[THE INVESTOR] The controversial anti-graft law governing free meals and gifts is expected to have a negative impact on some sectors while coming as a boon to others, sources said Aug 8.
Slated to go into effect on Sept. 28, the Kim Young-ran anti-graft law named after a former head of the Anti-Corruption and Civil Rights Commission is designed to bring more transparency among public officials, journalists and private school faculty.
The law makes it illegal to accept meals exceeding 30,000 won (US$26.95), presents in excess of 50,000 won, and money for congratulations or condolences of over 100,000 won.
Market watchers said the anti-corruption law is feared to hit major department stores hard as the bulk of their gift sets carry a price tag of more than 50,000 won.
Lotte Department Store, the flagship of retail giant Lotte Group, said 85 percent of its gift sets sold during last year’s Chuseok, or fall harvest, holiday were worth more than 50,000 won.
A market source said local department stores will be hit hardest by the anti-corruption law once it takes effect late next month.
In contrast, discount chains and convenience stores are expected to go relatively unscathed as much as some 90 percent of their gift sets sell for below 50,000 won.
The local food industry also stands to bask in the implementation of the anti-graft law, which will make people opt for cheaper gifts. Approximately 90 percent of their holiday gift sets carry a price tag of less than 50,000 won.
