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| Hyundai Steel's steel mill in Dangjin, South Chungcheong Province, is seen in this file photo. Courtesy of Hyundai Steel |
By Park Jae-hyuk
The Fair Trade Commission (FTC) has started a procedure to levy at least 120 billion won ($100 million) combined in fines on Hyundai Steel, Dongkuk Steel, KISCO and nine other companies, according to officials Tuesday.
Six steelmakers and another six rolling mill operators are suspected of having colluded between 2012 and 2016 to fix prices during their bids to supply rebar to the central and regional governments, the antitrust agency said.
"We sent a report on our investigation to those companies on Dec. 9," a representative from the FTC's bid rigging investigation division said. "The companies are allowed to submit their written opinions in response to our report until March. After reviewing their opinions, our agency will hold a meeting of commissioners, although the date for the meeting has not been fixed yet."
The division is said to have written on its report that some of the companies should be referred to the prosecutors' office, in addition to being slapped with fines.
Data from the Public Procurement Service showed that the central and regional governments had purchased rebar collectively worth 4.15 trillion won between 2012 and 2016.
When Hyundai Steel, Dongkuk Steel, KISCO and three other steelmakers were found in 2018 to have colluded between May 2015 and December 2016 to limit the discount rates of rebar sold in the private sector, five of them were referred to prosecutors' office and all of them were slapped with fines equivalent to 3 percent of their sales during the period.
The total amount of fines in this latest case may therefore surpass 120 billion won.
Once the FTC finalizes the sanction, the companies may be excluded from bidding for public projects. They can also face lawsuits from the central and regional governments.
The steelmakers have remained cautious about this issue, saying that the investigation is under way.
"We are trying to ascertain the facts," a Hyundai Steel spokesperson said. "We will give explanations when the FTC convenes a meeting."
The nation's steelmakers have continued to face heavy fines for their alleged collusions over the past few years. In January 2021, the FTC levied a combined 300 billion won in fines on seven steelmakers for their alleged collusion between 2010 and 2018 to fix the prices of scrap steel. Four of them were referred to the prosecutors' office at that time.
Considering the fact that a cartel is generally unable to last without the leading player's involvement, criticism has been leveled particularly at Hyundai Steel, which has maintained the top spot in the domestic rebar market.
