Printing industry calls on Hansol Paper, Hankuk Paper MFG to roll back price hikes after cartel sanctions

South Korea's printing industry is demanding that major printing paper manufacturers, including Hansol Paper and Hankuk Paper MFG, immediately reverse price increases and discount cuts introduced in the second half of this year. The industry says pushing through price hikes is inappropriate given that the companies were sanctioned by the Korea Fair Trade Commission in April for price-fixing and have since been caught in an additional bid-rigging case.

The Korea Printing Cooperative Federation and 11 regional cooperatives issued a joint statement Wednesday urging the companies to halt the price increases, saying "unilateral price hikes by major printing paper conglomerates are threatening the survival of small printing businesses."

According to the federation, Hansol Paper and Hankuk Paper MFG recently notified their clients that they would raise prices on some products by up to 13 percent starting this month. The federation said the companies had also narrowed per-item discount rates or raised base prices in July and August.

The industry's growing backlash comes amid a string of cartel sanctions this year. In April, the Fair Trade Commission imposed a combined fine of 338.3 billion won ($251 million) on printing paper manufacturers including Hansol Paper, Hankuk Paper MFG and affiliates of Moorim, and ordered each company to independently reset its printing paper prices — a so-called "price redetermination" order.

At the time, the commission found that the paper companies had agreed in advance, starting in 2021 and for years afterward, to raise base prices and reduce discount rates on printing paper. The price redetermination order was intended to restore the competitive conditions that existed before the cartel by requiring each company to set its own prices independently.

This month, the commission also sanctioned bid-rigging in a printing paper tender issued by Nongmin Sinmun. It fined six companies — Moorim SP, Moorim Paper, Moorim P&P, Hansol Paper, Hankuk Paper MFG and Hongwon Paper — a combined 3.009 billion won, and decided to refer Hansol Paper and Hankuk Paper MFG to prosecutors.

The printing industry argued that if prices rise again through the price redetermination process under these circumstances, the cartel sanctions' purpose of restoring market competition would be undermined.

The federation said the paper companies were "continuing to cut discounts and raise prices rather than reducing costs and restoring competition," and called on the Fair Trade Commission to "thoroughly scrutinize the price-reset plans submitted by each company."

The federation also criticized support measures offered by the companies, including a "Donghang Project" through which Hansol Paper offered 600 million won and Moorim Paper offered 300 million won. It said improving the trading structures and pricing practices affected by the cartel should come before one-off support measures.

The federation urged the Fair Trade Commission to verify the price redetermination process of printing paper manufacturers and to take strict action against repeated cartel behavior, including criminal referrals.