Prosecutors Summon Kim Myung-su, Samsung C&T President, for Investigation into Wellstory Preferential Contract Allegations

[Image source=Yonhap News]

[Asia Economy Reporter Heo Kyung-jun] The prosecution investigating allegations of Samsung Group’s “preferential allocation of catering contracts to affiliated companies” summoned and questioned Kim Myung-soo, President of Samsung C&T Corporation.

According to the legal community on the 2nd, the Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Lee Jung-seop) summoned Kim, who was formerly part of Samsung’s Future Strategy Office (FSO), as a witness and is currently investigating him.

In March, the prosecution conducted raids on the headquarters of Samsung Electronics and the finance and accounting departments of Samsung Welstory in connection with the group-wide “preferential allocation of catering contracts” allegations. The investigation team has been analyzing the seized materials and selecting necessary documents.

Earlier, in June last year, the Korea Fair Trade Commission (KFTC) imposed a total fine of approximately 234.9 billion KRW on Samsung Electronics, Samsung Display, Samsung Electro-Mechanics, and Samsung SDI for unfairly supporting Samsung Welstory by funneling affiliated companies’ catering volumes. The KFTC also filed a complaint with the prosecution against former Samsung Group Future Strategy Office head Choi Ji-sung and Samsung Electronics for violating the Fair Trade Act.

The KFTC’s investigation found that from April 2013 to June 2021, four affiliates including Samsung Electronics allocated 100% of their in-house catering volumes to Welstory through non-competitive contracts. During this period, Kim served as the head of Strategy Team 2 in Samsung Electronics’ Future Strategy Office.

The prosecution suspects that Samsung Electronics and other affiliates funneled in-house catering volumes to Welstory through non-competitive contracts and set favorable conditions to provide excessive profits.

Last month, the prosecution also summoned Choi Yoon-ho, President of Samsung SDI, as a witness for questioning. Choi is suspected of having been the person who caused the cancellation of competitive bidding for four cafeterias within Samsung Electronics in 2014, while serving as Executive Director of Strategy Team 1 at Samsung Group’s Future Strategy Office, in order to preserve Samsung Welstory’s catering volumes, according to the KFTC investigation.

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