Asiana Responds to Fair Trade Commission's Fine: "Unacceptable... Will Take Action"

"Victory in LSG's Compensation Lawsuit... Will Respond Upon Receiving Resolution Document"

[Image source=Yonhap News]

[Asia Economy Reporter Yu Je-hoon] Asiana Airlines announced on the 27th that it finds it "difficult to accept" the Fair Trade Commission's decision to impose a fine on the company for unfair support of its affiliates and has announced its intention to respond in the future. Asiana Airlines stated in a press release that "it is difficult to accept that the fine and corporate indictment measures in the review report were adopted as is."

According to the Fair Trade Commission, Kumho Asiana Group proposed to several companies a plan to transfer Asiana Airlines' exclusive in-flight meal supply rights (for 30 years) on the condition of acquiring Kumho Express's (formerly Kumho Holdings) bonds with warrants (BW). In this process, Asiana Airlines transferred the exclusive in-flight meal business rights to Switzerland's Gate Group, and shortly after, Gate Group acquired 160 billion KRW worth of BW interest-free. The Fair Trade Commission pointed out that Kumho Express enjoyed a profit of about 16.2 billion KRW due to acquiring the interest-free BW at a rate lower than the normal interest rate.

Additionally, the Fair Trade Commission raised concerns that affiliates of Kumho Asiana Group, including Asiana Airlines, lent funds to Kumho Express at low interest rates.

Regarding this, Asiana Airlines rebutted, stating, "The contract with Gate Gourmet Korea (GGK), which has excellent in-flight meal manufacturing capabilities, was signed following the termination of the existing contract with LSG Sky Chefs Korea. This was a normal business judgment considering the trust damage that occurred during the 15-year contract period and the future improvement of in-flight meal quality."

Asiana Airlines further emphasized, "The Seoul Southern District Prosecutors' Office dismissed the charges of breach of trust related to in-flight meals filed by a civic group, and in the damages lawsuit filed by LSG, the Seoul Central District Court ruled entirely in favor of Asiana Airlines."

Asiana Airlines stated, "In the Fair Trade Commission's plenary session last July, we also explained that the transaction conditions with GGK were more favorable compared to those of LSG," and added, "Once we receive the formal decision document from the Fair Trade Commission, we will carefully review the contents and respond accordingly."

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