South Korea’s Fair Trade Commission (FTC) has imposed fines totaling 18.3 billion won ($13.8 million) on 20 furniture companies for colluding in bids for apartment system furniture contracts. The regulator also referred four firms to prosecutors for further legal action.
According to the FTC, from February 2012 to November 2022, the companies secretly coordinated bid winners and prices for 190 system furniture procurement contracts issued by 16 major construction firms across the country. The affected contracts, worth approximately 332.4 billion won ($250 million), included built-in furniture such as dressers and pantry units for new apartment complexes.
The companies allegedly used methods such as lotteries and rotation systems to preselect bid winners. Losing bidders, known as “cover bidders,” were compensated through subcontracted work or cash payments. The collusion resulted in an average winning bid rate of nearly 100%, the FTC reported.
Among the penalized firms, Dongseongsa, Spacemax, Jamat, and Hanssem were referred for criminal prosecution due to their role in orchestrating the scheme. The largest fines were imposed on Dongseongsa (4.47 billion won), Spacemax (3.82 billion won), and Yeongil Industrial (3.32 billion won).
This case marks the third time in recent months that the FTC has cracked down on bid-rigging in apartment interior projects. Similar fines were issued in April 2024 for built-in furniture bids (931 billion won) and in October 2024 for bathroom system bids (67 billion won).
The FTC emphasized that bid-rigging in public and residential projects inflates housing costs and vowed to strengthen oversight of collusion in key consumer sectors. Additional investigations into smaller construction firms’ furniture procurement are ongoing.
