User:Chrischapstick/sandbox

During the 1970s, the national government started to monopolize the soju industries. By the 1970s there were about 300 domestic soju companies. In 1973, the Korean government began to consolidate various local soju producers. Each province was designated one soju producer per regional market. Each producer was to create a brand of soju that represented its region. By the end of the consolidation, a producer existed for each of the provinces. The government then passed two policies. The first was a mandatory local soju purchase policy. The policy required each provincial alcohol wholesaler to purchase more than 50 percent of their soju from within their own province. The second was the input allocation policy. This policy gave the government the responsibility to administer ethanol spirit, the main ingredient in soju. Each soju company was designated an amount based on their national market share in the previous year. These policies were created with the intention of protecting local firms and discouraging excessive competition.

This decision by the government advanced the efficient control of tax revenue. As a result of this consolidation, a few companies began to dominate the market. As of October 2023, one firm, HiteJinro, accounts for almost half of the market while 4 smaller companies accounts for another 40 percent.

Due to the protection by the government's policies, local firms took the majority of market share in their regional markets. In the 1980s and 1990s, there was a trade liberalization trend which led the Korean government to begin deregulating the soju industry. The government lifted its restrictions on new licenses for alcohol distribution in January 1991. It also lifted restrictions on soju production in March 1993. Various restrictions on the production of soju were also removed or weakened. The government also abolished the mandatory local soju purchase policy in January 1992.

Between 1993 and 1995, HiteJinro's market share in regional markets outside its own increased and local companies saw a steady decline. As a result of this loss in market share, local soju companies lobbied to reintroduce the protection policies that had been removed. In response, the National Assembly of South Korea reintroduced the mandatory local soju purchase policy in October 1995. However, the case was challenged and the case was eventually decided by the the Supreme Court of Korea that the policy was unconstitutional and abolished it in December 1996.