The Korea Fair Trade Commission said on the 18th it will impose a 321 million won penalty surcharge and corrective orders on 27 school-uniform retailers based in Gwangju on suspicion of bid rigging.
According to a Korea Fair Trade Commission (FTC) investigation, the firms took part in 260 school-led school-uniform procurement bids from Nov. 1, 2020, to Feb. 21, 2023. In doing so, they designated a predetermined winner and decoy bidders for each tender and agreed on bid prices.
Under the school-led school-uniform procurement bidding system, each school selects as the successful bidder the retailer that offers the lowest price through bidding, and later receives deliveries according to the number of students who apply for uniforms.
To avoid lowest-price competition in the bids, the school-uniform retailers contacted one another to request decoy participation and cooperated, the investigation said. In 226 of the 260 bids, the winner was decided as they had agreed. The average contract amount was 4.6289653 billion won.
The Korea Fair Trade Commission (FTC) applied charges of violating Article 40, Paragraph 1, Item 8 of the Monopoly Regulation and Fair Trade Act, which bans bid rigging, to the 27 school-uniform retailers. The Korea Fair Trade Commission (FTC) said, "The collusion directly led to an unfair outcome of raising uniform purchase prices."