Prosecutors have charged several major domestic petrochemical companies and their executives for colluding to fix prices of petrochemical products exceeding 16 trillion won, taking advantage of the national economic crisis caused by the war in the Middle East.
The Seoul Central District Prosecutors' Office's Fair Trade Investigation Division announced on October 1 that it has indicted six petrochemical firms—LG Chem, Aekyung Chemical, OCI, Lotte Fine Chemical, PKC, and Unid—on charges of violating antitrust laws. Among those charged are 43 current and former employees, including Kim Yoo-shin, CEO of OCI, and Jang Young-soo, former CEO of PKC.
Two executives, including PKC's head of sales and LG Chem's business division head, are currently in custody as they face trial. Hanwha Solutions, initially under investigation, was excluded from prosecution due to its cooperation under the leniency program for whistleblowers.
According to prosecutors, from January 2021 to April 2026, the companies are accused of executing a collusion scheme involving eight key petrochemical products, including polyvinyl chloride (PVC), plasticizers, caustic soda, and hydrochloric acid, amounting to a total of 16.3961 trillion won.
The collusion was highly organized and meticulously planned. It primarily took place through meetings among team leaders, where they pre-agreed on price fluctuations and timing for price increases.
To avoid suspicion, they even established a sequence for sending out price increase notifications. During major client bids, they coordinated in advance to ensure that the agreed-upon prices were reflected while maintaining market share, effectively conducting collusive bidding.
Even with changes in organization or personnel, they ensured the collusion continued by directly introducing successors to other companies, and some firms designated specific contacts solely for meetings with competitors, demonstrating their meticulousness.
Notably, they exploited the situation of rising costs due to the war between the U.S. and Iran, using it as an opportunity to improve their performance, despite the government allocating over 140 billion won to stabilize petrochemical production. The burden of rising raw material prices was ultimately passed on to consumers.
Earlier, on August 7, prosecutors launched a series of raids on the offices of the seven companies and the homes of key employees. Last month, they summoned key suspects, including the former CEOs Kim and Jang, for questioning. Subsequently, prosecutors applied for arrest warrants for six individuals, including the former CEOs, but the court rejected the requests.
* This article has been translated by AI.
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