A court has suspended the effect of a data submission order that the Korea Fair Trade Commission (FTC) issued to Hanwha during an on-site investigation. This is the first time a court has suspended the FTC's order to submit data.
According to legal sources on Dec. 9, the Seoul High Court's Administrative Division 7 (Presiding Judge Kwon Soon-hyung) accepted Hanwha's request for an injunction. As a result, the effect of the FTC's order for Hanwha to submit the data will be suspended until Jan. 31 next year.
◇ Clash over viewing a mobile phone… legality to be decided in the main case
In July, the Korea Fair Trade Commission (FTC) conducted an on-site investigation to verify suspected intra-group transactions involving Hanwha Group's brand royalty fees. Hanwha argues that, in the process, FTC researchers did not properly follow the procedures set by law.
According to A's side, an FTC researcher directly operated the screen of A's mobile phone while checking text messages exchanged between A, a Hanwha employee, and an accountant. The phone was kept in the investigation room for about 30 hours, but no document was provided explaining the circumstances of custody and related procedures.
It is also reported that male researchers opened A's locker to check personal belongings in a public area and recorded the interview without prior consent. The attorney present on-site raised objections to the scope and method of the investigation. A later reported psychological distress and applied for a leave of absence.
Citing these procedural issues, Hanwha refused to submit A's text message records to the FTC. The FTC then issued a separate order requiring Hanwha to submit a USB containing screenshots of the relevant text messages.
◇ Court issues first suspension of FTC data submission order
This decision is the first time a court has suspended a data submission order issued by the FTC during an on-site investigation. The court found that enforcing the order as is could cause Hanwha irreparable harm.
Earlier, since June, the Korea Fair Trade Commission (FTC) launched an investigation into Hanwha Group and CJ Group over intra-group transactions involving trademark royalty fees. The purpose was to examine whether brand royalties were used as a means of unfair support among affiliates or private interest-taking by the owner family. The Hanwha Group affiliates under investigation reportedly included major units such as Hanwha, Hanwha Solutions, Hanwha Life Insurance, and Hanwha General Insurance, with Hanwha effectively serving as the holding company.
According to data submitted by People Power Party lawmaker Lee Yang-soo to the FTC on Nov. 18, last year's trademark royalty fees by corporate group were highest for SK at 349.9 billion won. LG was second at 349.0 billion won. Hanwha and CJ ranked third and fourth at 199.2 billion won and 133.1 billion won, respectively. POSCO was fifth at 128.2 billion won.
A Hanwha Group official said, "We respect the court's decision and will calmly engage in the main lawsuit going forward," adding, "We will also cooperate as faithfully as possible with the FTC's lawfully conducted investigation."