What: Lotte, Shinsegae, and Hyundai have been fined by the Fair Trade Commission (FTC) in South Korea for unfairly passing marketing costs onto their store tenants without prior notice.

Why it is important: The fines highlight the significance of protecting tenants' rights and preventing retail operators from unfairly shifting marketing costs onto their store tenants.

The fines totalled KRW 648 million won (USD 420,230). This is the first time the FTC has uncovered such an illegal act between outlet operators and store tenants. Lotte Shopping received the highest fine of KRW 337 million. Shinsegae Simon and Hyundai Department Store were fined KRW 140 million and KRW 120 million, respectively. The outlet operators shifted a total of KRW 588 million in costs to tenants during special sales promotion events between 2019 and 2020. The FTC plans to increase monitoring of major retail players to protect tenants' rights.

Lotte, Shinsegae, Hyundai fined for unfairly shifting marketing costs to tenants