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Internal trading by top 10 conglomerates accounts for 70% of disclosed transactions in 2025

Published: 03 Dec. 2025, 13:58 Updated: 03 Dec. 2025, 14:03

Office workers are seen at a large conglomerate in Seoul on Feb. 28, 2018. [YONHAP]

Transactions among affiliates of Korea's 10 largest family-run conglomerates accounted for nearly 70 percent of the total disclosed trading in 2025, the country's corporate watchdog said Wednesday.

According to the Fair Trade Commission (FTC), the total value of interaffiliate transactions by the top 10 conglomerates reached 193 trillion won ($131 billion) this year, representing 68.7 percent of the 281 trillion won reported by a total of 92 business groups.

The 10 major conglomerates include Samsung Group, the country's largest conglomerate and home to global memory chip leader Samsung Electronics, as well as multi-industry giant SK Group and LG Corp.

The FTC said the top 10 have maintained an average internal transaction ratio of around 13 percent over the past decade.

During the cited period, HD Hyundai and Hanwha recorded the largest increases in intra-group transaction ratios, rising by 7 and 4.6 percentage points, respectively, while LG and Lotte Group posted the largest declines, dropping by 7.3 and 2.4 percentage points, respectively.

Internal trading within conglomerates has often been criticized for allowing owner families to secure significant profits by awarding lucrative contracts to their subsidiaries.

The FTC noted over the past five years, companies with higher family ownership consistently displayed higher internal transaction ratios.

A similar pattern was observed among second-generation family stakes, particularly from 2022 onward, with companies that have more than 50 percent second-generation ownership showing markedly higher levels of internal trading compared to previous years.

By sector, the software and IT services industry, as well as the automobile and trailer manufacturing sector, ranked highest in both ratios and total transaction amounts.

The government has encouraged family-run conglomerates to adopt holding company structures to simplify their complex and opaque governance systems, but the measures have had limited effect in reducing internal trading.

The FTC emphasized that while the volume or proportion of interaffiliate transactions alone does not prove unfair practices, regular monitoring and continuous oversight remain essential to preventing abuse.

Since 2011, the FTC has annually analyzed and published data on internal transactions within disclosed business groups to improve their practices through market-driven oversight.

Yonhap