Fair Trade Commission Files Criminal Charges Against Four Asphalt Concrete Bidding Cartel Associations

[Sejong=Asia Economy Reporter Kwon Haeyoung] Four cooperatives, including the Daejeon Sejong Chungnam Asphalt Concrete Industrial Cooperative (Main Cooperative), were caught by the Fair Trade Commission for colluding in the bidding process to select asphalt concrete (Ascon) suppliers.

The Fair Trade Commission announced on the 22nd that it will file charges with the prosecution against the Main Cooperative and its three subordinate business cooperatives (Dongbu Cooperative, Bukbu Cooperative, Seobu Cooperative) for agreeing in advance on bid quantities and prices and executing them during the annual unit price contract bidding for Ascon in the Daejeon, Sejong, and Chungnam regions conducted by the Daejeon Regional Public Procurement Service from 2017 to 2018. The Fair Trade Commission imposed corrective orders and a total fine of 4.274 billion KRW on these cooperatives.

At that time, the bidding announcement stipulated that a single cooperative could not win more than 50% of the total announced quantity, and the combined quantity won by two or more cooperatives could not exceed 80% of the total. Although the three business cooperatives each had the capacity to produce more than half of the total quantity, they adjusted their bid quantities so that all cooperatives could win bids. They also set bid amounts so that the winning bid price ratio was close to 100% of the estimated price. As a result, the three business cooperatives won the bids as agreed.

These cooperatives allocated the won quantities to their member cooperatives and received certain fees. The investigation found that the collusion aimed to prevent profitability deterioration caused by low-price bidding competition and to distribute quantities stably to their members.

A Fair Trade Commission official stated, "Although the Main Cooperative did not participate directly in the bidding, it played a leading role by providing the venue for agreements with the three cooperatives and in the process of agreeing on bid quantities and prices."

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