Local company penalized for country of origin mislabeling

By Lee Joon-seung
SEOUL, June 25 (Yonhap) -- The government said Thursday it will penalize a local
company for exporting Chinese-made ball bearings to Turkey with the products'
country of origin mislabeled.
A sizable percentage of bearings exported to Turkey by the NSC Korea Co. were
wholly or partly manufactured in China, but the company shipped the products as
having been made in South Korea, the Korea Trade Commission (KTC) said.
It said NSC Korea has been ordered to halt its export of the Chinese bearings,
while the company will be fined 2.3 million won (US$1,790) for trade violations
and unlawful labelling practices.
"The products were 12-41 percent cheaper than those made by other South Korean
companies, which hurt bearings sales of those domestic manufacturers," a
government official said. He added that because the Chinese bearings were sold as
having been made in South Korea, substandard imports resold in Turkey could
affect the brand recognition of other locally made bearings that can translate
into sales losses down the road.
The investigator said that under existing rules, the bearings should have been
marked as having been made in China.
The commission under the Ministry of Knowledge Economy said the company located
in Hwaseong, 50 km southwest of Seoul, sold an estimated 73 million won worth of
bearings to Turkey, with investigators finding false country of origin labels on
23 million won worth of exports, roughly 30 percent of the total.
The KTC said it began a probe early this year after receiving complaints by
buyers in Turkey and the Korea Association of Machinery Industry in September
2008.
It checked NSC's manufacturing facilities and visited Turkey to determine the
extent of illegal labeling practices.
yonngong@yna.co.kr
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