KOREA: Watchdog clubs local distillers

The Fair Trade Commission reprimands Jinro Soju for comparative advertising in newspapers

The Korea Herald
Friday, May 25, 2007

By Choi He-suk

Comparative advertising campaigns by producers of soju -- traditional Korean liquor -- will be subjected to stricter regulations by the Fair Trade Commission.

The FTC said yesterday after it concluded that comparative advertising campaigns carried out by Jinro Co., Ltd. and Doosan Liquor BG, the largest and the third largest manufacturers of soju, last year had violated the fair trade laws. The two companies' share of the country's soju market was recorded at 61.2 percent in September 2006. Their share of the market in Seoul and Gyeonggi Province is over 98 percent.

Concerning Jinro's advertisements, the FTC ruled that the company had damaged Doosan's brand image and misled consumers.

Through its newspaper advertisements, printed between July and August of last year, Jinro emphasized that electricity was used in the production of Doosan's soju brand by associating the liquor with electrocutions. The company's advertisements also indicated that its soju brand was less likely to cause hangovers.

The FTC also ruled that Doosan's advertising tactics also had elements that could mislead consumers to believe that Jinro's products were inferior to its own brands.

Doosan's violation of laws relating to advertisements had also occurred in August last year, when the company implied that Jinro had imitated the company's production methods through newspaper advertisements.

Date Posted: 5/25/2007