Acquittal in a criminal case under the Fair Trade Act over alleged collusion on scrap steel purchase prices

Major Korean steelmakers were indicted for violating the Monopoly Regulation and Fair Trade Act (the Fair Trade Act) on charges of colluding on base purchase prices for scrap steel.

Attorney Jaehoon Lee joined the defense team for one of the steelmakers and handled the criminal trial.

The steelmakers' purchasing managers had exchanged information on purchase prices and inventory levels, and some statements effectively admitting to collusion had been obtained during the investigations by the Korea Fair Trade Commission and the prosecution.

The central issue was whether such information exchanges and statements alone were enough to establish an unfair concerted practice under the Fair Trade Act.

We pointed out that many of the statements admitting to collusion were answers based on premises presented during questioning, or were merely speculation and opinion, and challenged the contradictions and credibility of those statements through witness examination.

We also analyzed the nature of the price information exchanged, the actual movement of purchase prices, the characteristics of the scrap steel purchasing market and trading patterns inconsistent with collusion, and argued that no collusion had been established.

In addition, we reviewed and applied case law distinguishing a mere exchange of information from the collusion prohibited by the Fair Trade Act.

The court found that collusion had not been proven for part of the charged period and acquitted on that portion, and dismissed the charges for the remaining period because the statute of limitations had expired.

As a result, the operative part of the judgment declared the client not guilty.