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Hanwha Ocean Geoje Shipyard (Photo courtesy of Hanwha Ocean) |
[Alpha Biz= Kim Jisun] South Korea’s Fair Trade Commission has decided to extend by three years the compliance period for remedies imposed on Hanwha Group following its acquisition of Hanwha Ocean, marking the first such extension in a merger review case.
The FTC said on the 28th that it will extend the remedy period tied to the combination of Hanwha Aerospace, Hanwha Systems, and Hanwha Ocean until May 2, 2029. The regulator added that it may further extend the period by up to two additional years depending on future changes in market competition and regulatory conditions.
The remedies were initially imposed in May 2023 to address concerns over potential restrictions on competition in naval vessel bidding, including for surface ships and submarines. They prohibit practices such as discriminatory pricing of ship components, refusal to provide technical information requested by competitors via the Defense Acquisition Program Administration, and sharing of competitors’ trade secrets within Hanwha affiliates.
The FTC’s review of market conditions from 2023 to 2025 found that Hanwha Ocean continues to hold a dominant position in naval shipbuilding, while Hanwha Aerospace and Hanwha Systems remain either monopolistic or leading players in eight out of ten key ship component markets.
The regulator concluded that competition concerns—such as limited alternative suppliers, potential exclusionary effects through pricing discrimination, and restricted access to technical information—have not been fully resolved. As a result, it extended the remedies for naval vessels and the eight component markets, with a possible additional extension capped at two years.
However, the FTC determined that competition concerns have eased in the Identification Friend or Foe (IFF) systems and Integrated Platform Management System (IPMS) markets due to new entrants and shifts in market share, and accordingly decided to terminate remedies in those segments.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
