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Court Revokes KFTC’s Corrective Order Against Global Bank for Alleged Bid Rigging Regarding Cross-Currency Swap Contracts


The Seoul High Court revoked sanctions imposed by the Korea Fair Trade Commission (the “KFTC”) against a global bank (the “Complainant”) for allegedly engaging in bid rigging regarding cross-currency swap (“CCS”) contracts with a public corporation by agreeing with two other banks on the bid amount for the fixed KRW interest rate (to convert foreign-currency-denominated bonds into debt in KRW) and the winning bidder.  Representing the Complainant in its appeal of the KFTC’s sanctions, Kim & Chang managed to persuade the court to revoke the corrective order imposed by the KFTC.

We were able to completely overturn the KFTC’s decision with the court fully accepting our arguments that there was no competitive bidding involved in the first place that could have been rigged by the banks.  The court also concluded that there was no other evidence that the banks had engaged in the alleged bid rigging.

Our representation of the bank involved (i) in-depth research into the characteristics of CCS deals and market practice, (ii) rigorous fact-finding in relation to communications between the parties, and (iii) extensive analysis of numerous past decisions on bid rigging and related anti-competitive effects.  By making use of objective data and expert witnesses to effectively explain to the court the concepts and market practice of CCS deals, which are complex financial derivative instruments, we were able to reach a successful outcome for our client.