Fair Trade Commission Sends Review Report on 'Price Collusion by Shipping Companies Including HMM'... Full-Scale Sanction Procedures Begin

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[Sejong=Asia Economy Reporter Joo Sang-don] The Korea Fair Trade Commission (KFTC) has determined that domestic shipping companies, including HMM (formerly Hyundai Merchant Marine), engaged in price-fixing and has begun formal sanction procedures.

According to industry sources on the 10th, the KFTC recently sent a review report containing the investigation results to major domestic shipping companies, including HMM. It is also known that companies such as Korea Shipping and Janggeum Shipping are included among the sanction targets.

Earlier, in July 2018, the timber import industry reported to the KFTC suspicions of collusion among domestic shipping companies, citing simultaneous increases in freight rates on Southeast Asia routes. In December of the same year, the KFTC conducted on-site investigations of HMM, Heung-A Shipping, Janggeum Shipping, and others. Through this, they secured evidence that collusion occurred not only on Southeast Asia routes but also on other routes, and expanded the investigation to include foreign shipping companies. Approximately three years after the timber import industry's report, the KFTC confirmed the allegations and sent the review report.

Until now, the shipping industry has maintained that their actions were legitimate joint activities. The Shipping Act stipulates that shipping companies may enter into contracts or joint activities regarding freight rates, vessel deployment, cargo loading, and other transportation conditions. Accordingly, the KFTC states that for joint activities by shipping companies to be considered legitimate under the Shipping Act, they must meet requirements such as ▲ prior written consultation with shipper organizations ▲ reporting the contents of joint activities to the Minister of Oceans and Fisheries ▲ not restricting withdrawal from joint activities. However, the KFTC believes that the joint activities of the shipping companies in this case did not meet these requirements.

After the shipping companies submit their opinions on the review report sent by the KFTC, the KFTC plans to make a final decision on the level of sanctions at a plenary meeting composed of nine members, including the Chairman of the Fair Trade Commission.

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