LG U+ may face fines for disrupting probe

The Korea Communication Standards Commission (Kocsc) discussed penalties on Thursday against LG U+, the nation’s third-largest mobile carrier, for violating the Mobile Distribution Improvement Act and declining to disclose documents when the commission visited its offices.

The Kocsc could impose fines of up to 50 million won ($42,560) and other administrative restrictions on LG U+ by article 22 of the law if it proves intentional rejection or disruption of the investigation process. Since April, the commission has been investigating the nation’s three major telecommunications providers for violating the Mobile Distribution Improvement Act.

Under the law that took effect in October 2014, mobile carriers are banned from providing more than 330,000 won in subsidies per purchase of a new phone that is released at least 15 months earlier. However, the commission was investigating whether illegal subsidies, in the form of rebates, were offered to attract customers.

LG U+ was said to be providing the heftiest subsidies and selling phones on corporate discounts to general customers. The commission singled out the company for further investigation.

“On June 1, investigators from the commission visited the headquarters of LG U+ and asked for documents related to the fact-finding process,” said Park Noh-ik, director general of the consumer policy bureau at the commission. “However, the headquarters rejected the call and delayed their submission of documents for two days,”

LG U+ said it is supposed to be notified a week before any investigation and rejected the call, demanding the Kocsc give evidence on its findings.

However, the commission maintained that it is allowed by law to immediately conduct investigations in emergency situations without giving a concrete reason, as it may affect the integrity of the probe.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]