Republic of Korea: Fair Trade Commission imposed a corrective order and a fine of KRW 390 million on Kakao over deceptive advertising practices

On 24 March 2025, the Fair Trade Commission (FTC) issued a fine against Kakao Entertainment (Kakao) for engaging in deceptive advertising practices. The FTC imposed a corrective order and a fine of KRW 390 million on Kakao for misleading promotions of its music and albums on social media and online communities. Kakao holds a 43% share of South Korea's music distribution market as of April 2023, distributing music and albums from both its own artists and others through online platforms. Its revenue structure is influenced by sales and consumption of the music it distributes, particularly that of its own artists. The FTC found that Kakao used misleading advertising on social media and online communities to increase sales and consumption, potentially inflating the perceived popularity of its music and albums.