The first case in South Korea in which behavioural remedies have been prolonged following a merger review, reinforcing regulatory scrutiny of concentration in naval shipbuilding supply chains. 

South Korea’s competition authority has extended by three years the remedies imposed on the merger between Hanwha affiliates and the former Daewoo Shipbuilding, according to the Korea Fair Trade Commission. The decision keeps strict behavioural constraints in force across naval shipbuilding and key component markets after the regulator found that competition risks remain unresolved.

Submarine tenders 

The measures apply to warship and submarine tenders and eight component segments where the merged group continues to hold dominant or monopoly positions. The remedies prohibit discriminatory pricing of ship components, refusal to provide technical data requested via the Defense Acquisition Program Administration, and the transfer of competitors’ confidential information within Hanwha affiliates.

The authority will reassess the market

The authority will reassess the market after the extension period, with the option to prolong the measures by up to two additional years. The review confirmed that Hanwha Ocean Co., Ltd. remains the leading player in both surface vessel and submarine construction. At the same time, Hanwha Aerospace Co., Ltd. and Hanwha Systems Co., Ltd. continue to dominate most of the affected component markets.

Competing shipbuilders

Competing shipbuilders still face limited alternatives for sourcing key systems, sustaining risks of input foreclosure. Two-component markets were cleared of remedies after new entrants and shifts in market shares reduced competitive concerns. The regulator found no material changes in procurement rules or oversight mechanisms that could replace the existing safeguards and confirmed there were no violations of the remedies during the initial compliance period.

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The first case in South Korea

The extension marks the first case in South Korea in which behavioural remedies have been prolonged following a merger review, reinforcing regulatory scrutiny of concentration in naval shipbuilding supply chains. Hanwha Ocean Co., Ltd. is a shipbuilding company incorporated in the Republic of Korea, engaged in naval vessel construction, offshore engineering projects, and commercial shipbuilding as part of the Hanwha Group

About : Hanwha Ocean Co., Ltd. 

Hanwha Ocean Co., Ltd. is a shipbuilding company incorporated in the Republic of Korea, engaged in naval vessel construction, offshore engineering projects, and commercial shipbuilding as part of the Hanwha Group.

#Hanwha Ocean #Competing shipbuilders #Defense Acquisition Program #Daewoo Shipbuilding #Korea Fair Trade