Fair Trade Commission Shortens Mandatory Prosecution Request Period to 4 Months

[Asia Economy Reporter Eunju Lee] The Korea Fair Trade Commission (KFTC) is shortening the mandatory prosecution request period to four months. This aims to reduce the burden on companies that arise when other government agencies request prosecution long after the KFTC's sanctions have been completed. The mandatory prosecution request system requires the KFTC to prosecute cases that it initially decided not to prosecute, upon request from the Ministry of SMEs and Startups (MSS) or the Public Procurement Service (PPS).

On the 2nd, the KFTC announced that it has revised the "Memorandum of Understanding on Prosecution Requests and Prosecutions for Violations of the Monopoly Regulation and Fair Trade Act" to rationally improve the mandatory prosecution request procedure. Through this revision, the period during which the MSS and PPS can request prosecution from the KFTC has been shortened from six months to four months. This change is interpreted as a response to the fact that there have been quite a few "belated" prosecution requests exceeding six months, which prolonged the prosecution request process. There were also criticisms that companies, which thought the matter was settled after KFTC sanctions, faced significant burdens due to delayed prosecution decisions.

The KFTC plans to alleviate the burden caused by the shortened prosecution request period by expanding data sharing and establishing a practical consultative body to strengthen inter-agency cooperation. To shorten the prosecution request period between the two agencies, the KFTC will provide the business operator's history of violations of the Fair Trade Act and other laws, the KFTC's investigation report evidence list, general status of affected companies, and bid contract dates together when notifying the case results (decision documents). Additionally, a practical consultative body will be established to resolve various issues arising during the prosecution request process.

The scope of case notifications to the MSS will also be adjusted. Notifications of unfair support acts and prohibition of private interest acts will be changed to be sent only upon MSS request. These cases are related to internal transactions within corporate groups and have low direct relevance to damages to small and medium enterprises, so the efficiency of case notifications is considered low. Previously, the memorandum mandated that unfair support acts and prohibition of private interest acts be compulsorily notified to the MSS.

The KFTC stated, "With this revision of the memorandum, decisions on whether to prosecute can be made more quickly, allowing the legal uncertainty of the relevant business operators to be resolved promptly, and the mandatory prosecution request procedure is expected to operate more efficiently."

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