POSCO E&C abuse subcontractors, Fair Trade Commission imposes penalty

Seoul [South Korea], May 6 (ANI/Global Economic): As POSCO E&C entrusted its work to a subcontractor">subcontractor, it made unfair special contracts and did not pay interest on the subcontract.
The FTC announced on Wednesday that it has decided to impose a correction order (prohibition of recurrence in the future) and a penalty of 14 million won for violations of POSCO E&C's Subcontract Act (Act on Fair Subcontract Transactions). Regarding the reason for not making the complaint, the Fair Trade Commission explained that "the standards of the Fair Trade Act (Monopoly Regulation and Fair Trade Act) prosecution guidelines have not been exceeded".
This decision was also affected by POSCO E&C's paying all of the 15.56 million won of interest back within 30 days of the commencement of the FTC's site investigation.
According to the Fair Trade Commission, POSCO E&C committed various unfair acts during transactions with 237 subcontractor">subcontractors from February 2014 to April 2019. 84 projects, including reinforced concrete works, were entrusted to 68 companies, and an unfair special contract clause stating, "All necessary matters for performing the construction will be borne by the subcontractor">subcontractor" was inserted into the contract.
15 subcontractor">subcontractors were paid after 15 days from the date of receiving the advance payment from the ordering company and were not paid interest of 2,487,000 won. 13 subcontracts are paid on the basis of a bill replacement payment method that exceeds 60 days from the date of completion of work (a receipt of the object), and the corresponding fee is 90,625,000 won, and 52 subcontracts were not paid the interest of 28,221,000 won for the late competition of works.
In addition, the company did not inform the reason and details to 54 subcontractor">subcontractors, or notified them late, receiving an additional fee for design change from the ordering company. 32 companies were not paid 30,227,000 won of interest for late additional subcontracts.
The Fair Trade Commission said, "We have sanctioned POSCO E&C to improve the efficiency of case handling, which has been reported by several subcontractor">subcontractors," and added, "We will establish a fair subcontracting transaction order by strictly investigating companies that receive a large number of reports in the future."(ANI/Global Economic)