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Three chaebol fined for violating disclosure rules
Publication Date : 05-09-2013
The Fair Trade Commission on Wednesday imposed fines of 665 million won (US$578,000) in total on three conglomerates for breaching the disclosure rules on intra-group deals.
Between April 2010 and March 2013, 17 out of the 38 business units of Lotte, Posco and Hyundai Heavy Industries engaged in the irregular intra-group trading, said the antitrust regulator.
The FTC revealed 25 violations by the 17 companies. As the cases involve “not publicising” or “delaying disclosure”, allegations could be raised that they had intentionally sought to make behind-the-scenes deals.
Lotte Group topped the list with 11 violations, followed by Hyundai Heavy Industries Group with eight and Posco Group with six.
Meanwhile, Posco posted the highest rule-breach ratio (compared to their total intra-group deals) of 5.4 per cent, followed by Hyundai Heavy with 3.1 per cent and Lotte with 1.8 per cent.
Among the 17 units were Lotte Hotel, Lotte Food, Lotte Boulangerie, Posco, POS Himetal, SC-PRT, Hyundai Hotel, Hyundai Avancis and Mipo Engineering.
“As for cases, Lotte Hotel and Posco failed to publicise property transactions and stock trading, respectively,” said an FTC official.
Six Lotte affiliates were slapped with regulatory fines of about 447 million won, five Posco affiliates with 146 million won and six Hyundai Heavy affiliates with 71 million won.
In a policy attempt to crack down on irregular trading among conglomerate-based units, the FTC carried out a full-fledged investigation into the three groups between last June and July by dispatching a group of inspectors.