South Korea to Double Fines for Repeat Cartel Offenders

The Fair Trade Commission's announcement of a 'Repeat Cartel Eradication Plan' signals a much-needed crackdown on persistent anti-competitive practices that have plagued our markets for too long. For years, businesses have seemingly treated initial fines as a mere cost of doing business, with some even repeating offenses within short periods. This new approach, which doubles fines for repeat offenders and considers severe actions like executive dismissal and business suspension, reflects a stronger commitment to fair competition.

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In the past 10 years, if a business has been penalized for collusion, the fine will be increased by up to 100%.

The plan to reduce leniency for self-reporters and extend the look-back period for penalties to 10 years from the current five is particularly crucial. This ensures that past transgressions are not easily forgotten and that companies cannot simply cycle through periods of compliance before resuming illicit activities. The consideration of structural remedies, such as divestiture, and the potential for business suspension or license revocation for repeat offenders, demonstrates a serious intent to dismantle entrenched cartel behavior.

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We are considering measures such as ordering the dismissal of executives involved in leading collusion or imposing business suspension for repeated collusion.

While some may argue these measures are too harsh, the reality is that unchecked cartels distort markets, harm consumers, and stifle innovation. The proposed changes, including the potential for executive dismissal and business suspension, mirror practices in other advanced economies and are necessary to create a level playing field. The Hankyoreh, as a publication committed to economic justice and consumer protection, supports these stronger measures to ensure fair market practices and protect the public from the detrimental effects of repeated collusion.

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The reduction in leniency for self-reporting will be applied even for repeat collusion within 10 years, halving the discount.