Prosecutors Indict and Detain Senior Executives of CJ CheilJedang and Samyang Corporation for Alleged 3 Trillion Won Sugar Price-Fixing Scheme

The prosecution has brought to trial both current and former executives, including senior management from CJ CheilJedang and Samyang Corporation, as well as the companies themselves, on charges of involvement in a sugar price-fixing scheme worth 3.2715 trillion won.
The Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office, led by Chief Prosecutor Na Hee-seok, announced on the 26th that it had indicted and detained Mr. A, former head of food at CJ CheilJedang, and Mr. B, who served as CEO of Samyang Corporation until recently, on charges of violating the Monopoly Regulation and Fair Trade Act (MRFTA). Four other executives, including vice presidents and managing directors from both companies, as well as five working-level employees and two corporate entities, were indicted without detention on the same charges.
Prosecutors determined that three sugar companies colluded to adjust the timing and extent of sugar price changes, a staple commodity for the public. The scale of the price-fixing reached 3.2715 trillion won, and as a result, sugar prices reportedly rose by as much as 66.7%. The indictment noted that while increases in raw sugar prices were immediately reflected, price reductions were minimized when raw sugar prices fell, allowing the companies to reap profits and shift the burden onto consumers.
During the collusion period, the price of raw sugar rose from 386 won in January 2021 to 801 won, while the price of sugar surged from 720 won to 1,200 won. Even after the raw sugar price dropped to 578 won in April this year, the sugar price only decreased slightly from 1,200 won to 1,100 won. It was also pointed out that the price at the beginning of this year remained 55.6% higher than before the collusion.
From 2020 to 2024, the rate of sugar price increase due to collusion was 59.7%, far outpacing the consumer price index increase (14.18%) and the rise in food and non-alcoholic beverage prices (22.87%) over the same period.
A prosecution official stated, "We will send a strong message to the market that those who disrupt the livelihoods of ordinary citizens through price-fixing will be strictly punished." The official added, "We will make every effort to maintain the indictment and will continue to respond firmly to individuals who play a leading role in price-fixing schemes."
The prosecution received the case last September and simultaneously conducted raids and detentions of those involved at the three sugar companies. During the investigation, the prosecution exercised its authority to request the Korea Fair Trade Commission (KFTC) to file complaints against 11 individuals implicated in the scheme.scottchoi15@fnnews.com Choi Eun-sol Reporter