Fair Trade Commission Approves Installment Payment of Fines for Three Sugar Firms in Price-Fixing Case... Up to Six Payments Over Two Years

Installment Payment Approved for CJ, Samyang, and Daehan Sugar: 396 Billion Won Fine
Financial Strain Acknowledged Based on Cash Holdings Criteria

The Korea Fair Trade Commission has approved the installment payment of record-breaking fines for three sugar companies accused of price-fixing over a prolonged period. These companies, which were initially required to pay over 100 billion won in cash at once, have now been granted up to two years to pay their fines in installments, easing their financial liquidity concerns.

A citizen selecting sugar at a large supermarket in downtown Seoul. Photo by Yonhap News.

According to the Fair Trade Commission on May 15, a recent plenary session approved requests from CJ CheilJedang, Samyang Corporation, and Daehan Sugar to extend the payment deadline and to pay their fines in installments. After being notified of the fines in March, these companies applied for installment payments, explaining that "the fines exceed 1% of the relevant sales revenue, and paying the full amount at once would cause significant financial difficulties." In principle, fines must be paid in full within 60 days of receiving the payment notice.

The reason the Fair Trade Commission approved installment payments was the "ratio of cash holdings to fines." Under relevant guidelines, to qualify for a payment extension or installments, the amount of cash holdings (excluding borrowings scheduled for repayment within two months) must be less than 50% of the imposed fine. A thorough review of the financial status of the three companies led to the conclusion that "given their cash holdings ratio, paying the fine in a lump sum would cause financial strain, so installment payments will be allowed."

According to the installment payment decision, CJ CheilJedang, fined 138.3 billion won, can pay in five installments. Samyang Corporation, fined 130.2 billion won, and Daehan Sugar, fined 127.3 billion won, can each pay in six installments. Thus, starting with the first installment due by May 15, the three sugar companies will make payments in installments through May 2028. The amount per installment is approximately 27.6 billion won for CJ CheilJedang, 21.7 billion won for Samyang Corporation, and 21.2 billion won for Daehan Sugar.

An official from the Fair Trade Commission explained, "At least one of three major quantitative criteria must be met for installment payments to be approved, but the standards are quite strict, so approval is not easy." The official added, "If the criteria are met, approval is granted mechanically."

This installment payment arrangement applies to the "sugar price-fixing" case announced by the Fair Trade Commission in February. At that time, the Commission imposed fines totaling 396 billion won (based on the final decision) on the three sugar companies for colluding to set the timing and extent of sugar price increases from 2021 to 2025, a period of about four years. This was the second-largest fine ever imposed for price-fixing.

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