South Korea: Beer industry competition leads to police raid

Police raided the offices of Korea’s No. 2 beer maker Hite Jinro Co. and one of its provincial agencies on September 3 in connection with suspicions that the company spread malicious rumors against its bigger rival Oriental Brewery (OB), Yonhap News reported.

Police investigators seized computer hard drives and other documents from Hite Jinro's headquarters in southern Seoul and the local sales agency based in the central city of Daejeon.

The raid came after OB, the No. 1 player in South Korea's beer market, requested a police investigation into allegations that some market forces are spreading ill-willed rumors against Cass, OB's best-selling beer brand.

Since June, OB has been gripped by online rumors that Cass beers smell of disinfectant.

Police reportedly found that Hite Jinro employees were involved in the circulation of the rumor against the No. 1 beer maker.

Following the raid, police plan to question some of the firm's employees over the case.

Amid the rampant rumor spreading through online social networking services, food and drug authorities have said that the cause of the particular smell in Cass beers is attributable to a chemical reaction made when the fat element of malt, used in making beer, meets with dissolved oxygen.

South Korea's beer market is dominated by the two rivals that together control more than half of the total beer sales in the country.

05 September, 2014