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Caffe Bene Receives Huge Fine

THE HAPS

South Korea’s antitrust watchdog said today that it has fined Caffe Bene, the country’s largest coffee franchise, 1.94 billion won or $1.88 million US dollars, for abusing its market power in deals with shop owners. 

The Fair Trade Commission (FTC) accused Caffe Bene of forcing shop owners selling coffee under its brand to bear full costs related to a promotional event jointly arranged with KT Corporation in 2010, to provide discounts to customers of the mobile carrier.

Caffe Bene was supposed to shoulder half of the costs, but it reneged on its deal with shop owners and transferred all of the costs to them, the FTC said.

The FTC also accused the coffee chain of forcing shop owners to use its interior materials and devices when opening a shop. It earned 181.3 billion won in sales from such practices, which lasted from November 2008 to April 2012, according to the FTC. That accounted for 55.7 percent of the company’s total sales during the period.

Launched in November 2008, Caffe Bene has emerged as the country’s largest coffee franchise with 850 shops being operated under its brand as of the end of 2013. It also runs seven shops in U.S. cities, including New York and Los Angeles.

Source: Busan eFM News

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