17 Companies Including Gas Corporation Fined 1.38 Billion KRW for Bid Rigging on 19.4 Billion KRW Distribution Panel Contract

[Asia Economy Reporter Moon Chae-seok] Seventeen distribution panel contractors, including Gyeongin Engineering, were caught by the Korea Fair Trade Commission (KFTC) for colluding in a bid for distribution panel purchases from Korea Gas Corporation worth 15 contracts totaling 19.4 billion KRW. Distribution panels are substation devices used to supply electricity stably; they convert high-voltage electricity supplied from Korea Electric Power Corporation into lower voltage and ratings suitable for equipment that monitors, controls, and protects the power system.

On the 15th, the KFTC announced that from April 2013 to July 2015, these contractors pre-determined the winning companies, acted as cover bidders to support them, and colluded on bid prices. The commission decided to impose corrective orders and fines totaling 1.387 billion KRW.

Among the 15 bid collusions, 11 contracts designated Wookyung Electech as the winning bidder, 3 contracts designated Gyeongin Engineering, and 1 contract designated Bestec. The cover bidders agreed to submit bids at levels that would not win and executed this agreement.

The designated winning bidders submitted bids at amounts that would secure the contract, while the cover bidders raised their bid amounts as agreed to ensure the designated bidders won. As a result, the designated bidders succeeded in winning 11 contracts.

The KFTC judged that the contractors conspired to collude after the Korea Gas Corporation changed its distribution panel purchase method from private contracts to competitive bidding starting in 2013 to replace aging distribution panels.

Park Ki-heung, head of the KFTC's Bid Collusion Investigation Division, said, "This action is significant in that it uncovered long-term secret collusion in public distribution panel purchase bids and recovered unfair profits gained through collusion," adding, "It is expected to contribute to deterring similar collusion in related fields in the future."

This content was produced with the assistance of AI translation services.