Fair trade watchdog inspects manufactured products, foods

The Fair Trade Commission is confirmed to be inspecting the prices of manufactured products and processed foods as well as those of oil products, while probing allegations of unfair trading by companies.

The trade watchdog is poised to conduct a probe at its own discretion into individual products whose prices have not gone up without circumstantial evidence of price rigging. This has sparked criticism that the agency is abusing its power and infringing on corporate business operations.

The commission announced Monday a new task force on “surveying and responding to price concerns” under direct supervision of the vice chairman early this month. The task force is investigating more than 40 companies including those in oil refining, a sector into which the government recently launched a probe under President Lee Myung-bak’s order.

Others probed are companies that produce and sell foodstuffs including flowers, soybean milk, coffee, side dishes including kimchi and pickled radish, and daily necessities such as food ingredients and kitchen supplies.

The commission has secured all data allowing it to analyze production costs of these companies, internal corporate materials including those for outsourcing and supply contracts, and documents on meetings between same-industry companies through onsite inspections that started on Jan. 10.

The inspections target unfair trade practices in overall business operations, including anti-trust activities, abuse of market dominance, and illicit internal transactions.

The trade probe will expand into other items among 103 products the government constantly monitors to stabilize the livelihood of the working class but are excluded from investigation. As the trade watchdog has launched a massive probe at its own discretion without securing specific evidence or internal whistleblowing, experts criticize the move as abuse of inspection authority.

Yonsei University marketing professor Oh Se-jo said, “Demanding that companies submit operational secrets, including cost data on products whose prices have not risen, constitutes violation of the Fair Trade Act article that says, ‘It must complete inspection under the minimum scope of data required.`”

weappon@donga.com