 |
|
The Fair Trade Commission's Seoul branch, which was opened on January of this year.
|
Punishment becomes more stringent, even as firms fleece consumers out of $1 billion this year
The Fair Trade Commission (FTC) estimated that South Korean consumers have suffered record damages due to price-fixing cartel situations created by domestic companies this year. The amount of loss surpassed an estimated 1 trillion won (US$1.09 billion) for the first time.
According to the FTC on December 14, as of the end of November this year, 39 separate cases of collusion caused damages of about 1 trillion won to consumers, compared with about 997 billion won in damages last year and 311 billion won in 2004. According to the Organization for Economic Cooperation and Development (OECD) model adopted by the FTC, the amount of losses suffered by consumers owing to cartels accounts for 10 percent of total sales figures.
The antitrust watchdog has imposed fines amounting to about 109 billion won for collusion through the end of November. If the investigation of an alleged cartel in the petrochemical industry is settled within the month, the amount of fines levied this year is expected to surpass 300 billion won. The previous high was last year's 262 billion won.
An official of the FTC said, "With more than 10 companies involved in the cartel of the petrochemical industry, the fine would be about 200 billion won, the largest amount for a single case.''
More stringent punishment for cartels is a tendency worldwide. The United States raised its fine ceiling from $10 million to $100 million in 2004. The nation also strengthened punishment for individuals. The European Union (EU) set up a cartel bureau in June last year and has since been adding staff. O Haeng-rok, an FTC official, said, "South Korean firms were fined a total of about 511 billion won by the U.S. for setting up cartels, and the situation is getting worse.'' The fair trade authorities of each nation have stepped up international cooperation. The FTC has recently launched probes regarding price-fixing cartels between Samsung Electronics and LG Phillips LCD, and the antitrust watchdog will conduct investigations of over 10 of the world's LCD TV makers in collaboration with nations including the U.S. and Japan. Please direct questions or comments to [englishhani@hani.co.kr]
