Korea’s corporate watchdog chief said on June 14 that a revision to the country’s fair trade law will be proposed to the National Assembly in September.
Earlier, the Fair Trade Commission said it would review 17 key issues, such as competition, and iron out a revision draft by July.
The current fair trade law, enacted in 1980, has been under fire for failing to reflect the latest industry trends and better protect consumer rights.
Kim Sang-jo, the corporate watchdog chief, stressed that the FTC would get tough on unfair business practices by the country’s family-controlled business groups.
Korean fair trade law forbids inside deals aimed at giving unfair support to affiliates under the wing of a conglomerate. Family-run business groups have used such intra-company deals to help companies run by owner family members win lucrative contracts and earn huge sums of money.
“Such business deals have been used to help managerial transfers, and hurt smaller businesses, and I think such practices should be rooted out,” Kim said.
The FTC said earlier it would seek to revise the law forbidding inter-affiliate trading within a business group whose owner and family hold 30 percent or more of listed affiliates by lowering the threshold to 20 percent. For unlisted subsidiaries, the limit is 20 percent.
Also, the corporate watchdog said earlier that the revised enforcement ordinance of antitrust laws will restrict deals that favor companies owned by the founding family members of large businesses.
By Song Seung-hyun and newswires (email@example.com