South Korea Fines Rail Companies For Cratel Activity

Three train manufacturers have been fined a total of 56.4 billion won ($43 million) for collusion.  

The companies — Hyundai Rotem, Woojin Industrial Systems and Dawonsys — are the only train manufacturers in the country.    

According to the Fair Trade Commission (KFTC), the companies coordinated on bidding for 11 accounts valued at 2 trillion won. The GTX was included on the list of projects for which the companies had agreements.  
The collusion started when Hyundai Rotem proposed in 2013 to Woojin Industrial Systems that they agree to limit competition.  

Hyundai Rotem was created in 1999 when three companies, Hyundai Precision Industry, Daewoo Heavy Industries & Machinery and Hanjin Heavy Industries & Construction, merged.    

The first collaboration was a 2013 bid for the Gimpo Goldline, a railway that connects Gimpo city with the Gimpo International Airport in Gangseo District, Seoul.    

They started colluding for other bids, including for projects related to Seoul lines No. 2, No. 5 and No. 9 and Korail’s Airport Railroad Express (AREX), which connects Seoul with Incheon International Airport, and the Busan subway.    

In the agreement, Hyundai Rotem would be the only bidder, and Woojin Industrial System would exclusively supply the parts.  

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