Steel product manufacturers and sellers that colluded on prices were caught in large numbers. In response, the Fair Trade Commission imposed a penalty surcharge totaling 7 billion won on five companies.
On the 21st, the Fair Trade Commission ordered corrective measures and imposed a penalty surcharge of 6.549 billion won on five companies—Hankuk Steel Wire, Daea Steel, Cheongwoo Steel, Hanil Steel, and Jinhong Steel—on suspicion of violating the Monopoly Regulation and Fair Trade Act.
According to the Fair Trade Commission, the five companies colluded on the sales prices of four products, including galvanized steel wire, from December 2016 to February 2022. The products are round steel wires made through a zinc galvanizing process and are used as intermediate goods in various products such as fences, gabions, stapler pins, power cables, wire ropes, and automotive cables.
The five companies agreed not to compete on prices by jointly raising product prices when the raw material expense needed to manufacture galvanized steel wire and other items rose, and by maintaining existing prices when raw material expenses fell.
The agreement was reached through meetings among representatives or sales executives and employees. At these meetings, the companies decided the timing and magnitude of unit price increases for the four products, including galvanized steel wire. Each business implemented the agreement by sending unit price increase notices to counterparties or by giving verbal notice.
Through the collusion, the five companies raised the prices of galvanized steel wire and other items a total of 10 times by 50 to 200 won per kilogram. As a result, sales prices for the four products, including galvanized steel wire, increased by at least 42.5% and up to 63.4% compared with before the collusion.
The Fair Trade Commission said, "It is meaningful that we uncovered and sanctioned collusion in an intermediate-goods industry that rode on fluctuations in material expenses," adding, "This will serve as an opportunity to improve collusive practices in the market going forward and to create a fair competitive environment."