More firms face unfair deal charges

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More firms face unfair deal charges

Korean firms have recently faced legal action taken by governments in the United States and Europe for unfair business dealings that violate anti-trust rules, such as involvement in cartels and dumping. The punishments, previously confined to fines, are also changing: Four Hynix Semiconductor Inc. managers were sentenced to prison terms last week and two top semiconductor makers have faced damage suits from consumers. In addition, the industries under investigation have widened to include electronic appliance manufacturers. According to a 2005 audit report by Samsung Electronics Co., its U.S. affiliate set aside $67 million to settle a damage suit filed by a group of U.S. consumers for fixing prices of dynamic RAM chips. The company said the expense is separate from the $300 million it agreed with the U.S. Department of Justice last November to pay in penalty for the same case. Hynix Semiconductor, the world’s second-largest memory chipmaker, is also in negotiations with individual U.S. consumers for damages. The company said overall payments would be around 160 billion won ($165 million). This will be the first time Korean companies have paid damages after for a class action by foreign consumers. Foreign governments’ anti-trust investigations into Korean companies are expanding, also. According to the Korea International Trade Association, the European Union last week slapped heavy provisional anti-dumping duties on Korean-made side-by-side refrigerators with a capacity of 400 liters or more. The measure came after the U.S. appliance maker Whirlpool lodged an allegation against LG Electronics Inc., Samsung Electronics and Daewoo Electronics Co. Lee Seung-cheol, director of the economic research division at the Federation of Korean Industries, said, “As made-in-Korea products gain popularity in overseas markets, governments and rival firms are increasingly attempting to offset their influence.” Amid a series of alleged unfair business activities by Korean companies, the nation’s anti-trust watchdog is to raise the fines levied on companies engaging in unfair business dealings and file complaints with the prosecution to investigate those involved. The commission revealed yesterday that the number of cartel cases it levied penalties on totaled 21 cases last year and the following consumer damage amounted to almost 1 trillion won, triple the amount in the previous year. by Seo Ji-eun
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