It was confirmed on the 31st that the Korea Fair Trade Commission had launched on-site inspections into five companies, including LG H&H, that use vinyl and plastic packaging. The probe is reportedly intended to examine whether they passed on increased packaging manufacturing expense to subcontractors amid continued instability in materials and supplies procurement due to the Middle East war.
On the day, Chairperson Ju Biung-ghi of the Korea Fair Trade Commission said at a Cabinet meeting, "Today we launched on-site inspections into whether five food, cosmetics, and detergent companies that place large orders for vinyl and plastic packaging violated the subcontract price indexation system." The five companies Ju mentioned are LG H&H, Aekyung Industrial Co., Amorepacific, Nongshim, and Lotte Wellfood.
Under the Fair Transactions in Subcontracting Act, when the price of key materials and supplies fluctuates, the prime contractor and the subcontractor must adjust the subcontract price as previously agreed. The Korea Fair Trade Commission (FTC) is said to be focusing on whether the surge in packaging raw material prices was not reflected in supply prices, thereby pressuring the subcontractors of the five businesses.
The previous day, the Korea Fair Trade Commission (FTC) also began on-site inspections at the headquarters of five paint companies—KCC, Noroo Paint, Samhwa Paint Industrial, Kangnam Jevisco, and Chokwang Paint—over suspicions that they colluded on prices by riding on the war. Those surveyed reportedly included the office of the industry interest group Korea Paint and Printing Ink Industry Cooperative.