1. Case summary and key issue

A. According to the reasoning of the lower judgment, the following circumstances are revealed.

1) In around 1962, the Plaintiff is not only a business operators’ organization as stipulated in Article 2 subparag. 4 of the Monopoly Regulation and Fair Trade Act (hereinafter “Fair Trade Act”) but also a business operators who engage in the manufacturing and sales of the same system, such as a new Seoul Information and Communications, Oral e-mail, etc., established pursuant to the Small and Medium Enterprise Cooperatives Act (hereinafter “Fair Trade Act”), a business operators’ organization as defined in Article 2 subparag. 4 of the Monopoly Regulation and Fair Trade Act (hereinafter “Fair Trade Act”) but also a business operators who engage in the business of manufacturing and selling the same system, such as multiple-use file, data circulation device, and telephone exchange network connection device.

2) From February 2009 to January 201, 2015, the Plaintiff received the “public notice of request for public purchase” (hereinafter “public notice of request for support”) stating the name of the demanding agency, name of the building, budget amount, etc. from the member business entity that has conducted prior business activities against the local government, the State, etc., which is an end-user institution of the same system, from February 2009 to January 201, the Plaintiff sent the bid price or the bid price to the member business entity so that the bid can be awarded in the pertinent bidding, and notified the other member business entity of the bid price or the bid price (hereinafter “instant act”).

3) On January 3, 2019, the Defendant imposed on the Plaintiff a corrective order as set forth in Article 26(1)1 and Article 19(1)8 of the Fair Trade Act (attached Form 1) and a penalty surcharge payment order as set forth in paragraph (3) (hereinafter “instant penalty surcharge payment order”) on the ground that the Plaintiff’s instant act was in violation of Article 26(1)1 and Article 19(1)8 of the Fair Trade Act.

4) Here, the Defendant calculated the Plaintiff’s annual budget amount in 2015, which is the year when the violation ends pursuant to the Notice on the Detailed Criteria for Imposition of Penalty Surcharges (hereinafter “Public Notice of Penalty Surcharges”) on September 2, 201, based on the Plaintiff’s annual budget amount for the year when the violation ends, and applied 40% by deeming the instant act as a serious violation, and subsequently, 50% as the first adjustment was added on the ground that the period of the instant act exceeds three years, but the Defendant decided to impose the penalty surcharge amounting to KRW 500,000,000,000,000,

B. The key issue of the instant case is: (a) the fact-finding of the instant act, whether there was a violation of the rules of evidence, whether the instant act may be deemed a result of the Plaintiff’s decision-making, whether the instant act constitutes “justifiable act” as stipulated in Article 58 of the Fair Trade Act; and (b) the meaning of “annual budget amount” as the basis for calculating penalty surcharges imposed on the Defendant’s business association in relation to the Defendant’s grounds of appeal; and (c) whether the instant penalty surcharge order deviates from or abused discretion.

2. As to the Plaintiff’s grounds of incidental appeal

A. Whether the Plaintiff’s ground of incidental appeal is unlawful, such as incomplete hearing (the first ground of incidental appeal of the Plaintiff)

This part of the allegation is disputing the judgment of the court below that recognized the act of this case, and it is merely an error of the selection of evidence and the judgment on the value of evidence belonging to the free trial of the fact-finding court, and thus cannot be a legitimate ground for appeal. Furthermore, even if examining the reasoning of the judgment below in light of the records, the above judgment of the court below did not err by exceeding the bounds of

B. Whether an enterprisers' organization makes a decision (the ground of incidental appeal No. 2 of the Plaintiff)

The lower court determined that: (a) Nonparty 1 and Nonparty 2, the person in charge of Nonparty 1 and Nonparty 2 in the Plaintiff’s business department, presented a bidding rate, etc. to the organizing business entity, and did not simply shared general matters related to bidding or encourage the organizing business entity to participate in bidding; and (b) the Plaintiff, the business entity organization, determined that the Plaintiff’s act of deciding successful bidder among the organizing business entities participating in a specific bidding on the same device, or determined matters such as the bidding price, bidding price, bidding rate, etc. of individual constituent business entities.

Examining the reasoning of the lower judgment in light of relevant statutes and records, the lower judgment did not err by misapprehending the legal doctrine on the decision-making of an enterprisers’ organization under the Fair Trade Act, contrary to what is alleged

C. Whether the Plaintiff’s act constitutes justifiable grounds of incidental appeal (No. 3)

The lower court determined that it is difficult to view the instant act as constituting “justifiable conduct conducted in accordance with the law or an order issued under the law” under Article 58 of the Fair Trade Act on the ground that the Plaintiff’s act in this case was detrimental to the free competition of the limited market through the instant act, even though public purchase of the same device was conducted through the competition system among small and medium enterprises pursuant to the Act on the Promotion of Purchase of Small and Medium Enterprise Products and the Development of Market Support

Examining the reasoning of the lower judgment in light of relevant statutes and records, the lower judgment did not err by misapprehending the legal doctrine on justifiable acts under Article 58 of the Fair Trade Act, contrary to what is alleged in the grounds of incidental

3. The meaning of “annual budget amount” as the basis for imposing penalty surcharges on the trade association (Defendant’s ground of appeal No. 1)

(a) Relevant statutes;

Article 28(1) of the Fair Trade Act provides that the Fair Trade Commission may impose a penalty surcharge not exceeding KRW 500 million on an enterprisers' organization that has committed a prohibited act under Article 26. Article 55-3(5) of the Monopoly Regulation and Fair Trade Act provides that Article 61(1) and [Attachment 2] subparagraph 2(a)3(b) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act (hereinafter referred to as the "Enforcement Decree of the Fair Trade Act"), upon delegation of Article 55-3(5) of the Fair Trade Act, shall impose a penalty surcharge by multiplying the annual budget of the enterprisers' organization for the year in which the date on which the violation ends by the base rate

B. The judgment of the court below

The court below held that if the goods or services dealt with individually even if the category of member enterprisers are identical, if the enterprisers' organization committed a violation of the Fair Trade Act with respect to specific goods or services handled only by some member enterprisers, the "annual budget amount" which serves as the basis for the calculation of the penalty shall be based on the budget amount related to the member enterprisers dealing with specific goods or services in question, and that if a penalty surcharge is to be calculated based on the total annual budget amount of the enterprisers' organization, it may result in the member enterprisers unrelated to the act of the enterprisers' organization's organization's partial transfer of liability due to the mere reason that they are members of the member enterprisers' organization, which is against the principle of self-responsibility.

C. Judgment of the Supreme Court

However, in light of the above contents, stay, text, etc. of the Fair Trade Act and the Enforcement Decree, “annual budget amount” which serves as the basis for calculating penalty surcharges against an enterprisers’ organization is not limited to the amount of the annual budget of the pertinent enterprisers’ organization related to the constituent enterprisers dealing with goods or services in which a violation occurred, but it is reasonable to view that the pertinent enterprisers’ organization’s total annual budget amount for the year in which the violation ends falls.

1) The Enforcement Decree of the Fair Trade Act clearly distinguishes the amount of sales from April 1, 1999 to the present, which began to stipulate the criteria for imposition of penalty surcharges as the attached Table, from the date of the enactment of the attached Table, to the present, from the business operators’ organization as the criteria for calculation of penalty surcharges, and from the business operators’ organization as the basis for calculation of penalty surcharges, the amount of annual budget, which is the basis for calculation of penalty surcharges, to the amount of sales of goods

2) Article 22 of the Fair Trade Act provides that an enterpriser who has engaged in unfair collaborative acts shall, in principle, impose a penalty surcharge on the basis of “the sales” and the Enforcement Decree thereof shall be based on the term “related sales”. Unlike Article 28 of the Fair Trade Act, Article 28 of the Fair Trade Act provides that an enterpriser’s organization shall impose a penalty surcharge within the scope of KRW 500 million, and the term “annual budget amount” is based on

3) Furthermore, even according to the language and text of subparagraph 2(a) Item 2(b) of attached Table 2 of the Enforcement Decree of the Fair Trade Act, the criteria for imposing penalty surcharges on a trade association are stipulated as the annual budget amount for the year in which the date of completion of the violation falls. However, as in the judgment of the court below, if the basis for calculating penalty surcharges is considered to be the same as the annual budget amount for the year in which the violation occurred, rather than the annual budget amount for the year in which the violation occurred, if the basis for calculating penalty surcharges is considered to be identical to

4) Meanwhile, since the subject of the penalty surcharge due to the instant act is the Plaintiff, a business association that is the person in charge of the instant act, it is difficult to deem that it violates the principle of self-responsibility on the basis of the total annual budget amount of the Plaintiff, who is the pertinent

5) If the scope of imposition of a penalty surcharge is determined on the basis of whether a member company in an enterprisers' organization provides goods or services for which an unfair collaborative act occurred, whether a member company falls under the category of business in which an unfair collaborative act is committed, and whether the share of monthly membership fees is certain, it would result in uncertainty in the scope of imposition of a penalty surcharge rather than in securing concrete feasibility for imposition of the penalty surcharge. Rather, it may secure concrete feasibility for imposition of the penalty surcharge through the standard rate for imposition in accordance with the Enforcement Decree of the Fair Trade Act [Attachment 2] and the notice on the basis thereof, and the first and

D. Nevertheless, the lower court determined that the “annual budget amount” which serves as the basis for calculating penalty surcharges against an enterprisers’ organization limited to the amount of the budget related to the member enterprisers dealing with specific goods or services. In so determining, the lower court erred by misapprehending the legal doctrine on the annual budget amount, which is the basis for calculating penalty surcharges against an enterprisers’ organization

4. Conclusion

Therefore, without further proceeding to decide on the remaining grounds of appeal by the defendant, the part against the defendant among the judgment below is reversed, and that part of the case is remanded to the court below for further proceedings consistent with this Opinion. The plaintiff's supplementary appeal is dismissed. It is so decided as per Disposition by the assent of all

Justices Kwon Soon-il (Presiding Justice)