The state-run antitrust watchdog said Thursday that it has fined local electronics rivals Samsung and LG for fixing the prices of key home appliances.
Samsung was fined 25.81 billion won ($22.28 million) and LG 18.83 billion won, according to the Fair Trade Commission.
As part of the regulator’s leniency program for first and second declarers, one of the companies will be exempt from the fines, while the other will get 50 percent cuts.
The FTC said its investigation started after a voluntary report by one of the companies, declining to specify their names.
Officials of the two electronics giants manipulated the prices of washing machines, flat panel TVs and laptop computers through several secret meetings and phone calls between 2008 and 2009.
They colluded to stop producing the lowest-priced models, to raise prices of the replacements and to lower sales incentives given to retail vendors.
The FTC explained that Samsung and LG may have feared slowing demand at a time when the global financial crisis had raised foreign exchange rates, prompting a surge in manufacturing costs.
In 2010, the two companies were also fined 20 billion won when they were found to have fixed prices of air conditioners and TVs provided to government offices.
“Their price-fixing raised product prices, affecting consumers directly. We will strengthen surveillance on the only rivals in the local market as they always have a possibility of collusion,” said Song Sang-min, an FTC official.
The two companies currently dominate the local electronics market, holding a combined share of more than 90 percent of washing machine and flat panel TV sales and 58 percent of laptop computer sales.
By Lee Ji-yoon (email@example.com)