2024.07.15. The Fair Economy — Taihan Cable & Solution has directly refuted LS Cable & System's claims regarding allegations that it stole LS Cable & System's technology.
According to recent media reports, police on the 11th named Taihan Cable & Solution as a suspect on charges of violating the Unfair Competition Prevention and Trade Secret Protection Act and raided the company's headquarters in Seocho-gu, Seoul.
Earlier last month, police also raided Gajong General Architects, which designed LS Cable & System's cable plant, and Taihan's cable plant in Dangjin, South Chungcheong Province.
Taihan Cable & Solution had refrained from taking a specific stance on the ongoing investigation but said it was clarifying the facts in response to LS Cable & System's position statement, which it said was based on unverified speculation. The company rebutted LS Cable & System's claims point by point.
Taihan Cable & Solution emphasized that LS Cable & System's claim that the layout of a submarine cable factory constitutes core technology is not true.
"Cable products, which have a linear structure, undergo a manufacturing process that proceeds from the center (conductor) to the outside (insulation and outer sheath, etc.), and equipment is arranged taking this sequence into account," Taihan Cable & Solution said. "The same applies to submarine cable equipment. The layout is determined by considering production capacity, the shape and size of the factory site, the location of the pier, and other factors. Therefore, the layout of factory equipment cannot be considered core technology. For this reason, overseas factories not only allow competitors to tour their facilities but also disclose equipment arrangements on websites and elsewhere."
It also argued that plant layouts are not such core technical matters that they can be purchased from overseas equipment suppliers for a nominal fee, and therefore there is no reason to obtain a competitor's layout or drawings for the purpose of technology theft.
Taihan Cable & Solution stated that it has not stolen or used LS Cable & System's trade secrets.
Taihan said, "We built our plant with our own technology, accumulated through decades of cable manufacturing and research on submarine cables. We determined the final layout after dozens of internal reviews and studies considering the various conditions mentioned above, and built Plant 1 Phase 1 based on that. For Plant 2, we are reviewing layouts for various candidate sites, and after selecting the optimal site through this process, we plan to receive engineering services from M Company, Europe's largest cable equipment maker."
Taihan said Gajong Architects was selected fairly through a competitive bidding process.
Taihan said, "Among many design firms with plant design experience, we selected Gajong Architects through qualitative and quantitative evaluation. The claim that Taihan contacted Gajong first and requested design work several times is not true, and we do not know the contract amount of the competitor."
It added, "Gajong Architects is a firm that designs the space of factory buildings, and the submarine cable plant equipment was manufactured and installed by specialized companies. The number of companies in Korea that can produce submarine cable equipment is limited. Taihan has only given fair bidding opportunities to companies with cable equipment supply experience, and has never demanded the same equipment manufacturing and layout as LS Cable & System claims."
Taihan Cable & Solution raised its voice, calling for an end to excessive checks by a monopolist aimed at blocking other companies' market entry.
Taihan said, "The submarine cable market is one of the most promising sectors in the global power grid industry and an industry that should be fostered through public-private cooperation at the national level. If LS Cable & System, which holds a monopoly position in Korea, obstructs Taihan's market entry based on unverified claims, it will not only weaken national competitiveness in the submarine cable and offshore wind industries but also leave our cable market unprotected from overseas players such as China."
It added, "To prevent such a situation, Taihan will cooperate sincerely with the police investigation and actively explain the facts to prove that there is no basis for the allegations."
Taihan Cable & Solution said it aims to resolve the current situation quickly and push forward its submarine cable business and investments as planned to contribute to strengthening national competitiveness and energy security. It asked for understanding that specific details of the ongoing investigation could not be disclosed and requested competitors to refrain from excessive public opinion campaigns to prevent harm to stakeholders.
It also said, "If it is confirmed that there are no charges, we will take all possible civil and criminal measures."
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