brand identity maintenance, even if such requirements were not specified in the disclosure document. The Fair Trade Commission stated, "We will continue to closely monitor any acts that unfairly restrict the suppliers of items easily available on the market and place excessive burdens on franchise owners."

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