HiteJinro Hid 5 Family-Owned Affiliates for 9 Years... Fair Trade Commission Considers Prosecutor Referral

Head's Nephew and Cousin's Company Long-Term Omission
Significant Internal Transactions with HiteJinro
Key Issue: Intentional Omission... Possibility of Prosecution

Park Moon-duk, Chairman of HiteJinro. (Photo by HiteJinro)

[Asia Economy Reporter Moon Chaeseok] The Fair Trade Commission has launched an investigation into HiteJinro for concealing subsidiaries owned by the chairman's family for nine years. The FTC is reportedly considering referring Chairman Park Mundeok to the prosecution, viewing the case as highly intentional.

According to industry sources, the FTC recently conducted an on-site investigation of HiteJinro for violating the obligation to report and submit data on publicly disclosed business groups.

Under the Fair Trade Act, Chairman Park is required to report companies owned by relatives up to the sixth degree and in-laws up to the fourth degree to the FTC annually.

Following the FTC's indication, HiteJinro added five companies that had been omitted until now: Songjeong, Yeonam, Daewoo Combine, Daewoo Package, and Daewoo Chemical.

These companies are either 100% owned or have major shareholders who are Chairman Park's nephews or cousins.

These companies manufacture PET bottles, labels attached to bottles, and packaging materials.

They supply essential materials for producing HiteJinro beer and other products, and due to significant internal transactions, suspicions of preferential treatment have been raised.

The FTC is investigating on the grounds that HiteJinro deliberately failed to report these companies for nine years until last year's report, suggesting the existence of disguised subsidiaries.

If a company intentionally omits subsidiary reports to evade FTC oversight, the FTC can refer the chairman, Park, to the prosecution.

HiteJinro maintains that it was a simple mistake without intent.

They explain that these companies are independently managed by relatives without shares held by the same person or direct descendants, and they were unaware that these companies were subject to reporting.

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