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Korean courts side with companies in 31 of 39 bids to suspend Fair Trade Commission decisions
Korean courts granted 31 of 39 corporate requests this year to suspend Fair Trade Commission decisions, against a 61.4% rate over the prior decade. What companies win is time before sanctions apply, and what that time is worth depends on how the main lawsuits end.
The Investor · Invest desk
What happened
- Only two requests were rejected this year, 5.1% of those filed, and six are still waiting for a court ruling.
- The annual grant rate rose to 73.5% last year from 64.5% in 2024, while the rejection rate fell to 23.5% from 32.3%.
- The Seoul High Court suspended an FTC document demand against Hanwha, issued in a probe of trademark royalties among its affiliates, until Jan. 31 next year.
- Coupang lost a bid to block an FTC on-site inspection after the Seoul High Court judged that a suspension would weigh more heavily on the public interest.
Compiled by The InvestorSomething wrong?How this is made
Why it matters
- constraint A suspended document order holds up an investigation before any sanction exists, so Hanwha's win delays the case itself as well as any eventual payment.
- precedent Courts are applying the irreparable-harm test to investigative steps as well as fines, so the FTC's evidence on harm now decides whether its probes proceed.
- decision The FTC has to weigh a move to compulsory investigations, a step Lee Hwang said would inevitably raise the burden on companies.
Leave out the six requests still waiting on a judge, and courts have ruled for companies, in full or in part, in 31 of the 33 they have decided this year. That is about 94% [1]. The 39 filings so far [1] compare with an average of 36 a year over the previous decade [2]. Slightly more companies are asking, but most of the change is in how judges answer.
Most of the rise comes from partial grants. Full suspensions were 18 of 39 requests this year, about 46%, against 156 of 360, about 43%, from 2016 through last year [3]. Partial grants went from 65 of 360, roughly 18%, to 13 of 39, a third [4]. This year's combined rate is about 18 points above the decade's 61.4% [5], and partial grants account for about 15 of those points [5]. The data does not say which parts of those 13 decisions were suspended.
A suspension defers a decision. It is frozen only until the main lawsuit is resolved [4]. A grant is also not a finding that the FTC was wrong: judges weigh factors such as whether immediate enforcement would cause irreparable harm [7]. For a company facing a fine, the injunction buys time, or more precisely the use of the money for as long as the main case runs.
From here the outcomes split. If the FTC wins most main suits, companies pay later and the commission loses months. If it starts losing them more often, the injunctions were an early sign of those losses, and the deterrent is weaker in substance as well as in timing. Separately, companies now go to court over document demands and on-site inspections as well as over fines [8].
The two investigation-stage rulings in the record split, one each way [9] [11]. FTC Chairman Joo Byung-ki said there had been no problems with the investigation procedure, and called it deeply regrettable that the commission's investigation had been neutralized by a company's injunction suit [10]. In the Coupang case, an FTC official said the commission won by showing the company would suffer no irreparable harm if the inspection went ahead [12].
I think the 79.5% figure [2] overstates how much enforcement the FTC is losing. Most of the rise is partial, and every suspension, full or partial, ends when the main case does [4]. The test of that view is in the main-case record. If the FTC is losing more of the lawsuits themselves, the injunctions were early warnings, and the deterrent is weaker than this column allows. Both sides are already paying for the procedural fight. Lee Hwang, a law professor at Korea University, said that when disputes grow over investigative methods or investigative authority, companies and the commission get dragged into a needless, draining fight with each other before anyone has established the merits of a violation [13].
What to watch
- Rulings on the six pending requests, which will put this year's final grant rate somewhere between 79.5% and about 95%.
- Whether the FTC's document order against Hanwha takes effect when the court's suspension lapses, or the suspension is extended.