바카라온라인

1. Case summary

ㅇ The Korean Fair Trade Commission (the "바카라온라인") commenced investigation of local transportation service providers for the allegation that they had made agreements on rates and not to mutually interfere with other service providers’ interest in the delivery service for house-moving goods of the US armed forces in Korea from 2011 to 2019.

ㅇ There are barriers to enter the market for the delivery service for house-moving goods of USFK because prospective service providers are required to be equipped with physical facilities such as logistics warehouses and be subject to supervision and a prior approval of the USFK authorities.

ㅇ In addition, prospective service providers need to make a transactional relationship with foreign transportation service providers who execute a contract with the US Command to be placed orders, and consequently, the foreign transportation service providers have a status superior to the local transportation service providers in the market.


2. Our role

ㅇ Representing the local transportation service providers, we actively clarified that (i) there are limited competition from the beginning due to restrictions to entering the market and foreign transportation service providers have a superior power in the market due to the structural characteristics of the relevant market; (ii) according to the amendment to the notification of the 바카라온라인, business operators reporting the annual sales of KRW3 billion are subject to supervision for an warning, and most of local transportation service providers are small-scale business subject to the regulation; and (iii) local transportation service providers have reported a great loss due to the Covid-19 pandemic and the ban on movement issued in the US armed forces in Korea.


3. Decision

ㅇ The 바카라온라인 accepted the opinions clarified by us, and unprecedently decided that the local transportation service providers be clear of all the surcharges and the criminal charges for the following reasons:

- a majority of the local transportation service providers subject to this case constitute a small-scale business reporting less than KRW3 billion in sales, and their alleged collusive act does not have a great ripple effect in the market; and

- it is hard to find circumstances in which the rates have increased or the transaction volume has decreased due to the alleged collusive act, and therefore, it is hard to conclude that there is an effect significantly limiting competition in the market or the size of unjust enrichment and damage is significant.


4. Implications

ㅇ In general, the 바카라온라인 isseus an order to correct and/or to pay surcharges, and/or criminal charges against collusion (i.e., unfair collusive acts).

ㅇ In the case of small and medium sized companies, they have limited human and physical resources. Thus, if they are subject to sanction, they are likely to have serious difficulties in running business.

ㅇ However, simply because the size of business is not large does not become a reason for mitigation of sanction under the law. Thus, it is important to specifically identify and clarify reasons for mitigation that reflect the characteristics of the market, the 바카라온라인’s position and the rapid changes in market environment.

ㅇ In the situation where it is expected that the 바카라온라인 will issue an order to pay surcharges and bring criminal charges to the prosecution, we have persuaded the 바카라온라인 that sanctions need to be mitigated by analyzing the characteristics of the market. This case will be a precedent for cases in which the mitigation of sanction and the degree of mitigation are issues.