2017Guhap67254 Disposition of restrictions on participation in national research and development projects by Ministry of Culture, Sports and Tourism

Revocation

A Co., Ltd. (formerly: B)

The Minister of Culture, Sports and Tourism

December 15, 2017

February 2, 2018

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

The defendant's disposition of restricting participation in national research and development projects by the Ministry of Culture, Sports and Tourism against the plaintiff on March 22, 2016 (from March 23, 2016 to March 22, 202) shall be revoked.

1. Details of the disposition;

A. On July 1, 2012, the Plaintiff (the trade name before the change was made on March 31, 2017 referred to as “B”) entered into an agreement on the development of the sports industry (hereinafter referred to as the “instant agreement”) with the Seoul Olympic Sports Promotion Foundation (hereinafter referred to as the “Korea Olympic Sports Promotion Foundation”) on which the Plaintiff et al. were to perform the following tasks with government subsidies, etc. as financial resources.

A person shall be appointed.

B. The Plaintiff, as a general managing research institute and a specific managing research institute at the time, was paid a total of KRW 1.53 billion in research and development expenses in the course of performing the pertinent task for three years and three months from July 1, 2012 to September 30, 2015, with G as the managing research institute at the time, as the managing research institute at the time, and G as the managing research institute at the time, for three years and three months from July 1, 2012. G was found guilty of KRW 923,232,73 of research and development expenses by deceiving the Corporation as if he/she were to be used as trade costs, such as labor costs and parts related to research and development while performing the instant project at the time, and on May 19, 2016, he/she was found guilty (Seoul Central District Court Decision 2015Da1130) by the said court (hereinafter referred to as “the instant criminal judgment”).

D. Accordingly, on March 23, 2017, the Defendant: (a) used the Plaintiff’s total research and development costs of KRW 923,232,733 exceeding KRW 1.50 million for any purpose other than 30 million; and (b) illegally conducted research and development by falsely preparing a false report on the use of project costs in the process; (c) rendered the Plaintiff a disposition of restricting participation in national research and development projects by applying Article 11-2(1)5, 7, and (9) of the former Framework Act on Science and Technology (amended by Act No. 13578, Dec. 22, 2015; hereinafter “Framework Act”); (d) Article 27(1)5(c), 7, 27(1)7, 28, and 36 of the former Regulations on the Management, etc. of National Research and Development Projects (amended by Presidential Decree No. 27369, Jul. 22, 2016; hereinafter “Research Management Regulations”).

[Ground of recognition] Unsatisfy, Gap evidence Nos. 1, 2, and 6, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) Defects in the grounds for disposition

A) Research and development costs of KRW 923,232,73 used for any other purpose (i.e., the total research and development costs of KRW 4.41,3920,000 for the instant project (i.e., the government subsidy of KRW 3 billion + KRW 1.41,3920,000 for private financing) is merely about 20% of the research and development management rules that serve as the basis for the instant disposition, only a disposition of restriction on participation within four years can be made (hereinafter referred to as “1-1 assertion”).

B) On April 15, 2016, the Plaintiff was finally assessed by the final evaluation committee of the instant project for the development of sports technology by the final evaluation committee for the development of sports technology. Therefore, the Plaintiff cannot be deemed to have performed research and development by fraud or other improper means (hereinafter “1-2 assertion”).

2) A deviation from or abuse of discretionary power

As the Defendant did not consider the following grounds for mitigation in rendering the instant disposition, the instant disposition was in violation of law that deviates from and abused discretion.

A) In accordance with the provisions on research and development management, where the relevant amount has already been recovered from the account for research and development expenses when the head of a central administrative agency discovered the use for any purpose other than the original purpose, the period of restriction on participation pursuant to the relevant frequency may be reduced to at least one year. Since the Plaintiff deposited KRW 923,232,73 of the research and development expenses used for any purpose other than the original purpose on April 22, 2016, which was six months before the date when the Defendant discovered the use of the Plaintiff’s research and development expenses from October 17, 2016, which was six months before the date when the Plaintiff discovered the use of the research and development funds by the original deposit, thereby the research and development expenses used for the purpose other

B) In addition, since the project of this case was assessed as successful, such circumstance is an element to be considered in the determination of the disposition of this case (hereinafter “2-2 argument”).

B. Relevant statutes

The entries in the attached Table-related statutes shall be as follows.

C. Determination

1) Determination as to the assertion of defects in the grounds for disposition

A) As to the 1-1 argument

(1) Article 11-2(1)5 and 7 of the Framework Act on Science and Technology provides that "the head of a central administrative agency may restrict the participation of a national research and development project under his/her jurisdiction and recover all or part of the project cost already contributed or subsidized if the research and development project is used for any purpose other than the intended purpose, or is conducted by fraudulent or other illegal means for any company, etc. participating in the national research and development project under his/her jurisdiction," and Article 11-2(1)5 and 7 of the Framework Act on Science and Technology provides that "the period of restriction on participation by reason of restriction on participation, detailed criteria for recovery

According to the delegation above, Article 27 (1) 5 (main sentence) of the Research and Development Management Regulations provides that the period of restriction on participation in cases where research and development costs are used for any purpose other than the original purpose, the period of restriction on participation in cases where the amount used for any purpose other than the original purpose is less than 20 percent (a) or less than three years if the amount used for the purpose other than the original purpose is more than 20 percent (b) or less than 20 percent but not more than 30 percent (c) or less than five years if the amount exceeds 330 percent (c) and such research and development

Such sanctions are prepared to the effect that the degree of disposal is different according to the utilization level of research and development expenses allocated to the relevant research institute. This is a limitation logic on self-determination right, which functions as the basis for the burden of responsibility, and simultaneously serves as the basis for the self-determination right, and the scope of the responsibility is limited to the result of self-determination or a part in relation thereto.

Therefore, in applying the above sanctions, the proportion of research and development expenses used for any purpose other than the original research and development expenses allocated to the relevant managing research institute shall be followed.

(2) In full view of the purport of the entire pleadings, the following facts are recognized in each entry of Gap evidence Nos. 6, Eul evidence Nos. 1 to 9 (including branch numbers, if any).

(A) The total research and development costs for the instant project are KRW 4.41 billion (=3 billion government subsidies + KRW 1.413920,000). The details thereof are as follows.

A person shall be appointed.

A person shall be appointed.

(B) In the event a research and development task is classified into a general task and a specific task, an institution managing the general task is called a "general research institute" and "specific research institute" (the management guidelines for the sports technology development project). The Plaintiff is a general research institute and an institution leading the specific task. The Plaintiff entered into an agreement on the instant project with the Corporation as a specific research institute. C&P Co., Ltd. is a three specific research institute. Each specific research institute is responsible for reporting the use, management, and usage of research and development costs (Article 12 of the Regulations on the Research and Development of the Ministry of Culture, Sports and Tourism). Each specific research institute, including the Plaintiff, independently manages the development project cost separately organized according to the specific task entrusted to each of the main research institutes, and also independently submits the report on the settlement of project costs (=620,000,000,000,000 won +620,000,000 won +2,270,000 won). The Plaintiff’s research and development costs related to the instant project are as follows.

(unit: ,000 won)

A person shall be appointed.

A person shall be appointed.

(C) During the instant criminal judgment, the Plaintiff used KRW 923,232,733 as government subsidies received to carry out the first detailed tasks during the instant business period (2012 to 2015) and was convicted of having been convicted of committing a crime that acquired the above KRW 923,232,73 in the instant criminal judgment.

(3) According to the above facts, since the Plaintiff’s ratio of the amount used out of the research and development funds to the amount used out of the Plaintiff’s purpose is about 39.45% (=923,232,733 won/2,39,890,000 won), it cannot be deemed that there is a defect in the instant disposition on the premise that the amount used out of the purpose exceeds 30% of the research and development expenses (the Defendant stated 60.3% of the amount used out of the national subsidy, which is a part of the research and development funds, as the use ratio for the purpose other than the research and development expenses, as seen earlier, is included in the research and development expenses, and thus, it is an erroneous calculation. However, as long as the ratio of use out of the properly calculated research and development funds exceeds 30%, it cannot be deemed that there is any defect in the instant disposition on such premise).

Therefore, we cannot accept the plaintiff's above assertion.

B) As to the 1-2 argument

(1) Article 11-2(1)7 of the Framework Act on Science and Technology refers to the time when the managing research institute uses false or other unlawful means in the course of performing research and development projects. Thus, the success of research and development is not directly related to the application of the aforementioned provision. In addition, Article 11-2(1) of the Framework Act on Science and Technology is determined as a research and development task suspended or failed as a result of an evaluation conducted by a central administrative agency due to extremely poor outcomes of research and development (Article 11-2(1) of the Framework Act on Science and Technology) and where the relevant research and development project failed without justifiable grounds (Article 11-2(3).

Therefore, Article 11-2(1)7 of the Framework Act on Science and Technology can be applied to cases where false or other unlawful methods are used during the course of research and development regardless of success in research and development projects, and the above subparagraph 7 can only be applied to cases where research and development projects have failed.

(2) In addition to the statements in Gap evidence Nos. 2 and Eul evidence Nos. 1, the main research institute in the instant agreement shall use the research and development funds subsidized by the Corporation only for the purpose of business specified in the research and development plan, and shall not be used for any other purposes. The annual settlement from the date of completion of the technology development project shall not be more than 15 days, the annual settlement shall be reported within one month, and the remainder of the research and development funds shall be returned, except for the amount actually used, and the remaining amount shall be returned. 2) Since the plaintiff violated the duties of the main research institute in the instant agreement as well as the report on the actual usage of research and development funds in order to conceal such facts, it is reasonable to view that the plaintiff conducted research and development by fraudulent or other illegal means.

Therefore, we cannot accept the Plaintiff’s assertion on a different premise.

2) Determination on the assertion of deviation or abuse of discretionary power

A) The proviso to Article 27(1)5 of the Regulations on the Management of Research and Development provides that even in cases where research and development expenses are used for any purpose other than their original purpose, if the head of a central administrative agency finds out any use of research and development expenses, the relevant amount may be reduced for at least one year if the relevant amount has already been restored to the account for the management and supervision of research and development expenses. Thus, the above provision on reduction or exemption cannot be applicable to cases where the said person can use the research and development expenses for any purpose other than their original purpose by returning them to the account for the relevant research and development expenses after the discovery of the use of the research and development expenses for any purpose other than their original purpose. In other words, the above provision on reduction or exemption shall not be applicable to cases where the said person can use the research and development funds for any purpose other than their original purpose at the time of using them to the relevant account for the temporary diversion of the relevant research and development expenses. Even if the research and development funds were used for any purpose other than their original purpose, he provided a incentive to recover the relevant research and development funds.

In addition to the statement in Gap evidence Nos. 5 and Eul evidence Nos. 12, the defendant is aware that before February 2016, the plaintiff had already been investigated by the prosecution due to the suspicion of defraudation of research and development costs related to the business of this case, and it was discovered that the plaintiff used the plaintiff's research and development costs for any other purpose. It was not found that the plaintiff did not recover the above KRW 923,232,733 to the relevant account at the time of disclosure. Thus, even if the plaintiff deposited the Corporation as a deposit on April 22, 2016 and deposited the research and development costs of 923,232,733 won for any other purpose, the above provision shall not apply.

We cannot accept the Plaintiff’s above assertion on a different premise.

B) Article 27(11) and [Attachment 5] 6 of the Regulations on the Management of Research and Development concerning the 2-2 argument provides that where research and development costs are used for any purpose other than the original purpose, they shall be recovered within the total amount of contributions for the pertinent year, but the head of the central administrative agency may reduce the amount of the project cost in consideration of the severity of the violation and the possibility of achieving the objectives of the research and development tasks. Therefore, the success of the research and development task seems to

On the other hand, the instant disposition contains restrictions on the participation in national research and development projects by putting “use of research and development expenses for purposes other than those of use and “performance of research and development projects by fraud or other improper means” as the grounds for disposition. In the event that the project is judged as failed, it constitutes separate grounds for disposition under Article 11-2(1)1 of the Framework Act on Science and Technology. Therefore, whether the instant project has been evaluated as successful as a result of the determination of the instant disposition does not necessarily mean

We cannot accept the Plaintiff’s above assertion on a different premise.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.

The presiding judge, the subordinate judge;

Judges Park Jong-dae

Judge Lee Ho-hoon

1) The plaintiff specified the date of disposition in the complaint as " March 23, 2016," but according to the evidence No. 1, the plaintiff sought revocation.

Since such restriction is deemed to have been issued on March 22, 2017, the date of such restriction shall be specified as above.

2) However, on April 22, 2016, G, which was under criminal trial, deposited 923,232,733 won by defraudation with the Corporation as a depositor on April 22, 2016, the amount of the above restitution disposition shall be the amount to be disposed of.

was considered to have been recovered.

3) The provision on the management, etc. of national research and development projects performed at the time of the instant disposition (amended by Presidential Decree No. 27369, Jul. 22, 2016)

Article 27(1) of the Presidential Decree provides that Article 27(1) shall apply, but Article 2 of the Addenda (Presidential Decree No. 27369, July 22, 2016) of the aforementioned provision provides that Article 27(1) shall apply.

According to the above, the amended provisions of Article 27(1) apply from the national research and development project to which the agreement is concluded after the implementation of the above provisions.

The above provisions shall not apply to the instant project for which the transfer agreement was concluded.