South Korea Tightens Penalty Standards for Large Retailers' Fair Trade Violations

South Korea’s Fair Trade Commission has re-issued a public notice proposing tighter penalty standards for large retailers that violate the Act on Fair Transactions in Large Retail Business, raising base penalty rates and extending the repeat-offence look-back period. The re-notice, Fair Trade Commission Notice No. 2026-215, was published in the Official Gazette (관보) No. 21324 of 17 September 2026, Section I, and reopens public comment until 6 October 2026.

The document amends the “Notice on Penalty Imposition Standards for Business Operators Violating the Large-Scale Retail Business Act.” The Fair Trade Commission states the revision is intended to strengthen the recovery of unjust gains and the deterrent effect of the penalty system, by overhauling the imposition framework, the base rates, the aggravation rules for repeat violations and the grounds for mitigation. It follows an earlier administrative pre-announcement, Fair Trade Commission Notice No. 2026-200, published on 27 August 2026, whose comment period closed on 16 September 2026; the re-notice extends that deadline.

What the draft changes

• The penalty ceiling is revised and the calculation basis is changed, with a new definition of “related supply payment” introduced.
• Base rates applied to the violation amount are raised.
• A new base rate of 1% to 10% is created for related supply payments.
• The period used to count violations for repeat-offence purposes is extended from three years to five years.
• A single repeat violation now triggers a 50% increase, and aggravation can reach 100% depending on the number of violations.
• Mitigation is tightened: the self-correction discount is unified at a maximum of 10%, and a maximum 10% discount applies only where the operator cooperated at every stage of the investigation and deliberation.

Companion decree amendment

The penalty notice runs in parallel with the amendment to the Enforcement Decree of the Act on Fair Transactions in Large Retail Business, pre-announced as Fair Trade Commission Notice No. 2026-199 on 27 August 2026. That draft changes the penalty ceiling to the average supply payment, makes the violation amount the principal calculation basis — with related supply payments used where calculation is difficult — and raises the aggravation ceiling for the duration and number of violations from 50% to 100%. Both instruments address the same conduct by large-scale retailers and their suppliers.

How to submit comments

• Deadline: 6 October 2026.
• Channel: the National Participation in Legislation Center (opinion.lawmaking.go.kr), or a written opinion sent to the Fair Trade Commission Chairman.
• Postal address: (30108) 95 Dasom 3-ro, Sejong; Distribution and Agency Policy Division, Fair Trade Commission.
• Email: kindwook1@korea.kr; fax: 044-200-5227; enquiries: 044-200-4961.
• The full draft is available on the Fair Trade Commission website under its legislative and administrative pre-announcement section.

The revision matters because it changes the arithmetic of enforcement for the country’s largest retailers and, indirectly, for the suppliers that deal with them. A five-year look-back and aggravation of up to 100% make repeat breaches substantially more expensive, while the new 1% to 10% rate on related supply payments gives the Fair Trade Commission a lever where the violation amount is hard to quantify. Suppliers now have until 6 October 2026 to say whether the proposed rates and mitigation rules strike the right balance.

Source: Official Gazette (관보), No. 21324, 17 September 2026, Section I (공고), p. 33 (official reference: Fair Trade Commission Notice No. 2026-215).