South Korea's Pizza Hut Ordered to Return ₩21.5 Billion Over Undisclosed Franchise Fees
Creatrip Team
2 months ago
South Korea's Supreme Court ruled that Pizza Hut Korea must repay 21.5 billion won (about ₩215억원) collected from franchisees as so-called "price-difference franchise fees". The court said such fees are a form of franchise charge under the Franchise Business Act and require explicit, specific agreement between franchisor and franchisee; no such agreement or valid implied consent existed in Pizza Hut's contracts. The decision upholds lower-court rulings covering fees collected from 2016–2022 and noted that failure to document fees or provide required disclosures justified using estimates for certain years. The ruling could influence similar lawsuits by franchisees of other Korean brands. (차액가맹금: a wholesale margin collected by franchisors when supplying ingredients or goods to franchisees)
