[1] Requirements for the second person who voluntarily provided evidence necessary to prove an unfair collaborative act as a person who cooperates in an investigation by the Fair Trade Commission after commencing the investigation under Article 35(1)3(a) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act

[2] Requirements for becoming the first investigative partner under Article 35(1) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act

[1] According to the language and contents of Article 22-2(1)2 and (4) of the Monopoly Regulation and Fair Trade Act, Article 35(1)3(a), (b), and (c) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act, “the second person who alone provided evidence necessary to prove an unfair collaborative act after the commencement of an investigation by the Fair Trade Commission” shall be “the first person who has independently provided evidence to prove an unfair collaborative act” in order to be subject to mitigation. Such duty of good faith shall take place from the time when the voluntary declaration or investigation commences in principle until the completion of the investigation. However, it is reasonable to view that the above duty of good faith takes place from the time when the voluntary declaration or investigation commences, as well as from the time when the voluntary reporter or the investigator has fully stated the fact related to the violation and has to submit relevant materials. In this regard, even if voluntary declaration, cooperation or investigation of evidence related to the act of destruction of evidence, etc. was conducted before the commencement of investigation or investigation into evidence, such duty of voluntary declaration or investigation may only affect the voluntary declaration or investigation.

[2] In order to become a first-class investigative partner under Article 35(1) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act (hereinafter “Enforcement Decree of the Fair Trade Act”), the Fair Trade Commission should have cooperated in an investigation in a state that it did not obtain information on the unfair collaborative act or has failed to obtain sufficient evidence necessary to substantiate the unfair collaborative act, and must meet all the requirements for reduction and exemption, such as having stated all the facts related to the unfair collaborative act and having faithfully cooperate until the completion of the investigation by submitting relevant materials (Article 35(1)2(a), (b), and (c) of the Enforcement Decree of the Fair Trade Act).

[1] Article 22-2(1)2 and (4) of the Monopoly Regulation and Fair Trade Act, Article 35(1)1(c), 3(a), and (b) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act / [2] Article 35(1)1(c), 2(a), and (b) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act

Seoul High Court Decision 201Na1448 delivered on May 2, 2012

Fair Trade Commission (Attorney Park Si-hwan et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2015Nu42529 decided June 17, 2016

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

The grounds of appeal are examined.

1. Whether it is unlawful that a failure to reduce or exempt a person engaged in investigation cooperation with the second priority is illegal (ground of appeal Nos. 1, 2, and 4)

A. Article 22-2(1)2 of the Monopoly Regulation and Fair Trade Act (hereinafter “Fair Trade Act”) provides that a penalty surcharge may be mitigated or exempted for a person who cooperates in an investigation by means of the provision of evidence, etc. (Article 22-2(1)2); and Article 22-2(4) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act (hereinafter “Enforcement Decree of the Fair Trade Act”) provides that a person who cooperates in an investigation after the commencement of the investigation by the Fair Trade Commission and who independently provides evidence necessary to substantiate the unfair collaborative act shall be mitigated by 50/100 of the penalty surcharge if the second person satisfies all the requirements, such as “the fact related to the unfair collaborative act” and “the submission of relevant materials, etc., has faithfully cooperated until the completion of the investigation” (Article 35(1)3(a) and (b)1(c) of the Enforcement Decree of the Fair Trade Act).

B. According to the language and text of the relevant Act and subordinate statutes, “the second person who, after commencement of an investigation by the Fair Trade Commission, alone provided evidence necessary to prove an unfair collaborative act” shall cooperate with the Fair Trade Commission until the completion of an investigation by stating all the facts related to the unfair collaborative act, submitting the relevant materials, etc. In principle, the duty of good faith cooperation shall take place at the time of voluntary report or investigation. However, the above duty of good faith cooperation shall be based on the premise that the voluntary reporter or the investigative partner should state all the facts related to the violation and submit relevant materials. In this regard, even if the act of destruction of evidence, etc. related to the violation of the voluntary report or investigation partner was conducted before the commencement of investigation, the act of destruction of evidence affects the contents of the report or investigation cooperation to the Fair Trade Commission, and has no choice but to affect the quality of the voluntary report or investigation cooperation. Therefore, even if the act of destruction of evidence, etc. was conducted before voluntary report or investigation cooperation, if it is insufficient at the time of commencement of investigation or investigation itself, it can be evaluated that voluntary report or investigation itself has failed.

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

(1) On April 9, 2012, the date of the Defendant’s on-site investigation, Nonparty 1’s official Nonparty 1, upon receipt of instructions, deleted his computer format in which data related to the instant collaborative act were stored.

(2) After the Defendant’s on-site investigation, Nonparty 2, who was an officer of the Plaintiff, exchanged Nonparty 3, who participated in the collaborative act, or information on which the Defendant secured certain materials related to the collaborative act from each business entity through the on-site investigation.

(3) On May 18, 2012, the Plaintiff filed an application for voluntary report in the first order, and subsequently, the Plaintiff filed an application for voluntary report in the second order on May 18, 2012.

D. Examining these circumstances in light of the legal principles as seen earlier, the Plaintiff’s employee’s act of destroying evidence, etc. relating to the collaborative act was conducted at the time when it is inevitable to specifically consider whether to cooperate in the investigation within the near future. Furthermore, the Plaintiff’s voluntary report was actually made at the close time. Furthermore, it may be deemed that the Plaintiff voluntarily filed a voluntary report and submitted insufficient evidence due to the destruction of evidence, etc., and accordingly, the Plaintiff’s act of voluntary report or investigation cooperation can be deemed to be in good faith. Therefore, it is difficult to deem that the Plaintiff faithfully cooperates until the completion of the investigation, such as the Plaintiff’s statement of

E. Although the reasoning of the lower court on this part was somewhat inappropriate, the conclusion that rejected the Plaintiff’s assertion is justifiable, and contrary to what is alleged in the grounds of appeal, there were no errors by misapprehending the legal doctrine on the violation of the duty of good faith cooperation in relation

2. Whether it is unlawful to recognize the status of the investigator for investigation in the first place (ground of appeal No. 3)

A. To become a first-class investigator for investigation, the Fair Trade Commission should have cooperated in investigation without obtaining information on the unfair collaborative act or without obtaining sufficient evidence necessary to substantiate that the collaborative act is an unfair collaborative act, and must meet all the requirements for reduction and exemption, such as where the Fair Trade Commission has stated all the facts related to the unfair collaborative act and has faithfully cooperated until the investigation is completed (Article 35(1)2(a) and (b) and 1(c) of the Enforcement Decree of the Fair Trade Act).

B. The lower court determined that the Plaintiff did not constitute the first-class investigator for investigation, on the ground that the Fair Trade Commission had sufficiently secured evidence necessary to prove the instant collaborative act through a field investigation at the time of the Plaintiff’s application for reduction and exemption and the submission of evidence of Koreanation, not only did the Plaintiff have faithfully cooperated in the investigation.

C. Examining the records in light of the relevant legal principles, the above determination by the court below is just, and there is no error by misapprehending the legal principles as to the requirements of the first-class investigator.

3. Conclusion

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Park Sang-ok (Presiding Justice)