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South Korea

BMW Korea hit with US$13 million in fines and three officials jailed over emissions fraud

  • Seoul Central District Court found that the German company had falsified emissions test results for some 29,000 cars that been imported since 2011
PUBLISHED : Thursday, 10 January, 2019, 11:06pm
UPDATED : Friday, 11 January, 2019, 5:11am

A South Korean court slapped the local subsidiary of car manufacturer BMW with 14.5 billion won (US$13 million) in fines on Thursday, after finding it guilty of falsifying emissions documents for thousands of vehicles.

Seoul Central District Court found that the German company had falsified emissions test results for some 29,000 cars that been imported since 2011, and separately sentenced three BMW Korea officials to between eight and 10 months in prison for their involvement in the fraud.

“BMW Korea was obsessed with maximising profits without paying attention to laws and regulations”, the court said in a statement.

“It hampered authorities’ efforts to improve [the] environment while damaging consumers’ confidence in itself.”

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BMW Korea is also facing a class-action lawsuit from dozens of consumers whose cars’ engines burst into flames last year.

The company was fined 11.2 billion won (US$10 million) in 2018 for failing to promptly recall car models that had been found to have faulty engines.

There were more than 40 cases of engine fires involving BMWs last year, according to domestic media. Some multi-storey car parks began refusing the company’s cars over fears they could catch fire.

More than 170,000 vehicles were eventually recalled in South Korea over a faulty exhaust gas recirculation cooler, which the carmaker blamed for the fires.

In August, BMW announced a recall for Europe and some Asian countries – including South Korea – of 480,000 cars affected by the same problem. Two months later, this recall was expanded to include more than a million diesel cars.

In South Korea, six out of 10 imported cars are from Germany. BMW sold nearly 39,000 cars in the first six months of this year alone, according to the Korea Automobile Importers and Distributors Association.

Following complaints from environmental authorities, South Korean prosecutors launched an investigation in 2016 into BMW Korea, Audi Volkswagen Korea, Mercedes-Benz Korea, Porsche Korea and Korea Nissan for allegedly falsifying emissions test results or other documents.

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Consequently, a local court in December hit Mercedes-Benz Korea with 2.8 billion won (US$2.5 million) in fines for cheating emissions tests.

Additional reporting by Agence France-Presse