Fair Trade Commission Issues Corrective Order to Construction Equipment Council for 'Rent Collusion and Forced Shutdown'

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The Fair Trade Commission announced on the 15th that it has decided to impose corrective orders on the Gyeonggi-do branch of the Construction Machinery Individual Joint Business Operators Council, composed of excavator and other construction machinery rental operators, for determining rental prices and inducing member operators to comply with the recommended prices.

According to the Fair Trade Commission, the council decided on the rental prices of construction machinery at an executive meeting in February 2017 and implemented them from April 1, 2017. Based on the decisions made at the executive meeting, the council prepared a recommended rental price list and notified the member operators. It also induced compliance with the recommended prices by deciding to restrict dispatches to construction companies that traded at prices lower than the recommended prices.

At the executive meeting in June 2021, the council decided to increase the rental prices of excavators, dump trucks, and water trucks by 100,000 KRW compared to the prices decided in 2017, effective from January 1, 2022. They also produced flyers related to the rental prices and distributed them to each branch in Gyeonggi-do. Additionally, it was confirmed that the council held rallies to establish the rental prices and requested member operators to participate in work stoppages.

The Fair Trade Commission pointed out, "The act of a business association unilaterally setting construction machinery rental fees infringes on the autonomy of individual operators and restricts price competition."

Such acts fall under the prohibited acts of business associations (price determination, maintenance, or change) as stipulated in Article 51, Paragraph 1, Subparagraph 1 of the Monopoly Regulation and Fair Trade Act.

The Fair Trade Commission stated, "We will continue to monitor illegal acts by business associations that disrupt competitive order in the construction machinery rental market, such as determining rental prices, and will impose strict sanctions if similar acts are detected."

This content was produced with the assistance of AI translation services.