South Korean retail giant Lotte Group is stepping up efforts to defend two of its duty-free stores in downtown Seoul whose operational licenses are nearing expiration, in the face of challenges from other retailers eyeing the lucrative bid.
  

Lotte Duty Free, the nation's No. 1 operator and the world's fifth-largest, said Wednesday it will submit bids with the Korea Customs Service for two stores in Seoul as their operational licenses are set to expire in December. One is located in major shopping district Myeongdong and the other is in the affluent Gangnam region,
  

Lotte has comfortably led the nation's duty free market since opening its first store in downtown Seoul 35 years ago, but it faces a critical test this time under a new law that requires existing operators to compete with other bidders to renew their licenses.
  

Although considered to have a competitive edge over other rivals with stores located in tourist areas and strong brand power, Lotte has made desperate efforts to defend its licenses after a bitter succession feud between the founder's two sons hurt the retailer's image.
  

Established as a confectionery store in post-war Japan in 1948, founder Shin Kyuk-ho later expanded the business into his home country and fostered it into a sprawling business empire with 74 affiliates in 20 countries, and a business portfolio ranging from food and leisure, to chemical and construction.
  

But a recent family feud for succession has drawn public backlash, prompting some lawmakers to pressure the customs agency to reconsider Lotte's duty-free licenses, citing the retailer's dominance in the market.
  

Last year, the six duty-free stores across the capital, mostly dominated by Lotte, posted combined sales of 4.4 trillion won ($4 billion). Sales by a Lotte Duty Free branch in the Myeongdong area accounted for a whopping 45 percent of the total.
  

As part of efforts to restore its image, Lotte said it will renovate the current duty-free stores and develop entertainment and tour package programs to attract more foreign tourists, aiming to drawing 13 million foreigners in the next five years,
  

The upcoming bid for new licenses is a major opportunity for local retailers in search of a new growth engine to overcome the lackluster domestic demand on the back of rising influx of Chinese tourists.
  

Shinsegae, the nation's retail conglomerate, and Doosan, a machinery and construction conglomerate, have announced their bids for the duty free stores in Seoul.  (Yonhap)