A Final Resolution Cannot be Achieved the LPG Price-Fixing Case
- 2009.12.03 (14:15:00)
Immediate actions should be taken including passing class action laws to protect victims; PSPD to facilitate public interests lawsuits
On December 2, 2009, the Fair Trade Commission (FTC), chaired by Jeong Ho-yeol, levied a 6689 mil. Won (about $6.5 million) penalty on six LPG supply companies: E1, SK Gas, SK Energy, GS Caltex, Hyundai Oil Bank, and S-Oil. During at 20 meeting over past 6 years, these companies fixed LPG prices 72 times, earning them more than 21 trillion Won (About $20 billion). The People's Economic Committee, chaired by Kim Jin-bang who is a professor at Inha University, in the PSPD was pleased the strict restriction of the price collusion that the FTC imposed on LPG supply companies, which had been dragged on since November of 2009.
However, the FTC has other duties to fulfill. Although the fine imposed on the six LPG companies was paid to the government, the consumers’ losses during the LPG price collusion and the companies’ poor treatment of consumers are remain problems. The FTC should remember that disregarding the amount of the penalty that imposes on the companies, LPG consumers will suffer from the companies’ price collusion.
Most of victims were working class, people with disables and war veterans. Nevertheless, due to lack of relevant laws for this case, their financial losses cannot be fully compensated and their treatment by the oil supply companies has not been improved. In addition to 6,689 trillion Won penalty was for less than the 21 trillion Won profits the companies made from price fixing. Considering previous price-fixing cases, it is expected that the victims will not receive full compensation for their losses.
If the FTC has the will to compensate the victims for their losses, it should take strong actions to improve this unfair situation by legislating to prevent any future victims. Class action system should be introduced, or the FTC should establish appropriate countermeasures to protect victims such as taking legal action to defend the victims and giving financial support for their lawsuits.
Companies are already worried about the side effects of introducing a class action system because it may open the door many lawsuits. Under the current law, there is no legal system to protect future victims from the arrogant of big corporations. The government should pay attention to the demand for class action laws because it is likely to reduce big corporations’ tyranny, and protect consumers’ rights.
The PSPD is going to bring a suit against the six LPG corporations on the behalf of the victims and to recover their losses.