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The Seoul High Court on Thursday ruled that the Fair Trade Commission must retract its 2001 order against three Chosun Ilbo newspapers - the Chosun Ilbo, the Sports Chosun and the Digital Chosun - to make corrective measures because of alleged illegal internal dealings. The court decided that the ruling against the Chosun Ilbo was unjustified and therefore invalid, doing away with the last of the penalties the FTC imposed against media outlets during Former President Kim Dae-jung's term.
The court pointed out that the commission decided that the relatively high costs the Chosun Ilbo paid to its printing subsidiary, Chogwan Publishing, amounted to illegal internal assistance. But the court ruled it was not financial assistance, but only "merchandise service dealing," at a support level that should not be prosecuted.
The FTC was wrong in applying the law, the court said. "If we punish all of the activities which include the indirect support effect which accompanies the service dealing, then it would be a too excessive application of the law." It would also infringe on asset ownership rights, the court said.
The FTC ordered the Chosun Ilbo in July 2001 to pay 3.35 billion ($3 million) in back taxes, along with the correction order. That came after the thorough investigations into many newspapers and broadcasters in February to April 2001, when the Chosun Ilbo was charged with unfair dealing with subsidiaries.
But the commission at the end of last year retracted the total W24.2 billion in penalties it had imposed on 13 media companies, enraging then President-Elect Roh Moo-hyun. Thursday's ruling means that all the punishment it imposed on media outlets during the Kim administration has been reversed.
(Jeon Su-yong, jsy@chosun.com )
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