South Korea’s competition watchdog, the Korea Fair Trade Commission (KFTC), has revealed its decision to levy fines totaling KRW 33.6 billion (approximately $25.06 million) on three major domestic mobile carriers.
The sanctions were imposed due to allegations of these telecommunication companies, namely SK Telecom Co Ltd, KT Corp, and LG Uplus Corp, embellishing the speeds of their 5G networks and engaging in unfair promotion practices, falsely claiming superiority over their rivals regarding network velocity.
The KFTC’s move arrives in response to concerns about manipulating 5G network performance claims. The authority’s decision to impose these fines aims to deter misleading advertising within the industry and ensure a level playing field for all market participants.
“The three telecom companies advertised that consumers could use target 5G network speeds, which cannot be achieved in real-life environments.” the KFTC said in a statement.
“Companies advertised that their 5G network speed was faster than competitors without evidence,” the statement added.
The KFTC expressed its aspiration that this action would encourage the three enterprises to distance themselves from intense competition fueled by unjust promotional practices.
According to a statement by the Korea Fair Trade Commission, the trio of South Korean firms, namely SK Telecom, KT, and LG Uplus, have been cited for advertising their 5G network speeds as superior to competitors, despite lacking substantiating evidence.
The regulator’s investigation concluded that not only did these telecommunication entities magnify their 5G speeds, but they also engaged in unfair marketing tactics that falsely portrayed them as the fastest compared to their rivals.
SK Telecom and KT Corp opted for silence, refraining from issuing comments in response to the fines. Meanwhile, an LG Uplus spokesperson conveyed that the company is evaluating the penalties imposed upon it.
An official from the KFTC shared that the fines levied on each company would vary in magnitude, with specific amounts slated for disclosure on Thursday.
These measures were taken in light of the regulator’s presentation of evidence related to deceptive advertising to a local court, substantiating its stance and aiding ongoing civil lawsuits on the matter.
In June, South Korea had a user base of 30.76 million individuals connected to 5G networks, constituting approximately 38% of the overall 80.23 million mobile subscriptions nationwide.
The KFTC’s enforcement of fines stands as follows: SK Telecom faces a penalty of 16.8 billion won (RM58.26 million), KT Corp is to pay 13.9 billion won (RM48.20 million), and LG Uplus has been ordered to pay 2.8 billion won (RM9.71 million).
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