Mirae Asset maintains innocence despite court ruling

Mirae Asset Financial Group's headquarters in Seoul / Yonhap

By Lee Min-hyung

Mirae Asset Financial Group maintains it is innocent after a recent Seoul court ruling that the financial conglomerate violated a local fair trade act by reaping undue profits while managing a golf course and luxury hotel.

The years-long legal tussle between Mirae Asset and the Fair Trade Commission (FTC) is centered on whether the financial group engaged in any unfair acts in operating Blue Mountain CC and Four Seasons Hotel Seoul. The two luxury facilities are managed by Mirae Asset Consulting ― the group's sole non-financial affiliate.

The FTC claimed that Mirae Asset has violated the fair trade act, as its key affiliates “unfairly supported” businesses of the two facilities and helped their sales growth.

The financial group, however, said the company has had no choice but to take such actions due to a regulation that separates the industrial and financial capital. Blue Mountain CC is a golf course that Mirae Asset's key financial affiliates such as Mirae Asset Global Investments and Mirae Asset Securities invested in by establishing a joint real estate fund. But the regulation prevented them from managing the facility, so the group's non-financial subsidiary started operating the golf course.

The FTC imposed a fine of 4.3 billion won on Mirae Asset in September 2020, citing a violation of the Fair Trade Act. In response, the financial firm filed administrative litigation against the watchdog, but the FTC won the second trial in the lawsuit.

Mirae Asset expressed regret over the latest ruling, saying that it is a rational decision for Mirae Asset's affiliates to use the two facilities after making investments there.

“Mirae Asset sought to find companies to manage the two facilities, but failed to do so due to their unstable profitability,” a spokesman at the company said. “Golf course and hotel businesses come with huge fixed costs and require consistent investment to maintain their luxury identity.”

Mirae Asset also said the two facilities resulted in losses, not profit, for the consulting affiliate. Mirae Asset Consulting ended up bearing a combined loss of 55.4 billion won while operating the golf course and hotel between 2015 and 2017.