FTC chief vows more conglomerate scrutiny

Home > Business > Economy

print dictionary print

FTC chief vows more conglomerate scrutiny

This year, Korean conglomerates will be the target of fair trade watchdog investigations of any bullying activities involving pressure on small suppliers.

In particular, the Korea Fair Trade Commission (FTC) said it will monitor manufacturers that rely on importing raw materials and parts.

“The FTC’s main focus will be on Korea’s stronghold industries like automobiles and electronics, in particular their imports of key parts and materials,” said FTC Chairman Jeong Jae-chan on Friday at a breakfast meeting with chaebol executives.

Nearly 100 people, including CEOs and executives from major builders, automakers and electronics companies, as well as local business lobby leaders and attorneys from large law firms, attended the session to get a sneak peek of the watchdog’s policy vision.

Jeong became the first FTC chairman under the Park Geun-hye government to hold a roundtable meeting with chaebol executives.

Jeong went on to explain that the Korean FTC will work with counterparts in the United States and European Union to jointly oversee any manipulations of international prices and cartel activities. He said he hopes to extend the agency’s system of cooperation with our counterparts, including official prosecution, to help curb such collusion.

The FTC also will strengthen investigations of global IT companies to stop any unfair trade activities and raise patent fees on local IT industry.

Jeong said the FTC is scheduled to establish a special investigation team in February that only deals with ICT patents, because some global ICT patent giants - which the global fair trade watchdogs call “patent trolls” - like Nokia and Ericsson so far have charged excessive patent license fees on local electronics companies like Samsung Electronics and LG. Another focus will be on assessing merger cases among global IT giants, which is another method to raise patent fees.

Within local industry, the FTC will implement a bottom-up type investigation system, in which the FTC begins investigations by looking at financial records of suppliers to see if conglomerates are paying what they promised. This also will help the FTC identify cases in which big companies reduce the amount of profit to those suppliers when their sales performance is low.

The FTC also will launch a whistleblower protection system this year in which suppliers can anonymously report unfair business activities, while strengthening investigations on retail conglomerates that lure franchise shop holders with exaggerated claims.

“Fair trade culture can’t be established with the FTC executing laws. Large companies should voluntarily enhance current trade customs to be more transparent,” said Jeong. “But at the same time, I don’t want to interfere too much with business activities while overall economy hasn’t fully recovered. I hope Korean companies compete fairly with their technology and business power, instead of using foul play.”


BY KIM JI-YOON [jiyoon.kim@joongang.co.kr]

More in Economy

Gangbuk beats Gangnam

600,000 jobs added last year, but many public or welfare

Consumer price gains pick up speed in November

Life expectancy up 7 months for Koreans born in 2019

OECD knocks tenth of a point off Korea's 2020 growth

Log in to Twitter or Facebook account to connect
with the Korea JoongAng Daily
help-image Social comment?
lock icon

To write comments, please log in to one of the accounts.

Standards Board Policy (0/250자)

What’s Popular Now