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South Korea: LG bullying of local branches earns fine

 |  January 8, 2014

South Korea’s Fair Trade Commission announced Wednesday it imposed a fine of $1.78 million on electronics giant LG Electronics Inc.

Reports say the FTC found LG to have abused its dominant market position in its business with local sale branches, forcing the branches to cover some or all losses resulting from failed payment by certain device builders.

Specifically, the FTC said, the branches were burdened with covering losses if builders failed to pay for build-in electronic products included in new apartment buildings.

LG has reportedly insured itself against the possibility of failed payment by builders since 2008; later on, however, LG began to place that burden of covering losses on smaller sales units, according to the FTC.

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