The Fair Trade Commission said on the 27th that it issued a corrective order to EOSYSTEMS for blocking the supply of key parts to a rival in the defense industry.
According to the Fair Trade Commission's investigation, EOSYSTEMS asked Shinbo Co., which exclusively manufactures the "counter assembly," a key component of the panoramic sight, not to supply parts to rival Wookyung Optical. After this move, only EOSYSTEMS participated in the bid for K-9 self-propelled howitzer panoramic sights conducted by Hanwha Aerospace in 2022, and it was ultimately selected as the supplier.
The Fair Trade Commission determined that EOSYSTEMS had previously entered into a special clause with Shinbo stating that "if supplying, transferring, or outsourcing production of the counter assembly to a third party, obtain EOSYSTEMS' written consent," and used that clause as the basis to block parts supplies to competitors. The Fair Trade Commission viewed Shinbo as unable to provide parts to Wookyung Optical due to EOSYSTEMS' policy.
An official at the Fair Trade Commission said, "Even if the conduct was under the contract with Shinbo, restricting competition in the panoramic sight market falls under Article 45, Paragraph 1, Subparagraph 1 of the Monopoly Regulation and Fair Trade Act (inducing a refusal of transaction)." The Fair Trade Commission imposed a cease-and-desist order, a future conduct prohibition order, and a notification order on EOSYSTEMS.
It was confirmed that EOSYSTEMS maintained its policy of not supplying in response to Wookyung Optical's subsequent requests for counter assembly supply. The Fair Trade Commission pointed out that this effectively blocked the rival's business activities.
An official at the Fair Trade Commission noted, "We made clear that competition must be ensured even in the special structure where only designated defense contractors can produce products," adding, "We will continue to respond strictly to acts that restrict competition by monopolizing key parts by a specific company."