The South Korean government and the ruling Democratic Party have decided to scrap the Fair Trade Commission (FTC)’s exclusive right to file complaints against criminal collusion, allowing prosecutors to initiate investigations without the antitrust watchdog’s intervention.

The ruling party announced Tuesday that it will revise the country’s fair trade act to strengthen criminal penalties against criminal collusion cases such as price rigging, collusive bidding and market allocation, and double the fine imposed on major violations including collusion and abuse of market dominance.

With the revision, the FTC will lose its exclusive right to report illegal business practices for a criminal investigation by prosecutors, leaving the right shared with various law enforcement bodies. In order to strengthen civil remedies, citizens will be allowed to request suspension of any unfair business practices that cause damages to them.

The government and the ruling party also came up with a plan to reform regulations for large-sized companies. Under the plan, the ownership stake in family-run conglomerates subject to a ban on intra-group transactions to prevent family profiteering will be 20 percent for both listed and unlisted firms, down from 30 percent for listed firms. The regulation will also be applied to subsidiaries in which a family owner holds more than a 50 percent stake.

The government also announced measures to support startups and venture companies. It decided to lower the minimum asset amount required to establish a venture holding firm to 200 billion won ($178.8 million) to 300 billion won from the current 500 billion won, and include small- and mid-sized firms that have high research and development spending in the list of venture firms eligible for the government’s support.

By Seok Min-soo and Choi Mira

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]