Shinsegae department store in Incheon Terminal
South Korean retail giant Lotte won a five-year-long legal battle with its rival Shinsegae over business rights to a department store in the western city of Incheon, a decision that will speed up its plan to build a major shopping complex in the vicinity of the country’s primary gateway.
The Supreme Court on Tuesday upheld the lower court ruling that sided with Lotte in a dispute over its land purchase from the Incheon city government in 2012.
Shinsegae had operated its department store in the Incheon transit terminal since 1997 based on a 20-year lease agreement with the Incheon government. But problems emerged when Lotte bought the 77,815 square-meter terminal for 900 billion won ($804.9 million) in 2012. Shinsegae filed a lawsuit against Lotte and the Incheon government, accusing the city of granting Lotte benefits in order to seal the deal at a higher price.
The Supreme Court agreed with the lower courts in rejecting Shinsegae’s claim that Lotte received preferential treatment, saying that the city provided the same opportunity to other bidders during the sales process.
Shinsegae’s Incheon branch rakes in about 800 billion won a year, making it the retailer’s fourth largest outlet in the country.
Lotte plans to set up a major shopping complex consisting of a department store, cinema, shopping malls and residential units in the combined 135,500 square-meter space.
A Lotte Department Store official said the company respected the Supreme Court’s decision, adding that it aims to make the terminal an Incheon landmark.
By Lee Han-na and Kim Hyo-jin
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]