KFTC Launches 'Food Collusion' Crackdown... Next Targets: Oil Refiners, School Uniforms, and Funeral Services

Sanctions Completed for Sugar and Pork
Measures on Flour and Starch Sugar Expected in First Half
Investigations Expanded to School Uniforms, Petroleum, and Funeral Services

The government is intensifying its crackdown on collusion to control the prices of key food staples directly affecting household budgets. The Korea Fair Trade Commission (KFTC), having recently completed regulatory actions on sugar and pork, now plans to ramp up pressure on the flour and starch sugar industries during the first half of the year. In addition, the KFTC will significantly expand its investigation scope to areas closely tied to daily life—such as school uniforms, petroleum, and funeral services—in an effort to root out unfair practices that threaten price stability.

Meeting Plaza Gas Station, Seocho-gu, Seoul. Photo by Jin-Hyung Kang.

On March 12, the KFTC will present a report titled "Sanctions Against Collusion on Essential Livelihood Items and Current Countermeasures" at the meeting of the "Special Task Force for the Management of Essential Livelihood Prices." The report aims to share the visible results of the crackdown on food price collusion since the TF was launched and to outline future investigation plans.

Pork Collusion Sanctions Finalized... Collusion Detected in Major Retail Networks

According to major cases reported that day, on March 11, the KFTC decided to impose corrective orders and a total fine of 3.165 billion won on nine meat processing companies that colluded to fix the price of pork supplied to Emart. The commission will also refer six of these companies to the prosecution.

Companies involved—including Dodram, Sunjin, and Farm Story—are accused of sharing minimum bidding prices for domestic pork (general meat) supplied to Emart or pre-arranging prices during the submission of branded pork quotations from July 2021 to October 2023. This marks the first case in which collusion among major suppliers was detected via a core distribution channel, namely, large supermarkets.

Previously, the KFTC had imposed a total fine of 408.3 billion won on three sugar refineries for colluding on sugar prices and quantities for about four years. This was the second-largest collusion-related fine in history, following the 2010 LPG collusion case (668.9 billion won).

Fines Worth Over 1 Trillion Won for Flour and Starch Sugar Collusion Imminent... Decision Expected in First Half

The KFTC plans to conclude its investigations into flour and starch sugar collusion, which are key ingredients in processed foods, within the first half of the year. In the case of flour, seven companies including CJ CheilJedang and Daehan Flour Mills have been investigated for dividing sales prices and quantities over approximately six years. Fines of up to 1.16 trillion won are under consideration. Similarly, the starch sugar collusion involving four companies, including Daesang, has been reviewed, with recommendations for both fines and criminal charges against executives and employees included in the review report.

During the investigations, the price of flour has already been voluntarily reduced by up to 7.9%, and starch sugar by up to 20.5%. These reductions have led to visible effects in stabilizing prices, as evidenced by price cuts in the bakery sector, including Paris Baguette and others.

The KFTC is expanding its investigation scope beyond food to encompass all aspects of daily life. Since February 25, the KFTC has been investigating collusion among four school uniform manufacturers and 38 dealerships nationwide. On March 9, it commenced an investigation into the four major oil refiners and high-priced gas stations nationwide for alleged collusion. Since March 3, the KFTC has also been conducting on-site investigations into rebate practices at major funeral homes across five regions nationwide.

The KFTC stated, "We will promptly conclude ongoing cases and respond strictly," adding, "We will continue to closely monitor major items such as instant noodles, snacks, bread, and ice cream to ensure that the effects of regulatory measures are felt across essential livelihood prices."

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