The Korea Herald

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Lotte becomes No. 1 fair trade rule violator

By Korea Herald

Published : Sept. 7, 2015 - 18:34

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Retail giant Lotte Group has broken fair trade rules the most among the nation’s large conglomerates over the past 10 years, data showed Monday. 

Lotte Group chairman Shin Dong-bin (Yonhap) Lotte Group chairman Shin Dong-bin (Yonhap)

The Fair Trade Commission data showed that South Korea’s fifth-largest conglomerate was charged and fined a total of 147 times for breaching rules of the antitrust watchdog since 2005.

The number of Lotte’s unfair practices accounts for over 22 percent of the 649 cases brought against the country’s top five largest conglomerates during the period.

SK ranked second with 143 cases followed by Samsung, LG and Hyundai Motor, according to the report submitted to Rep. Shin Hak-yong of the main opposition New Politics Alliance for Democracy.

Shin said that corporations had crossed the line by violating rules over a dozen times a year.

“The Fair Trade Commission’s soft punishment of only giving out warnings has contributed to corporations’ loosened morals,” he said.

Lotte put itself under the spotlight after a recent succession feud between chairman Shin Dong-bin and his brother exposed its complicated governance structure and opaque management system.

NPAD Rep. Kim Ki-sik said on Monday that his party and the ruling party agreed to summon the Lotte chairman for the upcoming annual National Assembly audit sessions slated for Sept. 10- Oct. 8.

By the amount of fines, however, Samsung led the list with 684.5 billion won, more than 10 times that of Lotte at 67 billion won. Lotte has faced the least fines among the rule breakers.

The antitrust watchdog said 88 of Lotte’s violations were subjected to administrative warnings for minor violations.

Samsung also had the largest number of cases in which the FTC filed complaints with the prosecution. The group had 14 fair trade violations referred to the prosecution, closely followed by SK and Hyundai Motor at 13 and 12, respectively.

By Park Han-na (hnpark@heraldcorp.com)