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Photo = Fair Trade Commission |
[Alpha Biz= Kim Jisun] South Korea’s Fair Trade Commission (KFTC) announced on June 17 that it has imposed fines totaling KRW 2.074 billion (approx. USD 1.5 million) on 38 water tank manufacturers and suppliers, including Sungji Engineering and Sejin SMC, for engaging in a six-year bid-rigging scheme on large-scale construction projects.
Between December 2016 and January 2023, the companies colluded on 290 water tank supply bids issued by 18 major construction firms. The firms pre-arranged winning bidders and bid prices via phone calls and mobile messaging apps. Non-winning “cover” bidders were instructed to submit pre-agreed prices to simulate legitimate competition.
In some cases, a designated company played the role of coordinator, managing communication among bidders and resolving disputes.
The water tanks in question are custom-built structures used in apartment complexes and office buildings to ensure potable water supply, as required by building regulations. Collusive bidding in this sector can directly affect apartment pre-sale costs, making this the KFTC’s first enforcement action against bid-rigging in water tank tenders.
The collusive activity generated KRW 50.7 billion in revenue for the companies involved. Major construction firms impacted by the scheme include HDC Hyundai Development Company (KRW 10.8 billion), Hoban Construction (KRW 5.69 billion), and GS Engineering & Construction (KRW 5.1 billion).
AlphaBIZ Kim Jisun(stockmk2020@alphabiz.co.kr)
