| Korea Fair Trade Commission (KFTC) Chairperson Joh Sung-wook reports to members of the National Assembly's National Policy Committee on the first day of the annual National Assembly audit, Tuesday. Yonhap |
Antitrust regulator chief vows to complete HHI-DSME, Korean Air-Asiana Airlines reviews this year
By Yi Whan-woo
Korea Fair Trade Commission (KFTC) Chairwoman Joh Sung-wook on Tuesday dismissed the possibility of toughening regulations on big tech companies as a corresponding measure against them abusing their market dominance as platform operators.
During this year's National Assembly audit on the country's top antitrust regulator, the KFTC chief explained that the government's antitrust regulations are based on the premise they do not hurt the market's innovativeness or dynamism.
“And in that regard, I don't think regulations will solve everything,” Joh said when asked if the KFTC was considering plans to enhance sanctions against big tech companies to the level that the United States does. “Countries can have differences over the method and level of the measures to be taken depending on their market situation. Given the role and significance of the big tech firms, it is too early to take strong measures as observed in the U.S.”
Many of the questions from the lawmakers were related to big tech companies pushing around customers or suppliers in their respective fields or behaving irresponsibly over complaints from consumers who purchase goods through the online platforms they provide.
Among the companies mentioned were Google for mobile operating systems (OS), Coupang for online shopping, Naver and Kakao for electronic banking, Amazon for direct delivery from overseas and Danggeun Market for used goods commerce.
Joh agreed with the lawmakers over the concerns on unfair business practices, saying, “Corresponding measures are of course needed for issues regarding platform and data businesses.”
She said the KFTC is therefore paying close attention to three types of unfair business practices happening on the platforms ― mistreatment of vendors by platform operators, mistreatment of customers by vendors and excessive competition among platform operators.
“The KFTC is working to revise and legislate laws over those three issues, with a goal of creating an environment for joint prosperity of all involved parties so that they can continue being innovative and dynamic.”
The cases of unfair business practices brought up by the lawmakers included Google preventing mobile smartphone makers from developing or using modified versions of Google's Android OS to squeeze out competition in the OS market.
The KFTC imposed a fine of 207.4 billion won ($174.6 million) on Google last month.
Coupang was accused of prioritizing its own products on its website in search results while pushing other companies' products to the bottom and making them receive less exposure.
Danggeun Market was accused of negligent handling of disputes between sellers and buyers over quality of used goods.
Amazon, which launched its international direct delivery service recently in partnership with domestic online shopping site 11Street, was found unprepared to handle overseas purchases of products banned in Korea.
HHI-DSME review to be completed by this year
Regarding the detailed timeline for reviewing Hyundai Heavy Industries' (HHI) proposed acquisition of Daewoo Shipbuilding & Marine Engineering (DSME) and Korean Air's acquisition of Asiana Airlines, the regulator chief said the KFTC plans to finish its review process for each case by the end of this year.
“Yes, we will get these two cases completed within this year,” she said.
HHI is awaiting approval from antitrust regulators in five countries plus the EU, as the merger will have a major impact on the shipbuilding industries there.
HHI submitted its takeover plan to the KFTC back in July 2018, but the commission only completed its first review as it is awaiting approval from the EU given the EU's significance in terms of market size. Out of the six HHI requested approval from, only China, Singapore and Kazakhstan have granted unconditional approval.
The planned takeover of Asiana Airlines by Korean Air requires approval of the United States, the United Kingdom and China where the two airliners operate their flight routes.