B&T "Interflex Loses Administrative Lawsuit for Violating Subcontracting Act"

[Asia Economy Reporter Hyungsoo Park] Flexible Printed Circuit Board (FPCB) company BNT announced on the 22nd that Interflex lost the administrative lawsuit against the Fair Trade Commission regarding the Subcontracting Act. This is the result of the appeal trial concerning the corrective order and a fine of 350 million KRW imposed on Interflex in 2020.

According to the Fair Trade Commission, "Interflex entrusted some processes of printed circuit boards for smartphones to the subcontractor BNT and required the installation of equipment capable of producing a certain quantity each month within Interflex's factory," adding, "Starting from January 2017, they agreed on a guaranteed quantity for a two-year contract period and finalized the unit price."

Accordingly, BNT established mass production facilities and began mass production in June 2017. In January 2018, Interflex's client, global smartphone company A, stopped placing orders, leading Interflex to cease transactions with BNT.

BNT stated, "Shifting the responsibility for the order suspension by the ordering party onto the subcontractor violates the Subcontracting Act and constitutes an abusive practice," emphasizing, "The resulting losses to the company are enormous."

The Fair Trade Commission viewed Interflex's actions as an unfair cancellation of consignment prohibited under Article 8, Paragraph 1 of the Subcontracting Act and decided in August 2020 to issue a corrective order and impose a fine. Interflex appealed, claiming that the production halt request was due to market fluctuations of the client and that the subcontractor BNT did not comply with the contract.

The Seoul High Court ruled on the appeal, stating, "The plaintiff (Interflex)'s claim is without merit and is dismissed," and ordered, "The litigation costs for the defendant and the auxiliary participant shall be borne by the plaintiff."

A BNT official emphasized, "The appeal trial result is expected to affect the ongoing civil lawsuit," and added, "We will hold Interflex accountable."

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