[EDITORIALS]Fair Trade or Intimidation?

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[EDITORIALS]Fair Trade or Intimidation?


The Fair Trade Commission announced that it would revive and strengthen the "Types and Standards of Unfair Trade Actions in the Newspaper Business (Newspaper Bulletin)," which was repealed in 1999, in a bid to prevent "excessive" competition in the business. Our stance is that no business should remain sacrosanct, including the print and broadcast media. Therefore, there should be no exceptions when it comes to legitimate procedures, be they the tax audits or investigations into unfair trade actions, and we will not spare any cooperation in these matters. This stance notwithstanding, we find it questionable why the Fair Trade Commission is suddenly compelled to revise the Newspaper Bulletin in such haste.

As the commission embarked on a media probe aimed at newspaper companies on February 12, it said, "The investigation will last until the end of March and, if necessary, some systematic mechanisms for fair trade will be prepared." At present four newspapers are under close scrutiny as primary targets. If the commission waits a little longer, sufficient data on which to make judgments will be available. Then why has it suddenly changed its stance? Has there been an unexpected change of circumstances?

The commission explains that it has decided to strengthen external regulations because the covenant on fair competition by newspapers, drawn up in 1996, has not been kept well. It could be true that there have been many violations. That was why the Korean Newspaper Association has completely banned the distribution of incentive gifts and prolonged free deliveries, the two main factors fostering unfair competition, since November 2000, and greatly upped the penalties in case of violations. Without waiting for the outcome of such voluntary efforts, hurrying up with the revival of the regulation, which the government deemed unnecessary as recently as two years ago, invites suspicions of other intentions on the government's part.

The Fair Trade Commission also said, "Even if the combined market share of the three largest newspaper companies does not reach 75 percent, if it is judged that the big three have control of the market in practical terms, we will view them as monopolies and oligopolies." It is problematic to resort to such a vague standard as "practical" without objective grounds, such as sales, in that the government is liable to exert deliberate influence. How will the government deal with the reality that three over-the-air television stations make up almost 100 percent of the market? In order to differentiate free deliveries and incentive gifts from true paid circulation, as the commission asserts, it is essential to have the exact circulation numbers from a trustworthy Audit Bureau of Circulation. It is possible to punish rampant practices ?printing advertisements first and then demanding money, or coercive selling of advertisements in exchange for positive articles about certain companies ?by existing means such as criminal laws. Furthermore, in a situation where tax audits and investigations into unfair trade are under way simultaneously, the commission's haste in reviving the bulletin gives birth to the interpretation that it is a prepared course of action to pressure the media on all fronts.

If the Fair Trade Commission, the prosecution and tax auditors are called into action for non-economic goals, or invite such suspicions, it is a misfortune for the commission's status in particular and the Korean economy in general. The commission will reportedly come up with a final proposal after collecting opinions from all walks of life. We hope to see fair results.

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