2015Do5396 Violation of Monopoly Regulation and Fair Trade Act

1. A;

2. B stock company:

Defendants

Law Firm D, Attorneys E, Y, Z, AA (for defendant A),

Incheon District Court Decision 2014No4087 Decided April 1, 2015

December 23, 2015

The part of the judgment below against Defendant A is reversed, and that part of the case is remanded to the Incheon District Court Panel Division.

Defendant B’s appeal is dismissed.

The grounds of appeal are examined.

1. As to Defendant A’s ground of appeal

A. According to the reasoning of the lower judgment, the lower court found facts as indicated in its reasoning based on the evidence adopted, and found Defendant A guilty of the facts charged in this case on the ground that Defendant A participated in the unfair collaborative act from around April 2, 2008, and each of the above collaborative acts can be viewed as a continuing one act in light of the purpose, method, etc. of the crime, so long as Defendant A did not express or impliedly express intent to withdraw, Defendant A participated in the collaborative act until March 25, 2009, which is the final collaborative date of the relevant collaborative act.

B. However, we cannot accept the above judgment of the court below for the following reasons.

(1) Article 19(1) of the Monopoly Regulation and Fair Trade Act (hereinafter “the Act”) provides that “no enterpriser shall agree with any other enterpriser to jointly engage in any of the following acts that unfairly restrict competition (hereinafter “unfair collaborative act”) or allow any other enterpriser to engage in such act.” Article 19(1)9 of the Act provides that prohibited anti-competitive act such as “the act of determining, maintaining or changing the price” (Article 1), “the transaction terms and conditions of goods or services, or the act of determining the payment terms and conditions for the 7th price or the price payment” (Article 19(1)9 of the Act provides that “any person who has committed an unfair collaborative act in violation of Article 19(1) or who has had another enterpriser conduct such act,” and Article 66(1)9 of the Act provides that “any person who has committed an unfair collaborative act in violation of Article 19(1)9 of the Act shall be punished.” Thus, a violation of Article 66(1)9 of the Act does not practically require an agreement with another enterpriser to engage in such act.

On the other hand, the facts charged in a criminal trial should be proved by the prosecutor, and the judge should be convicted with evidence of probative value, which leads to the conviction that the facts charged are true beyond a reasonable doubt, so there is no such evidence.

Even if the defendant is suspected of guilty, the interest of the defendant should be determined (see, e.g., Supreme Court Decision 2006Do9042, Mar. 15, 2007).

Therefore, since it is difficult to secure direct evidence due to the nature of the above act, even in a case where it is inevitable to prove indirect facts or circumstantial facts and to take the method of proving such criminal act, the degree of proof requires a judge to provide strict proof to the extent that there is no reasonable doubt (see, e.g., Supreme Court Decisions 2006Do6625, May 5, 2008; 2006Do6625, supra).

(2) According to the reasoning of the lower judgment and the evidence duly admitted by the lower court, the following facts and circumstances are revealed.

(A) The Defendant, from September 1990 to September 200, had been qualified to participate in the purchase of underwater pumps conducted by the Public Procurement Service only after around 2008 while running the business of manufacturing, supplying, and installing the underwater pumps with the trade name of “T (T).”

(B) On April 2, 2008, T participated for the first time in the bidding process for underwater pumps, which was conducted by the Public Procurement Service (AFFFF) and participated in the bidding. At the same time, T was selected as a successful bidder by open lottery, with the amount of bid at KRW 1.3 million, together with the Dae-gu Co., Ltd., which participated in the bidding (hereinafter referred to as the “SF”), and T was a purchase contract with the Public Procurement Service on April 7, 2008 and KRW 1.3 million which was not selected as a successful bidder. After the Defendant participated in the bidding procedure on July 18, 2008, the Defendant paid KRW 270,000 to the Japanese Industrial Machinery Co., Ltd. (hereinafter referred to as the “Japan Machinery”).

(C) On May 23, 2008, T participated in the tendering procedure for the purchase of underwater storage pumps conducted by the Public Procurement Service, and participated in the bidding, but failed to be selected as a successful bidder at a bid price exceeding the estimated price, and the primary machinery participating in the bidding was selected as a successful bidder. On May 29, 2008, T concluded a purchase contract for the procurement commodities with the Public Procurement Service at KRW 7,2380,000.

(D) On December 26, 2008, T participated in the tendering procedure for the distribution line project in the Leepo-gun District, which was conducted by the Public Procurement Service, and participated in the bidding, but failed to be selected as a successful bidder at a bid price in excess of the estimated price, and MIM corporation (hereinafter referred to as "MA"), which participated in the bidding, was selected as a successful bidder, and MA entered into a contract for the purchase of procurement commodities with the Public Procurement Service on December 29, 208 and KRW 320 million.

(E) On January 8, 2014, on the grounds that companies manufacturing, supplying, and installing underwater pumps, including the Defendant, engaged in collusion (hereinafter “instant collusion”) in the process of underwater pumps pressure inspections executed by the Public Procurement Service, the Fair Trade Commission imposed corrective orders and penalty surcharges on 20 business operators among the business operators participating in collusion, and decided to file a complaint against 17 business operators with the public prosecutor, and the prosecutor filed the instant prosecution after investigation in accordance with the above accusation.

(f) However, even if the parties involved in the instant collusion were to make a statement in the process of being investigated by the Fair Trade Commission, there is no statement that the defendant or T employee, as the defendant or T employee, participated in the bidding at 0 on April 1, 2008 and May 20, 2008 in each Seoul Yeongdeungpo-gu, Seoul, and 0 on May 20, 2008.

(G) The contents of the unfair collaborative act agreement that the defendant participated in the bidding are so-called "the method of allocating profits" to the effect that the successful bidder who can produce the lowest unit price for the main underwater pumps at 500 meters', and the actual bid price shall be determined in advance, and that the successful bidder shall distribute the amount of the successful bidder's price to the enterprises participating in the agreement, excluding the manufacturing cost, from the successful bidder's successful bid price, the successful bidder, the successful bid price and the distribution of profits, etc., which the public procurement agency ordered after prior agreement was reached. If the defendant participated in the bidding procedure on April 2, 2008, it is difficult to explain that the defendant and the public tender price were reflected in the same bid price.

(H) In the tendering procedure on April 2, 2008, the Defendant was selected as a successful bidder and delivered KRW 2.7 million to the first machinery that was jointly selected as a successful bidder but failed to be selected as a successful tenderer. However, the Defendant consistently demanded that there be different amounts of money in order to continue a bid in advance from other enterprisers who have previously participated in the underwater pumps tender, and provided money in order to avoid being excluded from being excluded from the industry. Moreover, the Defendant’s delivery of money to other enterprisers is difficult to view that there was a concern that the Defendant might cause a concern that the fair enforcement of competition related to the tender or the implementation of the aptitude limitation is possible, since the Defendant participated in the tendering procedure on April 2, 2008 and the Defendant already selected as a successful tenderer.

(i) In the bidding procedure on April 2, 2008, there is no specific evidence that the Defendant participated in the other bidding procedure after being selected as a successful bidder, but did not select as a successful tenderer. On May 23, 2008, the first machinery selected as a successful tenderer in the bidding procedure was disposed of by offsetting the Defendant’s profit distribution from the distribution of the profits that the Defendant would receive from the Defendant. It is difficult to easily believe that there was no specific statement on the amount of the entire profit acquired from the successful tenderer in the bidding procedure, the amount of the profit distribution to the Defendant, and whether the profit distribution to the other participants except the first machinery in the bidding procedure on April 2, 2008, with regard to the tender on December 26, 2008. In addition, it is insufficient to recognize the Defendant’s participation in the bidding procedure on December 26, 2008, which is a person in charge of H Co., Ltd., one of the participating enterprises, and received 60 million won from the third enterprises except the remaining amount of the bid.

(3) Examining these facts and circumstances in light of the legal principles as seen earlier, it is difficult to view that the evidence submitted by the prosecutor alone is sufficient to prove that the Defendant was involved in the unfair collaborative act, such as the instant facts charged, to the extent that there is no reasonable doubt.

Nevertheless, the lower court, based on its stated reasoning, found the Defendant involved in the collaborative act from April 2, 2008 to March 25, 2009, which was the final collaborative act date of the collaborative act by taking part in the collaborative act, and convicted all of the facts charged in the instant case guilty. In so doing, the lower court erred by exceeding the bounds of the principle of free evaluation of evidence in violation of logical and empirical rules, or by failing to exhaust all necessary deliberations, thereby adversely affecting the conclusion of the judgment.

2. As to Defendant B corporation

Examining the reasoning of the lower judgment in light of the evidence duly admitted by the first instance court, the lower court was justifiable in maintaining the first instance judgment convicting Defendant B Co., Ltd. of the facts charged on its grounds as stated in its reasoning, and contrary to what is alleged in the grounds of appeal, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence in violation

3. Conclusion

Therefore, the part of the lower judgment against Defendant A is reversed, and that part of the case is remanded to the lower court for further proceedings consistent with this Opinion. Defendant B’s appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

The presiding judge shall keep the record of the Justice

Justices Kim Yong-deok

Chief Justice Park Jong-young

Justices Kim Jae-han