The government plans to strengthen crackdowns on large corporations,.. namely the so-called chaebols,... over unfair trade practices that hurt smaller businesses.
It has drafted a bill proposing a full reform of the country's fair trade law,... the first such attempt in 38 years.
Oh Soo-young has more.
The government is planning to get tougher on big companies that engage in unfair business practices and tighten the rules on inside deals between their affiliates.
The Fair Trade Commission said Sunday that it's drafted a total revision of the Fair Trade Act,... as part of its efforts to create a virtuous cycle of prosperity for companies big and small.
In the proposal, the anti-trust watchdog suggests strengthening enforcement and penalties on those who violate the act.
It would do that largely by giving up its exclusive right to file complaints with the prosecution about unfair pricing and collusion, enabling other government agencies to initiate investigations too.
Also, penalties for violating the Fair Trade Act would be doubled.
Companies found guilty of collusion would have to pay up to 20 percent of their sales income, an increase from the current 10 percent,... and those caught engaging in unfair trade would be hit with four percent.
In a bid to break up the dominance of large companies, the government plans to tighten the limit on the stake a corporate leader can hold in the smaller companies they deal with.
They're now limited to 30 percent, but that would be brought down to 20.
The FTC suggested the twenty-percent cap would be applicable to some 600 companies,... more than double the current 231.
At the same time,... regulations on big companies investing in or forging M&As with smaller firms will be eased to promote synergy and innovation.
The government plans to submit the bill to parliament for approval in November.
Oh Soo-young, Arirang News.