The Fair Trade Commission plans to investigate commission fees at the nation’s top three department stores next month, an official said Monday.

The investigation is allegedly aimed at Lotte, Shinsegae and Hyundai department stores that have given favors to foreign luxury brands with lower fees, the official said.

Smaller traders have been increasingly critical of the high commission fees and other contract conditions that major department stores, supermarket chains and home-shopping channels have imposed.

Earlier this month, the antitrust regulator had agreed with 11 CEO of major retail giants to lower their commission fees about 3 to 7 percent from October.
Foreign luxury brands, however, have been enjoying relatively lower fees as retailers, mostly department stores, compete to attract them to earn a premium image.

“Small- and medium-sized companies have paid 30 to 40 percent of wholesale costs for the fees to use floor space. But the retail giants are said to have charged luxury brands with single-digit rates or no fees to attract them,” the FTC official was quoted as saying in an interview.

The investigation will be completed by the end of this year and the results will be disclosed to public, the official added.

“Through this investigation, we will also look into whether smaller traders are charged with additional fees such as costs for promotional activities and model guarantees,” he said.

By Lee Ji-yoon (jylee@heraldcorp.com)