Fair Trade Commission Orders SM Entertainment to Stop Hindering JYJ Activities

Korea’s Fair Trade Commission (FTC) has imposed a correction order upon SM Entertainment and Korea’s association on pop culture and arts for hindering JYJ’s promotional activities. When JYJ released their first album in October 2010, SM and the Korea Pop Culture and Arts Industry Coalition (translated title) interfered with JYJ’s promotional activities, the FTC stated in a press release on Wednesday. The FTC then explained that SM and Korea Pop Culture and Arts Industry Coalition sent out notices to 26 companies, including broadcasting companies and distribution companies, that discouraged them from allowing the trio to appear on television programs or promote their music career. Korea Pop Culture and Arts Industry Coalition, launched in July 2009, is an association of twelve major entertainment-related companies including Korea Entertainment Producer’s Association, Corea Drama Production Association and SM Entertainment that aims to develop Korea pop culture and arts industries. Due to the influence SM has as one of the top three talent agencies in Korea, and the Korea Pop Culture and Arts Industry Coalition’s leverage in the entertainment industry, the notices they sent out had a considerable impact, the FTC said. JYJ members Yuchun, Junsu and Jaejoong parted from their original group TVXQ! after taking legal action against their former agency SM for injustice regarding their contract in 2009. SM had punched back at them by publicly, accusing the three as committing a ‘national fraud.’ Three long years later, the two parties finally came to an agreement and ended their contracts in November 2012. The two also agreed not to interfere with each other’s activities. However, SM and the Korea Pop Culture and Arts Industry Coalition sent out the notices even during the legal battle, the FTC stated. Despite JYJ’s popularity, the group was not able to make it to major music charts in Korea and their viability in the Korean pop culture and Korean wave has decreased. Accordingly, JYJ members were only able to promote themselves through musicals, drama and overseas activities which are relatively free from such external pressure. Through the correction order, the FTC expressed its determination to change the entertainment business and sound the alarm for fair contracts. Most recently, JYJ member Junsu’s latest album had been on the verge of facing difficulties promotion his album when the album’s promoter, Loen Entertainment, suddenly notified Junsu’s agency C-Jes Entertainment that they decided not to promote and market the album earlier this month. In response to the FTC’s announcement, C-Jes Entertainment CEO Baek Chang-joo said through a separate press release today that JYJ has been suffering from unfair external pressure even after their agreement with SM was settled. Junsu, who recently released a new album, is also having a hard time because he cannot make an appearance on the broadcasting television music programs. He also added that this investigation proved that SM has abused its monopolistic and superior position in the entertainment industry and imposed disadvantages to other parties by violating the Fair Trade Act. SM distributed a press release as well, stating that it is unfortunate that they were imposed with the correction order by the FTC even though they have never interfered with JYJ’s promotional activities. Thus, SM will consider taking legal action against the order, the statement said.

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