Trade Commission Initiates Investigation into Unfair Trade Practices for Patent Infringement of Cathode Materials in Secondary Batteries

[Asia Economy Reporter Jusangdon] The Trade Commission of the Ministry of Trade, Industry and Energy announced on the 19th that it will begin investigations into "unfair trade practices involving patent infringement of cathode materials," a key component of secondary batteries, and "anti-dumping of butyl glycol ether from Saudi Arabia."

The investigation into unfair trade practices related to cathode material patent infringement was initiated following a request by global cathode material manufacturers and sellers Umicore (Belgium) and Korea Umicore LLC (applicants) against overseas companies.

The applicants claim that the respondents produce cathode material products that infringe on their patents and supply them from overseas to Korea. According to the Unfair Trade Investigation Act, supplying goods that infringe intellectual property rights from overseas to Korea constitutes unfair trade practices.

Cathode materials, along with anode materials, separators, and electrolytes, are major components of secondary batteries. The related industry is rapidly growing due to the expansion of front-end industries such as electric vehicles. In particular, cathode materials determine battery capacity and lifespan, which greatly affect battery performance, and account for the largest proportion (40-50%) of raw material costs, making them a key material that determines the competitiveness of secondary batteries.

A Trade Commission official explained, "After reviewing the investigation request, we determined that the respondents met the requirements for investigation, including supplying cathode material products from overseas to Korea within two years of the application date, and thus decided to commence the unfair trade practice investigation."

The Trade Commission will conduct written investigations, on-site inspections, and technical briefings over approximately 6 to 10 months after the investigation begins to determine whether unfair trade practices occurred. If the respondents are found to have engaged in unfair trade practices, corrective measures such as export/import suspension orders, exclusion from entry, and imposition of fines may be applied.

Additionally, the Trade Commission decided to start an anti-dumping investigation on butyl glycol ether from Saudi Arabia on the same day. This follows a request filed on June 25 by domestic producer Lotte Chemical, claiming damage to the domestic industry caused by dumped imports of butyl glycol ether from Saudi Arabia and requesting an investigation necessary for imposing anti-dumping duties.

Lotte Chemical claims it has suffered damage such as decreased market share, lower sales prices, and reduced operating profit margins due to dumped imports from Saudi Arabia.

The Trade Commission plans to conduct preliminary and main investigations (each within five months) in accordance with the World Trade Organization (WTO) Anti-Dumping Agreement and domestic laws, and will make a final decision on whether to impose anti-dumping duties.