France’s Gaztransport & Technigaz (GTT) has been hit with a €9.5m ($11.3m) fine from the Korea Fair Trade Commission (KFTC) today, the latest chapter in a lengthy spat between the world’s top LNG membrane producer and the world’s leading LNG shipbuilding nation. GTT said today it would appeal the fine.
The KFTC ruled that some of GTT’s commercial practices have not complied with Korean competition regulations since 2016.
South Korea’s top shipyards pay GTT a licence fee for using its proprietary membrane containment system on the LNG carriers they build, something that has been the source of much contention for more than a decade.
In a release today, the French company stated: “GTT wishes to emphasize that the licence of the technology and the technical assistance constitute an inseparable offering, which guarantees the integrity of its technologies, and that any separation could be detrimental to the entire LNG carrier industry. The company challenges the rationale of this decision and, upon receipt of the KFTC’s written decision, intends to appeal against it.”
Philippe Berterottière, chairman and CEO of GTT, declared: “We are convinced that our commercial practices comply with the Korean competition rules.”
The more than $10m Korean yards have to pay GTT for each LNG carrier they build forced them to develop their own containment system. The KC-1 LNG tanks, which have been installed on a few ships over the past two years, were developed by Korea Gas Corp, Samsung Heavy Industries, Hyundai Heavy Industries and Daewoo Shipbuilding & Marine Engineering.