South Korea’s antitrust regulator said on July 6 it imposed a combined $15 million in fines on a regional gas-station association and two agricultural cooperatives after finding they coordinated retail fuel prices on Jeju Island for nearly two years.
The Korea Fair Trade Commission ordered corrective measures against the Jeju branch of the Korea Gas Station Association and imposed a fine of about $22,000. Jeju NongHyup and Seogwipo NongHyup were fined approximately $7.2 million and $7.5 million, respectively.
The regulator said the association received advance pricing information from the two cooperatives between September 2022 and July 2024 for gasoline, diesel and kerosene scheduled to take effect the following day.
Using that information, the association established benchmark retail prices and distributed them to member gas stations through KakaoTalk group chats, text messages and other channels, directing members to adhere to the recommended prices.
The association represented 116 gas-station operators on Jeju Island as of 2024.
According to the commission, Jeju NongHyup and Seogwipo NongHyup shared their next-day fuel prices with the association before publicly posting them on Opinet, South Korea’s fuel-price information system.
The two cooperatives also worked with the association to decide whether prices should be raised or maintained and identified stations selling below the agreed benchmark, notifying the association to encourage compliance.
Because the cooperatives operate government-backed discount gas stations that typically offer lower prices than private competitors, their pricing carried significant influence in the local market, the commission said. Private retailers had an incentive to obtain advance knowledge of those prices, while the cooperatives had an incentive to limit price competition by sharing the information.
Investigators also found the association recognized its conduct could violate competition law. During periods when the Fair Trade Commission was investigating similar industries, the association reportedly switched from group messaging to phone calls and in-person meetings to communicate pricing guidance.
The association also instructed members to delete pricing messages and avoid disclosing the information outside the organization, according to the regulator.
The Fair Trade Commission said the association and the two cooperatives actively participated in coordinating retail fuel prices with the intent of restricting competition, depriving consumers of the lower prices that could have resulted from independent pricing decisions.
