Fair Trade Commission Decides Not to Prosecute SK Chairman Chey Tae-won for Omission of Submitted Materials

Choi Tae-won, Chairman of the Korea Chamber of Commerce and Industry, is delivering a welcome speech at the 1st Bank of Korea-KCCI Joint Seminar held on the theme of "Changes in the Economic Paradigm and Korea's Economic Response Measures" at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul, on the 1st. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Eunju Lee] SK Chairman Chey Tae-won received a 'warning' from the Fair Trade Commission (FTC) for failing to report some SK affiliates to the FTC. However, the FTC decided not to refer the case to the prosecution, judging that the likelihood of Chairman Chey’s awareness of the legal violation was low.

According to the FTC on the 9th, the commission decided not to prosecute but only to issue a warning regarding Chey Tae-won, the designated person of SK, for omitting four companies?Kin & Partners, Place4, Dorel, and The System Lab Architecture Office?when submitting materials for designation as a large business group. The FTC explained, “We considered the minor likelihood of Chey Tae-won’s awareness of the legal violation.”

The FTC regarded four companies, including Kin & Partners, which invested initial business funds in Hwacheon Daeyu Asset Management, the lead developer of the ‘Daejang-dong development project,’ as part of SK’s corporate group and judged that Chairman Chey had an obligation to submit the materials. The FTC stated, “Considering that from December 2014 to June 2021, Chey Ki-won, the younger brother and second-degree relative of Chairman Chey Tae-won, exercised dominant influence over the management of Kin & Partners, it meets the criteria for an SK affiliate.” The FTC designates large business groups with total assets exceeding 5 trillion won as of May 1 every year and collects designation materials from companies for this purpose.

However, the FTC judged that the likelihood of Chairman Chey’s awareness of the false submission of designation materials was minor according to the prosecution guidelines. This is because neither Chairman Chey nor SK’s existing affiliates held shares in the four companies, and there was no evidence that Chairman Chey was involved in the establishment or operation of the four companies. An FTC official said, “(To proceed with prosecution,) the designated person must be directly involved in the omission of material submission or at least have received reports on the related matters to consider the awareness ‘significant.’ However, there was no basis to view Chairman Chey’s awareness of the (material omission) as significant.”