FTC to fine SK Discovery over false sterilizer ads

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FTC to fine SK Discovery over false sterilizer ads

SK Discovery, the holding company of SK’s chemical and material businesses, will be fined 39 million won ($36,000) and may face further legal action over SK Chemical’s use of misleading advertisements during the 2011 humidifier sterilizer tragedy.

The Fair Trade Commission on Monday announced that, following a discussion on Feb. 28, it has decided to hold SK Discovery accountable for the false advertisements relating to SK Chemical’s humidifier sterilizer manufactured and sold between October 2002 and April 2013.

“We have come to the conclusion that SK Discovery, which actually inherited the former SK Chemical businesses, should take responsibility for illegalities committed by the former company,” the FTC said in a statement.

The antitrust agency last month reported former executives of SK Chemical and Aekyung Industrial to the prosecutors’ office and also levied fines against these companies as well as retailer Emart for false advertising related to humidifier sterilizers.

However, the initial penalty did not include SK Discovery, which was founded in December last year. It is currently the holding company in control of SK Chemical, SK Gas and SK D&D, a real estate and renewable energy developer.

The FTC claimed SK Discovery had been omitted largely because SK Group had not reported the governance change of SK Chemical.

The antitrust agency, which was criticized for not being thorough in its investigative process, said it has decided to create a manual that will reaffirm the status of companies that are being investigated at each level so that the mistake will not be repeated.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]
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