The top corporate regulator has pledged to tackle such practices and strengthen the role of the FTC to resolve the matter.

Kim, a former civic activist, said he will keep monitoring large business groups who abuse their market dominance and exert undue pressure on subcontractors and small-time enterprises.

The FTC chief also vowed to carry out sweeping reforms to root out unfair business practices and strengthen consumer protection.

Earlier, the FTC unveiled a plan to impose punitive damages of up to three times the actual losses incurred by illegal business practices, such as unfair payment, returns and cutting back supplied goods, that occur between large shopping mall operators and smaller partners.

The South Korean distribution industry is currently led by huge retailers, department stores and discount outlets that lease their spaces to small businesses. Big-name retail giants such as Lotte, Shinsegae and Hyundai Department Store take up the bulk of the market share and wield great influence over the entire industry.

"The steps we draw up will be predictable and irreversible, and our society will be better going forward on the back of such measures," Kim said.

"Tangible outcomes will be created ... but I will not be in hurry," he said. (Yonhap)