The company is found to have restricted discounts.
South Korea’s Fair Trade Commission (FTC) has slapped Dunlop Sports Korea with a hefty fine for restricting retailers from offering discounts on its golf clubs. The move was deemed an illegal restraint on competition.
Dunlop Sports Korea will be fined $1.29 million for violating fair trade laws by imposing resale price maintenance and unfair trade terms on its dealers from 2020 to 2023.
Dunlop, which is the exclusive importer and distributor of the popular A-brand golf clubs in South Korea, is alleged to have set minimum selling prices for both online and offline sales. Dealers who violated the policy faced penalties, including supply restrictions on high-demand models, withdrawal of financial incentives and even termination of business agreements.
To ensure compliance, Dunlop reportedly conducted undercover inspections of retailers several times a year, sending disguised customers into stores and monitoring online listings daily. When it detected violations, it would impose punitive measures, effectively eliminating price competition among distributors.
The company was also found to have pressured authorized dealers to block resales to unaffiliated retailers, preventing independent stores from undercutting prices.
