Fair Trade Commission Announces 'Startup Acquisition and Merger Criteria' at OECD Meeting

Attended OECD Competition Committee Regular Meeting... Discussed Criminal Penalties for Cartels and Bid Rigging
Also Consulted on Establishing a Permanent System with Prosecutors in May Regarding Collusion Punishments
Handled Gas Gong Distribution Panel Purchase Bid Rigging and Jeju Air-Istar Air Merger Cases
Fair Trade Commission: "Presented Institutional and Law Enforcement Cases Rather Than Specific Cases at the Meeting"

[Image source=Yonhap News]

[Asia Economy Reporter Moon Chaeseok] The Korea Fair Trade Commission (KFTC) will attend the regular meeting of the Competition Committee of the Organisation for Economic Co-operation and Development (OECD) to discuss standards for startup acquisitions and corporate mergers, as well as criminal penalties for cartels and bid rigging. This comes amid efforts to establish a consultative system regarding collusion regulations with the prosecution. The KFTC explained that the meeting is a platform to present Korea’s systems and law enforcement cases rather than to mention specific cases.

The KFTC announced on the 8th that a delegation led by Standing Commissioner Kim Hyung-bae will attend the OECD Competition Committee regular meeting (online) for eight days until the 16th. They plan to discuss the latest competition law issues. The meeting is held twice a year. The topics include "Competition policy during the COVID-19 crisis," "Criminal penalties for cartel and bid rigging activities," and "Standards for startup acquisitions and corporate merger notifications."

The KFTC stated that it submitted a report introducing Korea’s systems and major law enforcement cases related to two topics: "Criminal penalties for cartel and bid rigging activities" and "Standards for startup acquisitions and corporate merger notifications."

The KFTC did not disclose which specific criminal penalty cases (cartel and bid rigging) and notification standards (startup acquisitions and corporate mergers) legal provisions will be announced at this meeting. A senior KFTC official said, "At this meeting, the presentation focused on systems and law enforcement cases implemented in Korea rather than specific cases, so the content is close to general theory."

On the 26th of last month, during a preliminary video conference, the KFTC introduced a case recognizing the defense of a "non-recoverable" company in the corporate merger process between Jeju Air and Eastar Jet. This was a case where the corporate merger review was expedited as the aviation market was suffering from management difficulties due to COVID-19.

A major collusion case handled in the first half of the year involved imposing corrective orders and a total fine of 1.387 billion KRW on 17 businesses that colluded in a bid for distribution panel purchases conducted by Korea Gas Corporation in April.

Regarding collusion regulations, it was reported that earlier this year, Shin Seong-sik, the 3rd Deputy Chief of the Anti-Corruption Department at the Seoul Central District Prosecutors’ Office, proposed a meeting to KFTC executives including Secretary-General Kim Jae-shin to establish a consultative system. This led to opinions, especially from the business community, that the intensity of investigations into violations of the Monopoly Regulation and Fair Trade Act (Fair Trade Act), such as corporate collusion, might increase.

A KFTC official said, "Through attending this OECD regular meeting, we will refer to expert presentations on global competition issues during crisis situations and overseas enforcement and policy trends shared by each delegation for our law enforcement activities and system improvements. Based on the discussion results, we plan to continue providing information on international competition law enforcement trends that domestic companies operating overseas should be aware of."

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