China’s retaliation to South Korea’s planned fines for alleged collusion to fix freight rates feared
- South Korea’s antitrust watchdog sent its review report last month to around 20 shipping companies from South Korea, China and Japan over alleged collusion to fix freight rates
- Beijing sent letters in May and July last year to the Korean government, expressing its concerns over the Korea Fair Trade Commission’s investigation
By Park Jae-hyuk
China has warned of potential retaliation against the Korea Fair Trade Commission’s attempt to fine shipping companies, including dozens of Chinese firms, for their alleged collusion to fix the freight rates for sea routes between the two countries over more than a decade.
According to industry officials, on Monday, South Korea’s antitrust watchdog sent its review report on March 25 to around 20 shipping companies from South Korea, China and Japan to tell them of its plan to fine them for simultaneously raising freight rates for the South Korea-China and South Korea-Japan routes.
The measure was taken about two months after the Korea Fair Trade Commission decided in January to fine 23 shipping companies, including 11 foreign firms, a combined 96.2 billion won (US$79 million) for 15 years of alleged collusion to fix the freight rates for sea routes between South Korea and Southeast Asia.
The watchdog plans to hold a meeting on April 27 to determine the amount of the fines for the shipping companies that sailed the South Korea-China route. The penalties on the shipping companies that sailed the South Korea-Japan route will be determined at its April 28 meeting.
If the [Korea Fair Trade Commission] fines shipping companies for fixing freight rates for the Korea-China route, the shipping agreement between the two countries will become virtually invalid
The Ministry of Oceans and Fisheries, which supervises the shipping industry, has maintained a negative stance on the Korea Fair Trade Commission’s sanctions, saying it is unreasonable and thoughtless to prohibit “collaborative actions” that are allowed by international law.