KG Chemical and Others Collude on 7 Billion Won Waterworks Wastewater Treatment Agents... Fine of 240 Million Won

Collusion in Public Bidding for Weapon Agglomerants... Correction Order and Fine of 242 Million Won

[Asia Economy Reporter Moon Chaeseok] KG Chemical and Kosoltec were caught by the Korea Fair Trade Commission (KFTC) for colluding in a bid to purchase raw materials for water purification worth approximately 7 billion KRW (29 cases) from Korea Water Resources Corporation and others. The KFTC decided to impose corrective orders and a total fine of 242 million KRW.

The KFTC announced on the 4th that the two companies colluded on the expected winning bidder, accomplices, and bid prices during the bidding process for inorganic coagulant purchases, leading to this action.

Inorganic coagulants mainly refer to coagulants used to purify wastewater at industrial water treatment plants and sewage treatment plants. Among the 29 detected collusion cases, KG Chemical agreed in advance to win 27 cases, and Kosoltec agreed to win 2 cases, and they executed these agreements.

According to the KFTC, KG Chemical brought Kosoltec into the bidding in early 2014, citing a lack of participants in the inorganic coagulant bidding.

At least two or more businesses are required to conduct a two-stage competitive bidding in the Multiple Award Schedule (MAS) for general inorganic coagulant products.

Subsequently, KG Chemical and Kosoltec agreed on the expected winning bidder to win the product.

Source=Korea Fair Trade Commission

The KFTC judged that such actions violated Article 19 of the Monopoly Regulation and Fair Trade Act (Fair Trade Act) and announced that it would impose corrective orders and fines totaling 242 million KRW on the two companies.

They decided to impose 157 million KRW on KG Chemical and 85 million KRW on Kosoltec, respectively.

Park Kiheung, head of the bid collusion investigation division at the KFTC, said, "It is significant that we detected and sanctioned the long-term secret collusion between the two companies in the public purchase bidding for inorganic coagulants conducted by Korea Water Resources Corporation and others."

He added, "The KFTC plans to further strengthen monitoring of collusion in industries related to public life and safety, such as drinking water supply and sewage treatment."