The Korea Fair Trade Commission said on the 30th it will begin sanction procedures against SK Chemicals, DS Dansuk, Aekyung Chemical, SK Ecoprime, Emac Solution, JC Chemical, and KG Eco Solution on suspicion of bid and volume rigging.
According to a Korea Fair Trade Commission (FTC) probe, the seven companies from Dec. 2013 to Feb. 2025 systematically rotated winners in bids for biofuel from refiners and power generators, while the companies not in the winning turn submitted cover bids. They also colluded on volumes in the process.
Refiners, under the Renewable Fuel Standard, are required to blend biodiesel into automotive diesel. Power generators, under the Renewable Portfolio Standard, must supply at least 15% of total generation with renewable energy and therefore use bio heavy oil. The seven companies exploited this to collude on bids and volumes for biodiesel and bio heavy oil for refiners and power generators. The amount awarded through their collusion over 11 years and 3 months totaled 9.7 trillion won.
The Korea Fair Trade Commission (FTC) believes the seven companies are suspected of violating Article 40, Paragraph 1, Items 3 and 8 of the Monopoly Regulation and Fair Trade Act, which prohibit bid rigging and volume collusion. It reached a tentative conclusion to impose a penalty surcharge and to refer the corporations and former and current executives and employees to prosecutors. For bid rigging, up to 20% of the related sales, including both the winning amount and the cover-bid amounts, can be imposed as a penalty surcharge. A penalty surcharge larger than 1.94 trillion won, which is 20% of the winning amount, could be imposed.
The Korea Fair Trade Commission (FTC) plans to finalize the penalty surcharge and the level of sanctions by holding a full commission meeting after hearing opinions from the seven companies.