Korea Fair Trade Commission to Enforce Mislabeling and Misleading Advertisement Law in Korea: May the Seller Beware

In June of 2011, the Korea Fair Trade Commission (KFTC) has begun to enforce Notification of the Standards on Imposing Penalties on Companies that Act on Fair Labeling and Advertising.  The KFTC is very aggressive in enforcing law.  We suspect to see a few public cases this year concerning mislabeled foreign products A penalty may be imposed only if:  The Act was violated on two or more occasions in a three year period; or Serious harm is realized by customers; or Seller engages in prohibited acts that are intentional or are a clear violation of law (typical vague catchall language). We have run into a few companies over the years that were exporting products from a particular country, but the country of origin of the product was actually a third country.  Check your labeling an insure that your labels reflect the proper quantity, quality, ingredients and country of origin.  __________ [email protected]

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Don’t Mess with the Big Boys in Korea: The Google Korea Saga Continues

In the past, raids have been conducted by the National Police Agency concerning alleged violations of Korea’s privacy law stemming from mapping software that is in direct competition with a product from the same parties that filed this present complaint. This time, the Korean Fair Trade Commission (FTC) raided Google headquarters in Seoul. The raid is intended to reveal information that Google is prohibiting or using tactics to delay the use of Korea’s Naver browsers and other browsers on the Android operating system. A complaint by the owners of Naver was filed to the FTC in April alleging, in short, that Google Korea has restricted the ability of smart phone manufacturers from pre-loading search engines onto the Android operating system. According to a Wall Street Journal article, a Google spokesperson is credited with noting that “Android is an open platform, and carriers and OEM partners are free to decide which

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Fair Transactions with Subcontractors Act of Korea: So Buyer Beware or Simply Avoid the Risk and Buy the Seller?

Because of perceived abuse by Korean conglomerates of subcontractors, the Korean Fair Transactions in Subcontracting Act was passed in March of 2011. The Act was effective since the beginning of July of 2011. The Act, in short, grants wide discretion to the Korea Federation of Small and Medium Businesses. This agency is now authorized to request adjustments to Korean subcontractors contractually obligated delivery prices and additionally may impose treble damages for certain violations of this Act, including for the act of misappropriation of the technology of subcontractors. The Act also reverses the burden of proof in many instances, while requiring conglomerates to make technical requests in writing and to conduct formal subcontractor practice surveys. The treble damages component of this Act is very rare in Korea. Punitive damages are only available in the most rare of cases and only if authorized by statute. The inclusion of treble damages in Korea

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Korean FTC Fines Korean Refiners for Collusion

In a possible reaction to Korea’s rising inflation, the Korea Fair Trade Commission (KFTC) fined the four major Korean refiners a total of KRW 434.8 billion (USD 442 million) for preventing competition through collusion. The KFTC noted that: “In their meeting in March of 2000, officials of the four refiners agreed to respect the rights of former exclusive oil suppliers to gas stations and refrained from supplying their products to even gas stations with ties with a particular brand in the past.” The KFTC claims that this alleged collusive act, led to consumers being forced to pay increased margins to suppliers even when prices of a barrel of the unrefined product decreases in the international markets. Korea government is attempting to do anything to reign in on inflation seemingly in every manner with the exception of raising interest rates and the suppliers of fuel, food products, autos and other top

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Korean Price-Fixing Law: Defining the Relevant Market in Korea Antitrust Law

The Seoul High Court (2009 NU 1930, May 19, 2010) has overruled a decision of the Korean Fair Trade Commission (KFTC) in a case concerning price-fixing by luxury car importers. The KFTC has appealed the this pivotal price-fixing case.  We shall update the reader. The High Court ruled that a price-fixing arrangement (restriction on discounts from MSRP) between Lexus car dealers was not an “unfair collective act” under Monopoly Regulation and Fair Trade Act Art. 19 (1) thus overruling the decision of the KFTC that imposed a fine and ordered the dealers not to engage in the price-fixing arrangement. The KFTC has also imposed a fine on other luxury car importers. The KFTC opined that the relevant market was the market for the particular car and not the entire car or luxury car market. Thus, the Commission ruled that the act restrained trade absolutely within the relevant particular car luxury

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Korean Antitrust Laws’ Evolution

Korea Times (07/30/2010)by Sean C. Hayes Over the past decade, Korea has fostered the development of a Fair Trade Commission (FTC) with the power to actively fight to eliminate anticompetitive forces in the market.  This admirable evolution is welcomed by most domestic consumers. However, in many cases, anticompetitive practices may actually be a benefit to consumers in the short and long term. In these cases, a more nuanced Chicago School approach is necessary in order to incorporate a little realism and reason to the discussion and not to jeopardize economics for the sake of cookie-cutter-like rules. An FTC ruling to fine the importers of BMW cars was recently upheld by the Seoul High Court. The seven importers were fined a combined 14 billion won. Their practices were traditional horizontal price-fixing arrangements. Many in the antitrust field would have expected the outcome after the uncovering of a price-fixing relationship between the

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