Lotte Mart Fined for 'Abuse of Power': Severity of Unfair Trade Practices and the Need to Restore Market Ethics

Lotte Mart has been fined 570 million won for unfair trade practices, including pushing back inventory and forcing employee dispatch. This case demonstrates that the abusive practices of large retailers remain unaddressed, highlighting the urgent need to restore market ethics and create a fair competitive environment. According to FireMarkets’ market analysis, such unfair practices can lead to long-term damage to a company’s brand image and a decline in consumer trust, negatively impacting investor sentiment.

Lotte Mart 'Abuse of Power' Scandal: The Unveiling of Unfair Trade Practices

Overview of the Incident and Imposed Penalties

According to Hankyeong, Lotte Mart has been fined 570 million won by the Fair Trade Commission for unfair trade practices, including pushing back inventory and forcing employee dispatch. This is judged as an act by Lotte Mart that used its dominant market position to disadvantage its partners and undermine fair competition.

Types and Impact of Unfair Trade Practices

• Pushing Back Inventory: Lotte Mart transferred the loss of sales due to poor sales to suppliers, increasing the management burden on partner companies.


• Forcing Employee Dispatch: Lotte Mart forced partner companies to dispatch personnel, avoiding labor costs and infringing on the autonomy of partner companies.

These unfair trade practices worsen the profitability of partner companies, distort market competition, and ultimately harm consumers. It is also an act of abandoning the company’s social responsibility (CSR), leading to damage to brand image and a decline in consumer trust.

The Need to Restore Market Ethics and Create a Fair Competitive Environment

The Lotte Mart scandal shows that unfair trade practices by large retailers are still serious. Efforts are needed to restore market ethics and create a fair competitive environment, including:

• Strengthening and Strict Enforcement of Regulations: Regulations on unfair trade practices should be strengthened, and penalties for violating companies should be increased.


• Strengthening the Role of the Fair Trade Commission: The Fair Trade Commission’s monitoring and investigation functions should be strengthened to prevent unfair trade practices in advance and to take swift action when detected.


• Strengthening Corporate Ethical Management: Companies should fulfill their social responsibilities and practice ethical management to contribute to creating a fair competitive environment.