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South Korea's FTC inspects bhc, BBQ and Kyochon over chicken price collusion
En breve
South Korea's Fair Trade Commission sent investigators to the headquarters of chicken franchises bhc, BBQ and Kyochon Chicken on Oct 6 as part of a probe into possible price collusion, according to industry sources. The inspections followed public debate that menu prices stayed high while raw chicken prices fell, and came after President Lee Jae-myung said on Sept 30 that he would look into the matter. The industry says raw chicken prices alone do not determine final menu prices.
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South Korea's Fair Trade Commission sent investigators to the headquarters of chicken franchises bhc, BBQ and Kyochon Chicken on Oct 6 as part of a probe into possible price collusion, according to industry sources cited by Yonhap, Chosun Ilbo and Hankook Ilbo. The on-site inspections followed widening debate that chicken menu prices have stayed high even as prices of raw chicken fell. [ 1 , 2 , 3 ]
President Lee Jae-myung shared an article on social media on Sept 30 stating that the price of chicken for frying had fallen 37.7% over the previous six months while flagship menu items at major franchises held around 23,000 won, and wrote “한번 점검해 보겠다” (“I will look into it once”). According to Yonhap, the commission then began work to establish whether chicken prices are linked to raw material prices, how each company sets prices, and the cost-sharing structure between headquarters and franchisees. [ 1 , 2 , 3 ]
The inspections were carried out shortly after the holiday period and were led by agents of the commission's Cartel Investigation Bureau, which handles price collusion cases, according to Yonhap and Hankook Ilbo. An industry official told Yonhap that an FTC price-collusion investigation of major domestic chicken franchises is unprecedented. Korea Economic Daily reported the probe came six days after the president's remarks. [ 1 , 3 , 4 ]
The industry argues that comparing final selling prices with raw chicken prices alone is not appropriate, citing increases in labor, logistics, cooking oil and packaging costs, delivery platform commissions and franchise operating expenses. It also notes that headquarters absorbed costs and delayed price increases in the past when raw chicken prices rose. Pricing authority ultimately rests with franchisees, the industry says, making it difficult for headquarters to impose prices. [ 1 , 3 ]
Some in the industry see a low possibility of collusion, pointing to past legal disputes, including litigation, and relatively limited exchanges among chicken businesses compared with other sectors, Yonhap reported. Prices have not changed since bhc's last increase in December 2023, Kyochon's in April 2023 and BBQ's in June 2024. [ 1 , 3 ]
Por qué importa
The probe puts the pricing of a widely consumed franchise product under regulatory scrutiny and follows a rare public intervention by the president on consumer prices. If the Fair Trade Commission finds collusion, it could reshape how chicken franchises set prices; the industry argues that other rising costs and franchisee-level pricing authority, not coordination, explain current prices. The documents do not state what penalties, if any, are being considered.
Datos clave
- The Fair Trade Commission sent investigators to the headquarters of bhc, BBQ and Kyochon Chicken on Oct 6, according to industry sources. [ 1 , 2 , 3 ]
- The on-site inspections concern a possible price cartel in the chicken franchise industry. [ 1 , 2 , 3 ]
- President Lee Jae-myung shared an article on social media on Sept 30 saying chicken chicken prices fell 37.7% in six months while flagship franchise menus held around 23,000 won, and wrote that he would look into it. [ 1 , 2 , 3 ]
- The investigation was led by agents from the FTC's Cartel Investigation Bureau, which handles price collusion cases. [ 1 , 3 ]
- An industry official told Yonhap that an FTC price-collusion investigation of major domestic chicken franchises is unprecedented. [ 1 ]
- The industry says labor, logistics, cooking oil, packaging, delivery platform commission and franchise operating costs have also risen, and that headquarters delayed past price increases when raw chicken prices rose. [ 1 , 3 ]
- The industry also says final pricing authority rests with franchisees, making it difficult for headquarters to force prices. [ 1 , 3 ]
- Prices have been unchanged since bhc's last increase in December 2023, Kyochon's in April 2023 and BBQ's in June 2024. [ 1 , 3 ]
Confirmado por varias fuentes
- FTC investigators conducted on-site inspections at bhc, BBQ and Kyochon Chicken headquarters on Oct 6. [ 1 , 2 , 3 ]
- The inspections relate to whether the chicken franchise industry coordinated prices. [ 1 , 2 , 3 ]
- President Lee Jae-myung shared an article on social media on Sept 30 about chicken prices and said he would look into the matter. [ 1 , 2 , 3 ]
- The cost structure and pricing process of the chicken franchises, including the sharing of costs between headquarters and franchisees, is part of the review. [ 1 , 3 ]
- Prices at bhc, Kyochon and BBQ have not changed since their last increases in December 2023, April 2023 and June 2024 respectively. [ 1 , 3 ]
Aún sin aclarar
- Whether price collusion actually took place. The documents describe an investigation to establish whether collusion occurred; no finding is reported, and industry sources cited by Yonhap and Hankook Ilbo say the possibility is low.
- Whether the FTC opened the investigation because of the president's social media post. Yonhap, Hankook Ilbo and Korea Economic Daily link the timing to President Lee's Sept 30 post, but the documents attribute the account to industry sources and do not cite an FTC statement.
- What the FTC's next steps or possible penalties are. The documents report only the on-site inspections and say no more about the outcome.
Qué dicen los medios locales
Cronología, hora local
- Yonhap reports that the Fair Trade Commission sent investigators to the headquarters of bhc, BBQ and Kyochon Chicken that day over possible price collusion. [ 1 ]
- Chosun Ilbo reports that FTC inspectors visited the three companies' headquarters to examine collusion-related materials, after the president shared an article on X on Sept 30. [ 2 ]
- Hankook Ilbo reports the same inspections and the industry's arguments on costs and franchisee pricing authority. [ 3 ]
- Korea Economic Daily reports the FTC launched the price-collusion investigation six days after the president's comments on chicken prices. [ 4 ]