Kakao Mobility fined 72.4 bln won for alleged monopolistic biz practices

The antitrust regulator said Wednesday it has decided to fine Kakao Mobility Corp. 72.4 billion won (US$54.82 million) for allegedly demanding competing taxi franchise operators sign partnership deals and blocking their access to its taxi-hailing services in case of rejecting the offer. The operator of South Korea's leading taxi-hailing service Kakao T allegedly demanded the four smaller competitors of Uber, Banban Taxi, Macaron Taxi, and Tada sign a partnership agreement. In the case of refusal, Kakao blocked drivers affiliated with the competitors from having access to Kakao T and prevented them from getting non-franchise ride requests in violation of the fair trade act, according to the Fair Trade Commission (FTC). Kakao T is open to both franchise and non-franchise taxis, and its market share in the non-franchise taxi market came to 97 percent as of 2022. In an effort to boost its market share in the franchise taxi industry, Kakao launched the franchise service Kakao T Blue in 2019 through its platfo rm and allegedly had tried to foreclose competitors. Though the partnership agreement allows Kakao to collect business secrets and other sensitive information on a real-time basis, Banban and Macaron signed the contract, which led to Kakao's share in the franchise taxi market rising from 51 percent in 2020 to 79 percent in 2022. Tada did not sign a contract with Kakao but later changed its course after suffering difficulties in operating businesses. Uber has not formed a partnership with Kakao. "Due to such practices, most of its competitors have left the market. The move hampered the fair competition and affected the rights of choice of taxi drivers and customers regarding the service," the regulator said in a release. The FTC referred Kakao Mobility to the prosecution for further investigation. FTC chief Han Ki-jeong said the giant platform "unfairly used its market dominance and conducted an anti-competitive act to expand its market dominance into relevant sectors," adding its call on competitors to g ive business secrets also affect the fair competition. Source: Yonhap News Agency