Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
FTC chief nominee vows to tighten grip on chaebol's internal trading
Fair Trade Commission chairwoman nominee Cho Sung-wook speaks during a press conference at the Korea Fair Trade Mediation Agency in Seoul, Tuesday. Yonhap
By Nam Hyun-woo
By Nam Hyun-woo
Fair Trade Commission (FTC) chairwoman nominee Cho Sung-wook is vowing to continue the antitrust agency's hardline stance on chaebol by rigorously deterring inter-subsidiary dealings within large business groups.
In a press conference, Tuesday, she also stressed the need for a systematic resolution of the abusive relations between large firms and their contractors, because the relationships form the foundation of the Korean economy and sway the life of the public.
“Chaebol have played many roles in Korea's economic growth so far, and what they look like these days is different from what they used to be in the 1990s when they incurred systemic risks for the Korean economy,” Cho said during a press conference at the Korea Fair Trade Mediation Agency in Seoul.
“However, improvements are still required for plenty of chaebol issues, such as the owner family controlling their corporate empire with a large stake and nurturing affiliates through unfair internal trades.”
Cho was nominated as the next chief of the FTC earlier this month, replacing Kim Sang-jo, who has built a strong reputation with his hardline approach on chaebol and now became presidential chief of staff for policy.
Businesses have been casting concerns over Cho, a Seoul National University professor, because she was a scholar less known to the public and she was assumed to share Kim's tough ideas on conglomerates, given her previous papers and contributions to international journals.
During the conference, she said the FTC under Kim has accomplished “meaningful outcomes” and the agency under her leadership will maintain the same aim.
Regarding her ideas on chaebol, she said “the FTC is a referee who should be fair in both star players and unknown ones,” but at the same time pointed out that “conglomerates' customary practice of unfairly funneling work to its units has been depriving SMEs of their chances to grow.”
“With the unfair internal trading, smaller firms with potential will be outperformed in the market, while large business groups will see costs rising because their counterparts will be limited to their affiliates,” Cho said. “This may lead to a decline in corporate performance.”
Over abusive relationships between large firms and their contractors, she admitted that the FTC cannot handle every case reported to the agency, thus it should employ a more systematical resolution, such as providing more information to contractors so they can avoid problems.
Cho also said the FTC will enhance its efforts to fight some companies' abuse of their monopolistic status in the market. She said the info-tech industry is prone to such practices, adding that the FTC will take a closer look at Google, Apple and Naver, which are already under the antitrust agency's scope.