Government

Korean regulators halt forced kiosk purchases

Photo: Adobe Stock

March 10, 2026

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South Korea's Fair Trade Commission has issued a corrective order to Hotseasoner, the operator of the Dongdaemun Yupdduck restaurant chain, for requiring franchisees to purchase certain electronic equipment through the company or its designated vendors. According to the FTC, the company mandated the purchase of point-of-sale terminals for more than 12 years, from April 2013 through August 2024. Beginning in September 2024, the list of required equipment was expanded to include kiosks and digital information displays, according to a report in the online news publication ChosunBiz.

Hotseasoner's franchise agreements required operators to obtain these systems exclusively from the headquarters or approved suppliers, with provisions that allowed the company to restrict supply, terminate franchise agreements or impose penalties if franchisees purchased the equipment from other vendors. However, regulators found that the devices involved were standard commercial products that could be easily purchased on the open market with comparable functionality.

In August 2024, the company changed its policy, reclassifying the previously mandatory equipment as "recommended" rather than required.

The FTC concluded that the earlier policy constituted an unfair restriction on franchisees' choice of suppliers under South Korea's Fair Transactions in Franchise Business Act. As a result, franchisees will now be able to independently select vendors for high-cost electronic equipment such as POS systems and kiosks, potentially allowing them to purchase lower-priced alternatives.