SEOUL, Dec. 11 (Korea Bizwire) — South Korea’s antitrust regulator said Sunday it has decided to impose fines of 918 million won (US$697,000) on two local units of Pernod Ricard, a French distiller, for handing out illegal rebates to bars.
The penalty on Pernod Ricard Korea and Pernod Ricard Korea Imperial came as the two companies gave rebates totaling 61.5 billion won to hundreds of entertainment establishments from 2010 to 2020, according to the Fair Trade Commission (FTC).
The two businesses are virtually considered as a single entity handling popular whisky brands, such as Ballantine’s, Chivas Regal, and Royal Salute, according to the FTC. Pernod Ricard Korea Imperial virtually suspended its operation since 2019, it added.
The regulator said it plans to slap fines of 459 million won on each firm.
Under the South Korean law, companies are prohibited from inducing customers to make purchases by providing “unfair” benefits.
“The latest decision is significant as the FTC has detected and corrected the unfair rebate custom deep rooted in the local liquor industry over the span of 10 years,” the FTC said in a statement.
The regulator added that the measure is expected to help the local market establish a competition system based on price, quality and service, instead of illegal rebates.
Pernod Ricard took up 8 percent of the local whisky market in 2019, standing as the third-largest player. Diageo stood as the biggest player with 34 percent, trailed by Golden Blue with 28 percent, according to the FTC.