[Asia Economy Reporter Woo Su-yeon] As the Fair Trade Commission imposed a record-breaking fine on Samsung Group for unfair support by funneling meal supply volumes to its affiliates, Samsung Group now faces another judicial risk. Currently undergoing trials related to group mergers and accounting suspicions, Samsung Group finds it difficult to accept the FTC's measures and has expressed willingness to pursue administrative litigation.
On the 24th, the Fair Trade Commission imposed corrective orders and fines totaling 234.927 billion KRW on Samsung Electronics, Samsung Display, Samsung Electro-Mechanics, Samsung SDI, and Samsung Welstory for violating the Fair Trade Act through unfair support. At the same time, former Samsung Future Strategy Office chief Choi Ji-sung, who led the unfair support, and Samsung Electronics were reported to the prosecution.
This fine is the largest ever related to unfair support. Previously, Samsung Group maintained that the meal supply contract with Samsung Welstory was a "normal transaction" and proposed a solution through consent decree, but the FTC did not accept this.
In the business community, there is concern that this case, which includes a huge fine and a prosecution report, could set a precedent for FTC sanctions against the business sector. Since group meal services have been a deeply entrenched internal transaction practice not only at Samsung but also at most large corporations, the FTC could impose sanctions as it directs its scrutiny.
Because of this, the business community also argues that there is a lack of fairness when comparing this Samsung case with other foreign companies' cases. In February, the Fair Trade Commission accepted a voluntary corrective plan and decided on a consent decree regarding Apple Korea's abuse of trading position.
On the other hand, despite Samsung including a 200 billion KRW fund for coexistence with small and medium-sized enterprises, it is pointed out that the consent decree was dismissed after just one review. A business official said, "Not only was the consent decree dismissed, but corrective orders, fines, and prosecution reports were also imposed, which seems to be an unfair measure," adding, "Samsung is now forced into legal battles over meal supply issues following the state corruption scandal and merger and accounting issues."
Meanwhile, in April, eight major conglomerates including Samsung Electronics, Hyundai Motor Group, and LG Group held a 'Group Meal Supply Opening Ceremony' event, expressing their intention to reform and correct the meal supply practices that have continued for over 30 years. Samsung Electronics also prepared coexistence measures such as gradually opening its in-house cafeterias and supporting smart factory systems to enable small and medium-sized meal suppliers to utilize them.
Regardless of the FTC sanctions, Samsung plans to gradually fully open about 50 in-house cafeterias including those of Samsung Electronics, Samsung Display, Samsung Electro-Mechanics, and Samsung SDI. Even with external opening, it is known that Samsung is considering prioritizing small and medium-sized businesses below a certain scale to prevent large affiliates from monopolizing contracts.
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