What specific competition concerns led South Korea's FTC to impose conditions on the Lotte-HD Hyundai Daesan merger?

The FTC concluded the merger posed a risk of substantially restricting competition in the domestic low-density polyethylene (LDPE) and ethylene vinyl acetate (EVA) markets, noting the number of domestic LDPE and EVA competitors would fall from four to three, with the merged entity’s combined sales volume shares reaching 82% for LDPE and 95% for EVA; domestic buyers are mainly small and medium-sized plastics processors with limited alternative supply options, and competitors’ operating rates are already near 95–100%.

What are the key behavioral remedies imposed by the FTC on the merged entity?

The FTC mandated five-year remedies: (1) domestic LDPE and EVA price changes must be tied to export price movements—domestic increases cannot exceed export increases when exports rise or stay flat, and domestic reductions must equal or exceed export reductions when exports fall; (2) continued supply of all pre-merger LDPE and EVA grades to domestic customers at fair, reasonable, and non-discriminatory terms; (3) prohibition of exchanging commercially sensitive information (prices, volumes, costs, inventories) among HD Hyundai Chemical, Lotte Chemical, and HD Hyundai Oilbank; (4) no overlapping executive or employee positions between HD Hyundai Chemical and Lotte Chemical or affiliates, including a one-year ban for transferred employees from working in LDPE or EVA operations upon returning to Lotte Chemical.

South Korea Conditionally Approves Lotte-HD Hyundai Daesan Petrochemical Merger

Aug 20, 2026

South Korea's FTC conditionally approved Lotte Chemical and HD Hyundai Chemical's Daesan asset merger, imposing price and supply restrictions to address competition concerns in LDPE and EVA markets.

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