FTC chief to meet 4 biggest chaebol this week
[THE INVESTOR] The new head of South Korea’s antitrust watchdog said on June 19 he would meet top officials of the nation’s four largest business groups this week to communicate with them over the Moon Jae-in government’s drive for chaebol reform.
Kim Sang-jo was appointed as FTC chairman by President Moon Jae-in last week, despite strong objection from conservative opposition parties. When named as the nominee for FTC chief a month ago, he had vowed to enhance monitoring of the four largest conglomerates here -- Samsung, Hyundai Motor, SK and LG.
“I will first seek to meet the four largest groups as soon as possible, within this week,” Kim said at a press conference in the government administrative city of Sejong.
“By explaining the president’s campaign pledges and enhancing policy predictability, I will start dialogue between the government and the business community.”
Kim said he had conveyed his intention to the Korea Chamber of Commerce and Industry to meet either the chairmen or CEOs of the four groups.
Dubbed “chaebol sniper” by the local media for his longtime shareholder activism, Kim has described chaebol as “the Korean economy’s cherished assets.”
Rather than the FTC strictly regulating chaebol, Kim said he hopes conglomerates will voluntarily seek changes according to the demands of society and the market.
Kim noted that the FTC has been closely monitoring 45 of the biggest conglomerates with more than 5 trillion won ($4.4 billion) in assets and 225 of their affiliates on whether there has been any wrongdoing in their internal transactions since March.
“Regardless of the size of the company, the FTC will strictly deal with any legal violations during our analysis,” Kim said.
As for his previous remarks on enhancing monitoring of the four-largest conglomerates, he said “there was no measure prepared in detail yet.”
The FTC is also investigating the 45 conglomerates on whether any of them are coercing unfair deals with subcontractors and small and medium-sized enterprises.
He also said his plan to expand the FTC’s current business group division into a business group bureau to better monitor such unfair deals is expected to be completed in late July, as the plan needs policy coordination with the Interior Ministry and the Finance Ministry.
The former director of Solidarity for Economic Reform, a civic group, said the FTC would not directly intervene with the market, unless there is any price collusion or abuse of a company’s dominant market power.
Local fried chicken franchise BBQ recently decided to withdraw its plan to raise its chicken price, after the FTC announced that it would investigate the company to see if it was abusing its power to shift the burden of marketing to franchise shop operators.
"The FTC does not manage prices. It does not have the authority to intervene in the market price, unless there is (power) abuse or (price) collusion.”
By Kim Yoon-mi/The Korea Herald (email@example.com)