The Fair Trade Commission is conducting an official investigation into Kakao Entertainment. Kakao Entertainment is tied to SM Entertainment, one of the biggest entertainment companies in South Korea and the company currently embroiled in a legal squabble against EXO-CBX and their new representation.
The on-site investigation began on June 10, 2024. Its purpose is to determine if Kakao Entertainment was discriminating against and targeting artists unfairly when charging music distribution fees. Big Planet Made made a report to the Fair Trade Commission earlier this year, requesting the investigation.
In the midst of all of the drama, the artists themselves have finally spoken up about it. EXO-CBX made an official statement saying, “SM has been abusing and charging discriminatory music distribution fees, which was an issue in the previous press conference. It has been proven that SM Entertainment’s behavior is the essence of this situation.”
The trio’s representation said: “This is something that casts doubt on Kakao Entertainment's claim that 'Whether or not it is a Kakao affiliate is not a consideration at all for calculating distribution commission rates.’ At the same time, it appears that SM is providing evidence proving Kakao Entertainment's inappropriate practices. The act of using fees as a tool to renew artists’ contracts was clearly revealed through the evidence released at the press conference, but SM Entertainment is trying to divert the public’s attention by misleading the true nature of the problem.”
“We plan to actively cooperate by submitting the relevant evidence we have so that the faults in this situation can be clearly identified through the Fair Trade Commission," said EXO-CBX. "The Fair Trade Commission's judgment will objectively reveal the nature of this situation."