The Korea Federation of Printing Industry Cooperatives and small and medium-sized printing businesses across the country issued a joint statement on July 20, expressing deep regret over the Korea Fair Trade Commission's (KFTC) decision to grant large-scale exemptions and reductions in fines for major paper manufacturers involved in price-fixing, calling it "a pardon for repeat collusion."
According to the SME printing industry, the KFTC originally planned to impose a total of 338.3 billion won in fines, but the final amount was reduced to 144.1 billion won due to the application of the leniency program, which grants immunity or reductions for self-reporting.
Hansol Paper received a full exemption of its 142.5 billion won fine, and Murim affiliates also saw their fines reduced by 51.7 billion won, resulting in a total of 194.2 billion won in fines being waived.
In their statement, the industry said, "We express deep concern and strong regret over the KFTC's decision to exempt and reduce massive fines for major paper manufacturers' price-fixing activities," adding, "The government must immediately prepare concrete measures and institutional improvements to protect the small-scale printing industry from the collusive practices of large corporations that destroy the market ecosystem and to facilitate actual recovery from damages."
The industry argued, "This decision is tantamount to giving a pardon for the chronic and repetitive price-fixing practices of the paper manufacturing industry," and claimed, "The KFTC's recent measure undermines the original purpose of the system and has resulted in a sharp weakening of the deterrent effect against collusion in the market."
The SME printing industry claimed that paper manufacturers, which account for 95% of the domestic printing paper market, raised the sales price of printing paper by an average of 71% between February 2021 and December of last year, the period during which the collusion took place. As a result, printing companies were unable to reflect the price hikes in their supply unit prices, leading to financial difficulties such as deteriorating profitability, employment instability, and reduced facility investment.
The SME printing industry demanded that the KFTC transparently disclose the legal basis and deliberation process for the fine reduction decision, and that the government prepare measures for damage relief and competitiveness enhancement for small printing businesses and micro-enterprises affected by the collusion.
Furthermore, they urged the National Assembly and the KFTC to amend the Fair Trade Act to increase the effectiveness of the system, such as by restricting the application of leniency for habitual and repetitive collusion, and ordered large paper companies to participate in social dialogue to establish transparent trade order and promote mutual growth.
Park Jang-sun, Chairman of the Korea Federation of Printing Industry Cooperatives, said, "We will continue all legal and institutional responses until a fair market order is established and the damages caused by collusion are effectively recovered," adding, "We will stand in solidarity with small and medium-sized printing businesses across the country and respond strongly to the end to protect the right to survival of the 20,000 printing business owners and 68,000 employees nationwide."
(Photo: Provided by Korea Fair Trade Commission, Yonhap News)
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