Unilateral conduct

Unilateral conduct by non-dominant firms

Are there any rules applying to the unilateral conduct of non-dominant firms?

Article 23(1) of the MRFTA prohibits unfair trade practices. A non-dominant company can also be sanctioned for an unfair trade practice. Proscribed unfair trade practices are as follows:

  • unfairly refusing any transaction or discriminating against a certain business counterpart;
  • unfairly coercing or inducing customers of competitors to deal with oneself;
  • trading with a business counterpart by unfairly taking advantage of his or her position in trade; and
  • trading under the terms and conditions that unfairly restrict business activities of a business counterpart or disrupting business activities of other companies.

When it has found that an act violates article 23(1), the KFTC may order the firm to discontinue the act of violation, publish the fact that it is ordered to make a correction thereof and take other measures necessary for the correction (article 24 of the MRFTA); impose upon such a firm an administrative fine not exceeding an amount equal to 2 per cent of the relevant turnover.

According to KFTC practice, in many cases where a particular act constituted both the abuse of a market-dominant position and the unfair trade practice, all of the relevant regulations on both issues will be used in the review of legality. However, for issuance of corrective measures such as an administrative fine, regulations on the abuse of a market-dominant position will be applied.