South Korea's Fair Trade Commission (FTC) will be able to demand business registration cancellations or operational suspensions for companies that repeatedly engage in cartel behavior. The regulator is also pushing measures that would allow it to order the dismissal or suspension of executives who lead such conduct.
FTC Chairman Joo Byung-ki announced the "Plan to Eradicate Repeat Cartels" at a task force meeting of ministers on special management of consumer prices on Tuesday. The move aims to root out collusion by raising sanction levels, as cartel cases have recurred in key sectors including sugar, flour, and printing paper.
The plan first seeks to restrict market participation by cartel firms. The FTC plans to revise the law so it can request that relevant ministries impose operational suspensions or revoke registrations and licenses for repeat cartel offenders.
The commission is also pushing to introduce a system allowing it to order the dismissal or job suspension of executives who lead collusion. For industries where cartels recur, it will review introducing structural measures such as corporate splits, equity divestitures, and business sales.
The government has been stepping up detection of collusion and raising punishment levels this year. The Seoul Central District Prosecutors' Office Fair Trade Investigation Division (led by Chief Prosecutor Na Hee-seok) said Tuesday it has indicted a total of 25 people, including the corporate entities and executives such as CEOs of three starch sugar firms — Daesang, Sajo CPK, and CJ CheilJedang — on charges of violating the Monopoly Regulation and Fair Trade Act. The scale of their cartel reached 10.152 trillion won ($7.3 billion), the largest food cartel case on record in Korea.
The FTC also uncovered a 4 trillion won cartel in the paper industry that day, imposing fines of 138.3 billion won ($99 million). This is the fifth-largest penalty ever in a cartel case. The FTC also issued a price redetermination order for the first time since the 2006 flour cartel case. Under the order, the six paper companies caught in the case must recalculate their product prices on their own within three months and report them to the FTC.
