Please tell me the procedure after a report to the Fair Trade Commission.

Hello. I am an attorney specializing in fair trade at Daeryun Law LLC.

Your matter appears to be a suspected price-fixing (unfair concerted act) case for which a report was filed with the Fair Trade Commission.

The act of adjusting prices by ‘agreeing’ with a competitor is a violation of the Monopoly Regulation and Fair Trade Act and is subject to severe sanctions.

The Monopoly Regulation and Fair Trade Act prohibits concerted acts that restrict competition, and one representative type of unfair concerted act is price-fixing.

If the act is detected, under the Monopoly Regulation and Fair Trade Act, it is punishable by imprisonment for up to 2 years or a fine not exceeding 150 million won.

It is highly likely that someone reported you or the other company to the Fair Trade Commission on suspicion of price-fixing.

Based on the facts of the reported case, the Fair Trade Commission decides whether to accept the case according to its internal review criteria.

There are also cases that are closed without launching a substantive investigation, but the rate of initiating investigations for collusion is relatively high.

When a formal investigation is initiated after a report to the Fair Trade Commission, the Commission may send you an official letter requesting the submission of materials or may conduct an on-site investigation in person.

Materials that can confirm the circumstances of a price agreement, such as emails, text messages, meeting minutes, and price-change records, are requested as a priority.

The investigator analyzes the relevant materials and, if necessary, hears statements from those involved and requests additional explanations.

Afterward, the case-handling department determines whether to place it on the agenda of the plenary session.

Where serious collusion suspicions are confirmed, it is placed on the plenary session's agenda, where matters such as a penalty surcharge, a corrective order, and whether to file an accusation with the prosecution are decided.

Afterward, the decision is notified to your company, and if you object, an objection or the filing of administrative litigation is possible.

As you described, where you consult with a competitor to align prices and then raise prices to the same level, it may be regarded as an act of price-fixing.

Raising prices after prior consultation with a competitor causes harm to consumers and undermines the order of free competition, so there is a strong likelihood of a legal violation.

In an investigation after a report to the Fair Trade Commission is received, the initial response determines the direction of the case.

Daeryun Law LLC provides tailored advice as follows.

▶ Analysis of communications with competitors and determination of whether collusion occurred

▶ Response to the Fair Trade Commission's requests for materials and attendance at statements

▶ Establishment of a strategy for reducing the penalty surcharge

▶ Response to the Fair Trade Commission's investigation procedures and representation in appeal procedures

▶ One-stop response extending to criminal defense in the event of a criminal accusation

If you have any questions, we recommend that you proceed with a consultation with a fair trade attorney.