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Stiffer law to nearly triple number of companies subject to antitrust supervision

All News 10:27 August 01, 2018

SEOUL, Aug. 1 (Yonhap) -- The number of companies subject to regulatory supervision will nearly triple if the Fair Trade Commission's proposed stiffer guidelines on inter-affiliate trading are enforced, according to a corporate analysis Wednesday.

CEO Score, a website that appraises conglomerates, projected 623 firms will come under monitoring for illegal internal business transactions under the suggested new rule, up 175.7 percent from the current 226 companies.

The FTC said last month it will seek to revise the law on private contracts between affiliates, a wide practice in the corporate community in which companies do business with each other, funneling profits to owners of the business group while skirting fair competition. Listed firms in which the owner and his or her family own 30 percent or more of the stakes are placed under watch, but the proposed revision would change the bar to 20 percent. Subsidiaries that are more than half-owned by these companies would also be newly subject to monitoring.

CEO Score's analysis showed some major names would be included in the expanded supervision list if the revision takes effect, such as Hyundai Glovis, KCC Engineering & Construction, Samsung Life Insurance and Shinsegae.

In case of Jungheung Construction, 55 affiliates would go on the list. Hyosung Group will add 47 companies, while 32 more subsidiaries of GS and 31 of Hoban Construction will be put to antitrust inspections.

The country's top conglomerate Samsung Group will add six companies.

The Fair Trade Commission (Yonhap)


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