Naver and Daum get the go-ahead from FTCFor the first time, the Fair Trade Commission (FTC), the antitrust watchdog, said yesterday it had accepted a consent decree, a plan for self-corrective measures submitted by leading portal sites Naver and Daum for abusing their market dominance.
Small and midsize businesses that provide content to the Web portals have accused them - especially Naver - of setting unfairly high prices for keyword advertising and other services.
The portal giants have been under investigation since last May for potential violations of the antitrust law.
They could have faced fines of tens of billions of won as Naver has also been a prime target of monitoring by the Park Geun-hye administration, which has pursued policies of shared economic growth.
The FTC received the consent decree, a fast-track mechanism by which a company subject to an antitrust investigation can proceed with self-corrective measures, last November.
At the time, Naver said it would voluntarily provide 100 billion won ($93.6 million) and Daum 4 billion won over three years to support small and midsize enterprises.
Later, the portal companies also suggested they would improve their services so users could easily distinguish keyword advertisements and paid services from search queries.
The FTC put the consent decree on hold late last month, saying that measures proposed by the portals lacked specifics, and requested more details.
In addition to Naver paying 100 billion won and Daum 4 billion won for the shared growth of small and midsize businesses, the two portals said they would improve their search result systems.
Naver and Daum will mark keyword advertisements with shading and add their company name next to paid services such as “Naver Real Estate” or “Naver Shopping.”
They will also notify users of policy changes affecting paid services and keyword advertisements.
By adhering to the self-corrective measures accepted by the watchdog, Naver and Daum will avoid FTC sanctions.
“It is the first time that the FTC has accepted a consent decree. We believe the consent decision represents a new solution that could rapidly improve unfair business practices in the innovative online search and portal markets,” said a spokesman for the FTC.
The FTC will inspect the portal companies each quarter to check on implementation of the measures. If the companies violate the decree, they will be subjected to fines of 2 million won per day and the cancellation of the decree.
“We welcome the government’s decision and plan to fulfill the resolution conscientiously for the benefits of the users, shared growth with small and midsize businesses, and improvement of the market environment,” said a spokesman for Naver.
BY KIM JUNG-YOON [firstname.lastname@example.org]
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