South Korea’s antitrust watchdog said Friday it has decided to impose a fine of 970 million won ($808,000) on Hyundai Heavy Industries for misappropriating technical data from a subcontractor.

The Fair Trade Commission said HHI “forcibly obtained” the technical data of pistons for its diesel engine from a subcontractor. HHI had maintained a close partnership with the company for over two decades in its move to localize key components, the watchdog explained.

It also did not issue a legal letter to the partner firm in requesting the technical data, it added.

The shipbuilder then transferred the technical data to another subcontractor to replicate the piston and diversify its production -- and lower prices. It also unilaterally stopped business transactions with the original subcontractor, the agency noted.

The original subcontractor, which the FTC did not identify, was founded in 1975 and specializes in engine parts. It was selected as one of 100 small but strong parts suppliers by the Ministry of SMEs and Startups in 2019.

The FTC said a company should not request technical data from subcontractors without justifiable reason or divert technical data from subcontractors. If they request technical data for legitimate reasons, they should issue a written letter.

“This is the highest fine for misappropriating technical data. We will continue to strengthen our monitoring and sanctions on such unfair business practices,” an FTC official said.

By Shin Ji-hye (shinjh@heraldcorp.com)