This undated file photo shows the logo of Papa John’s pizza restaurant chain. (Image courtesy of Yonhap)
SEOUL, Oct. 24 (Korea Bizwire) — The antitrust regulator said Thursday it has decided to fine Papa John’s Korea 1.48 billion won (US$1.07 million) for unfair business practices against franchise shops.
The pizza restaurant chain had allegedly designated 15 kinds of cleaning products, including hand soaps, as must-buy items from the headquarters and forced franchise shop owners to buy and use the designated products from July 2015 until recently, according to the Fair Trade Commission (FTC).
Under its operation guidelines, those who violate the rule were subject to business suspension, which the FTC sees as a violation of the franchise business act.
Papa John’s had also required the renovation of 25 franchise shops from 2015 through 2022 and failed to pay due costs to shop owners.
In addition to the penalty, the FTC ordered the pizza chain to pay the costs and take other corrective measures.
“Those practices infringed upon the free decision-making and economic interests of its franchise shop owners. We will continue to thoroughly monitor unfair practices of the franchise headquarters,” the FTC said in a release.
(Yonhap)
