The Seoul High Court (6th Administrative Branch) dismissed Asiana Airlines’ claim in the lawsuit filed by Asiana Airlines on May 31 for corrective order and cancellation of penalty payment order (2020nu 66475), and the Fair Trade Commission (Chairman Ki-Jeong Han) declared a ruling in favor did.
On November 6, 2020, the Fair Trade Commission supported Kumho Express for Asiana Airlines to issue bonds with warrants (BW) under favorable conditions (0% interest rate, maturity of up to 20 years) through the medium of the exclusive right to supply in-flight meals (30 years). A correction order and a fine of 8.147 billion won were imposed on the violation of the act of providing unfair benefits and unfair support to a person in a special relationship.
At the time, the Fair Trade Commission also sanctioned (a total of 32 billion won in fines) for the acts of systematic support of Kumho Express, which is at the apex of group governance, by corporate group ‘Kumho Asiana’ affiliates, including the above acts, and disobeyed two other dispositions besides this case. A lawsuit was also filed and is currently pending in the Seoul High Court.
Asiana Airlines filed a lawsuit to cancel the disposition with the Seoul High Court on December 11, 2020, dissatisfied with the FTC disposition. Considering that it was acknowledged that it belonged to Expressway and its controlling shareholder, Park Sam-koo, Asiana Airlines’ claim was rejected, and the Fair Trade Commission ruled that the disposition was lawful.
In the judgment, the court said that Asiana Airlines entered into a contract to supply in-flight meals with a new in-flight meal supplier in this case, so that the foreign group (Gate Group) to which the third-party catering supplier belonged received BW in this case on terms significantly favorable to Kumho Express. It was possible to acquire it, and considering the related contract process and the BW conditions in this case, it was judged that there was no reason for the Gate Group to proceed with the BW acquisition in this case if there had not been a contract to supply in-flight meals.
Asiana Airlines also argued in the lawsuit that there was no reason for the Fair Trade Commission to dispose of the in-flight meal supply contract, which was made as an abuse of representative power and breach of trust by the same person at the time of the violation of the law in this case, but the court argued that even if the legal act is judicially invalid Even so, it was explained (explained in an easy-to-understand manner) that it is reasonable to believe that the Fair Trade Commission can judge whether unfair support and unfair profit-providing acts are established according to the Fair Trade Act, which stipulates obligations under public law, and impose sanctions accordingly.
In addition, if it is judged that the support entity cannot be sanctioned due to judicial invalidity, in fact, the support entity cannot be sanctioned with the provisions of the Fair Trade Act for illegal acts of support or provision of unfair profits for the family’s treacherous private profit exploitation. It can be, so it was mentioned that it does not fit with the sanctions and rulings so far.
The latest ruling found that unfair insider transactions made indirectly through a third party, rather than direct insider transactions within a business group, for the purpose of maintaining and strengthening the controlling family’s dominance are also illegal, and the Fair Trade Commission found that regardless of whether the transaction itself in question was legally effective or not, the KFTC was unlawful. It is significant in that it made it clear that insider trading can be sanctioned.
The Fair Trade Commission plans to analyze the contents of the ruling to prepare for future appeals to the Supreme Court, while actively responding to the remaining cases pending litigation.
2023-06-07 01:02:00
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