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TV home shoppings` unfair activity to be sanctioned

Posted November. 20, 2014 08:57,   


TV home shopping companies` share of sales of products of small and mid-sized companies and products of direct purchase will be reflected when they apply for business license re-approval. Another screening criterion includes the share of broadcasting that gives smaller companies fixed amount of money regardless of sales.

At the economic ministerial meeting at the government complex in Seoul on Wednesday, the government announced comprehensive measures to support small and mid-sized companies` sales channels. The latest measure is a follow-up policy after Prime Minister Chung Hong-won said on last Wednesday at a small and mid-sized company seminar that TV home shopping firms` unfair activities will be reflected in the process of business license re-approval.

The government will open a home shopping damage reporting window where smaller companies can report TV home shopping firms` unfair transactions such as verbal ordering and passing on broadcasting production costs to them. Under the system, the Fair Trade Commission and the Small and Medium Business Administration will investigate in case of a damage report. Once any unfair act is proven, the government agencies will impose sanctions including penalty.

Considering that smaller companies have difficulty in entering existing distribution channels, the government will build a "comprehensive distribution platform for creative and innovative products" linking TV programs, Internet, mobile and offline around June next year. Korean product stores are currently obligated to be set up in duty free shops in cities but this will be expanded to airport departure duty free shops.