FTC probes Ottogi, Kwang Dong for unfair internal trading

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FTC probes Ottogi, Kwang Dong for unfair internal trading

Published: 14 Sep. 2023, 18:16

PARK EUN-JEE
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FTC Chairman Han Ki-jeong speaks at a press briefing Thursday marking his first anniversary in the chairman post at a government complex in Sejong. [NEWS1]

The country’s antitrust regulator launched an investigation into major food company Ottogi and Kwangdong Dong Pharmaceutical, over allegations that they are involved in unfair internal trading among affiliates.

The Fair Trade Commission (FTC) dispatched on-site investigators on Thursday to the offices of the two companies and other mid-sized companies suspected of the same irregularity, seizing documents and other possible evidence.

The regulator declined to reveal further details since the investigation is underway.

The mid-sized companies including Ottogi and Kwang Dong are often subject to less strict scrutiny compared to large conglomerates, although owning family members tend to wield firm control over the board and other transaction decisions.

The probe could possibly spread to other companies of similar size.

FTC Chairman Han Ki-jeong vowed to curb the unfair practice in the mid-sized companies, categorized as a group with less than 5 trillion won ($3.8 billion) in assets.

“Mid-sized enterprises typically engage in businesses closely linked with the daily lives of the public, which include pharmaceuticals, clothing, food and beverages,” Han said during a press conference on Thursday.

“We will execute the punishment in accordance with the law against the companies tied with the unfair internal trading,” he said.

Transactions among affiliated companies were often caught by investigators given the deals bypass open biding and favor related companies.

BY PARK EUN-JEE [[email protected]]