Fair Trade Commission to reintroduce conglomerate supervising bureau

Fair Trade Commission to reintroduce conglomerate supervising bureau. April. 23, 2013 06:17. peacechaos@donga.com.

The Investigation Bureau of the Fair Trade Commission is expected to be reintroduced with the name of "conglomerate supervising agency" after eight years of closure. The bureau had been called “the angel of death” in the business sector and was in exclusive charge of overseeing large companies.

A government source said Monday, "Discussion is under way within the Fair Trade Commission in creating an exclusive organization responsible for overseeing large companies, in order to support economic democratization measures including regulation of intra-group deals," adding, "62 conglomerates with total assets of over 5 trillion won (4.45 billion U.S. dollars) will be the major target." Commission chief Roh Dae-rae said at a recent parliamentary confirmation hearing, "The current organization and manpower have limits in responding to families of conglomerates` heads yielding personal interests."

The Investigation Bureau of the Fair Trade Commission was established in 1992 and had three departments dealing with unfair business practices including illegal internal deals. Back then, the bureau was largely feared by companies due to massive ex-officio investigation and penalties. The bureau, however, was abolished in 2005, as the focus of Fair Trade Commission shifted from regulation of large companies to consumer protection.

The "conglomerate supervising agency" will first probe into and punish illegal internal practices such as intra-group deals. The Fair Trade Commission is known to be selecting objects to recover profits that were obtained illegally after the fair trade law is revised.

The "conglomerate supervising agency" is also known to examine whether large companies abide by government regulations on corporate governance structure: regulation of circular shareholdings, separation of industrial and financial capital, and regulation of financial holding companies. The commission is examining ways to allocate 30-40 regular workers at the department in charge.

On the need to set up the "conglomerate supervising agency," agreement has been made to some degree within the government. There are conflicting opinions as to whether the number of employees at the commission should be increased. The commission claims that the total number of employees should be increased as workload has expanded along with the promotion of economic democratization policy, while the Presidential Office and the Security and Public Administration Ministry are known to be examining ways to reallocate existing manpower.

On setting up an exclusive bureau for large companies, the business sector is reacting against the move by saying, "This is regarding large companies as a whole as potential criminals, which will lead to setbacks."