Board of Audit and Inspection: "Fair Trade Commission Incorrectly Entered Deadline for Imposing Fines"

Fair Trade Commission Audit Results Announced... "Supreme Court Rules Illegal Due to Expired Fine Imposition Deadline"

[Asia Economy Reporter Ryu Jeong-min] The Board of Audit and Inspection has released an audit report indicating issues in the Fair Trade Commission's management of fines, including incorrectly entering the deadline for imposing fines.

On the 30th, the Board of Audit and Inspection announced the results of its audit on the Fair Trade Commission. According to the Board, when the Fair Trade Commission receives a report of a violation of the Subcontracting Act, it registers the case in the case management system and begins an investigation.

If it is necessary to request dispute mediation from the Subcontracting Dispute Mediation Council, the Commission requests mediation, and if mediation fails, the case is registered in the case management system and an investigation is initiated.

According to Article 22, Paragraph 4 of the Subcontracting Act, corrective measures or fines cannot be imposed if three years have passed since the date of the report regarding a violation of the Subcontracting Act.

The Board of Audit and Inspection stated, "Among the 18 cases of violations of the Subcontracting Act where corrective orders and fines were imposed due to failed dispute mediation between January 25, 2016, and May 10, 2021, only one case correctly entered the starting date for the fine imposition deadline as the date the report was submitted."

The Board pointed out, "For the remaining 17 cases, the starting date for the fine imposition deadline was considered as the date of case registration in the case management system (10 cases) or the date the investigation began (5 cases). Additionally, in some cases (5 cases), the fine imposition deadline period was incorrectly entered as five years instead of three, resulting in an average delay of 359 days (up to 945 days) in the fine imposition deadline."

The Board explained, "In three cases, fines or other measures were imposed after three years had passed since the report was submitted," adding, "In case A, the Supreme Court ruled that imposing fines after three years from the report date is illegal as it exceeds the fine imposition deadline."

The Board of Audit and Inspection has requested the Chairman of the Fair Trade Commission to exercise caution regarding reports of violations related to the 'Act on the Fairness of Subcontract Transactions.'