The government has revoked the nonprofit status of the Korean Egg Producers Association for arbitrarily setting and notifying egg farm prices. This action was taken after determining that the association violated permit conditions by restricting fair price competition through its price notifications.
On July 29, the Ministry of Agriculture, Food and Rural Affairs announced the cancellation of the association's nonprofit status. This decision follows the ministry's conclusion that the association breached the conditions of its incorporation and harmed the public interest by announcing farm prices. According to Article 38 of the Civil Act, a permit can be revoked if a corporation violates conditions or infringes on public interest.
The ministry had granted the association permission to establish as a nonprofit in January 2023, with the stipulation that it would comply with the Fair Trade Act and refrain from determining and notifying egg farm prices. However, the association violated these conditions by setting and notifying farm prices to its members until January of this year. The actual market transaction prices were also influenced by these announced prices, leading to an increase.
The Fair Trade Commission also deemed the association's price announcements as collusion. In June, the commission imposed a corrective order and a fine of 594 million won on the association for violating prohibitions against business organizations.
Prior to revoking the nonprofit status, the ministry conducted pre-notification, opinion submission, and hearing procedures in accordance with the Administrative Procedures Act. After reviewing the opinions and statements submitted by the association, the ministry found no grounds to overturn the violations.
The government explained that when a specific group sets and shares standard prices in advance, it stifles free competition between producers and sellers. However, it clarified that this action is an administrative measure against the nonprofit organization and does not directly impact egg production or distribution.
Currently, the Korea Livestock Products Quality Evaluation Institute is responsible for the price surveys previously conducted by the Korean Egg Producers Association. The government also plans to pursue institutional improvements to enhance the reliability and usability of transaction information.
On July 29, the Ministry of Agriculture, Food and Rural Affairs announced the cancellation of the association's nonprofit status. This decision follows the ministry's conclusion that the association breached the conditions of its incorporation and harmed the public interest by announcing farm prices. According to Article 38 of the Civil Act, a permit can be revoked if a corporation violates conditions or infringes on public interest.
The ministry had granted the association permission to establish as a nonprofit in January 2023, with the stipulation that it would comply with the Fair Trade Act and refrain from determining and notifying egg farm prices. However, the association violated these conditions by setting and notifying farm prices to its members until January of this year. The actual market transaction prices were also influenced by these announced prices, leading to an increase.
The Fair Trade Commission also deemed the association's price announcements as collusion. In June, the commission imposed a corrective order and a fine of 594 million won on the association for violating prohibitions against business organizations.
Prior to revoking the nonprofit status, the ministry conducted pre-notification, opinion submission, and hearing procedures in accordance with the Administrative Procedures Act. After reviewing the opinions and statements submitted by the association, the ministry found no grounds to overturn the violations.
The government explained that when a specific group sets and shares standard prices in advance, it stifles free competition between producers and sellers. However, it clarified that this action is an administrative measure against the nonprofit organization and does not directly impact egg production or distribution.
Currently, the Korea Livestock Products Quality Evaluation Institute is responsible for the price surveys previously conducted by the Korean Egg Producers Association. The government also plans to pursue institutional improvements to enhance the reliability and usability of transaction information.
* This article has been translated by AI.
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