[Alpha Biz= Paul Lee] South Korea’s antitrust regulator has ordered the franchise operator of the popular spicy rice cake brand “Dongdaemun Yeopgi Tteokbokki (Yeopdduk)” to correct practices that forced franchisees to purchase specific electronic equipment.

On June 8, the Korea Fair Trade Commission (KFTC) said it issued a corrective order against Hotseasoner, the franchisor behind Yeopdduk, for requiring franchise owners to buy certain devices—including POS systems, kiosks, and digital signage displays (DID)—either from the company itself or from vendors designated by the headquarters.

According to the KFTC, Hotseasoner designated POS systems as mandatory purchase items from April 2013 to August 2025, and kiosks and digital display boards from September 2024 to August 2025.

The franchise agreements also included provisions stating that if franchisees purchased the equipment from non-designated suppliers, the company could restrict supplies, terminate franchise contracts, or impose penalties.

Hotseasoner argued that the requirement was necessary to maintain system uniformity across franchise stores. However, the KFTC concluded that the equipment involved was standard commercial electronic products readily available in the market, meaning there was no clear need to require purchases from specific vendors.

The regulator also noted that the company later changed the status of the three items from “mandatory” to “recommended” on Aug. 26, 2025, despite no significant change in circumstances.

The KFTC determined that franchise operations could function properly as long as franchisees used devices meeting certain performance standards and integrated them with the franchisor’s POS system, and therefore ruled that the company’s actions constituted “unfair restriction of trading partners” under the Franchise Business Act.

 

 

 

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