FTC fines Kakao Mobility $54.8 million for antitrust violations

Korea’s antitrust regulator has imposed a fine of 72.4 billion won ($54.8 million) on Kakao Mobility, the nation’s largest ride-hailing service provider, and will file charges with the prosecution.

A Kakao T Blue taxi parked in Seoul in February, 2022 [YONHAP]

Korea’s antitrust regulator has imposed a fine of 72.4 billion won ($54.8 million) on Kakao Mobility, the nation’s largest ride-hailing service provider, and will file charges with prosecutors.

The decision follows the company’s attempt to block its four competing taxi franchise operators from accessing its ride service.

The Fair Trade Commission (FTC) stated Wednesday that Kakao Mobility demanded the competing operators — Banban Taxi, Macaron Taxi, UT and Tada — either pay fees or sign a partnership agreement that would allow the company to collect real-time data on drivers affiliated with competing franchises, including their operational information from their own call apps. If the operators refused, the firm threatened to block the drivers from accessing its ride-hailing app, Kakao T.

Kakao Mobility's market share in the franchise taxi market has grown from 51 percent in 2020 to 79 percent in 2022.

“This measure is significant as it penalizes a dominant platform for abusing its market power to restrict fair competition and expand its dominance,” the FTC said. “It also highlights the problematic practice of demanding business secrets from competitors to use in one’s own business strategies, which can undermine fair competition in the market.”

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]