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Golfzon sanctioned for price fixing

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A range at an indoor screen golf club is seen in this undated file photo. Yonhap
A range at an indoor screen golf club is seen in this undated file photo. Yonhap

By Lee Min-hyung

The Fair Trade Commission (FTC) ordered Golfzon, the country's largest indoor screen golf system maker, to stop its price-fixing practices after it was found to have helped some of its franchisees collude in order to charge customers more, the antitrust agency said Tuesday. The FTC said the company exerted influence in May 2021 to help its affiliated indoor golf clubs in Daegu engage in price collusion.

At that time, an owner of a golf club expressed complaints to the headquarters, saying that some other Golfzon-affiliated clubs nearby hold frequent promotional activities by issuing coupons. The owner ― whose name was not revealed ― argued that the club fell victim to its competitors, as customers increased their complaints that its fees were more expensive than those issuing coupons.

The owner demanded that the head office take specific actions against the excessive competition by issuing discount coupons more frequently.

The headquarters then held a meeting with a group of owners of its affiliated screen golf clubs. Four out of the seven affiliated clubs in the region joined the meeting and decided to stop issuing coupons and offering special discount events for their customers, which the watchdog viewed as a clear example of price fixing.

Golfzon argued that the head office hosted the meeting, with a view to prevent its corporate brand image from being tarnished, and that the act was in accordance with the terms of the franchise agreement. However, the FTC did not accept their argument.

"Golf club users ended up paying more after the act of price collusion between Golfzon and its affiliated stores," an official from the authority said.

The FTC said the business practice could be seen as an excessive act that hinders fair competition and is detrimental to customers, following the apparent act of collusion by the clubs.

The watchdog ordered Golfzon and its three affiliated indoor clubs in the southeastern city to rectify their business practices. The FTC also pledged to toughen its monitoring of such acts and take stern regulatory measures against those caught engaging in any similar practices that limit free competition in the indoor golf club service market.

Lee Min-hyung


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