2014Nu1613 Corrective order and revocation of penalty surcharge payment order

A

Fair Trade Commission

September 26, 2014

November 14, 2014

1. The plaintiff's claim is dismissed.

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

The Defendant’s corrective order and penalty surcharge payment order on January 8, 2014, as stated in the separate sheet, against the Plaintiff, shall be revoked.

1. Details of the disposition;

A. Status of the plaintiff, etc.

The plaintiff, Jinjin Electric Co., Ltd., Franchising Co., Ltd., new machines, gold industry Co., Ltd., Franchising Industries Co., Ltd., Shin Jin Heavy Industries Co., Ltd., Samjin Industries Co., Ltd., Ltd., Samsung Heavy Industries Co., Ltd., Ltd., Ltd., Ltd., Ltd., Large-Seng Industries Co., Ltd., Ltd., Large-Seng Industries Co., Ltd., Ltd., Ltd., Ltd., Ltd., Deng Chang Chang Changm Industries Co., Ltd., Ltd., Ltd., Ltd., Deng Changm Industries Co., Ltd., Ltd., D, D, and E (hereinafter referred to as the "Plaintiff, etc.") individually for the remaining enterprisers except the plaintiff.

(b) Bidding methods for underwater pumps and the Public Procurement Service;

pumps mean machinery which transport liquid or gaseous fluids through pipes or through pipes the fluids located in low pressure vessels, and underwater pumps are used in a state in which the mother and the pump are tightly in water.

The Public Procurement Service(PP) orders most of the underwater pumps (total amount) through a bid for purchase at the request of public institutions such as local governments or agricultural and fishing villages. However, most of the underwater pumps bidding will determine whether the price actually depends on whether or not the price is successful, because the annual operating time is less than 200 hours, and there is no significant difference in the energy efficiency cost.

C. The defendant's disposition

On January 8, 2014, the defendant issued a corrective order and a penalty surcharge payment order (hereinafter referred to as "disposition of this case") to the plaintiff on the ground that the following acts of the plaintiff et al. (hereinafter referred to as "the collaborative act of this case") constitute "the determination, maintenance, or modification of the price" under Article 19 (1) 1 of the Monopoly Regulation and Fair Trade Act (hereinafter referred to as the "Act"), "the act of restricting the quantity of goods or services supplied in the market" under subparagraph 3, and "an act of restricting the transaction area or transaction partner" under subparagraph 4 of the attached Table.

By February 22, 2005 to December 22, 2009, 5, and 24, the Plaintiff et al. participated in the bid for purchasing 100m or 1,800m or 1,800m or 100m or 1,00m or 1,00m or 1,00m or 1,00m or more, determined in advance the method of determining successful bidders and the principle of profit sharing, and selected the bid subject to agreement by identifying the order quantity of the public procurement agency, and decided the bid price of the successful bidders by having agreed to participate in the agreement among the companies with specific construction costs required under the bidding conditions in advance, and implemented it continuously.

[Judgment of the court below] The ground for recognition is without dispute, Gap evidence No. 1, and the ground for appeal

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The plaintiff asserts that the disposition of this case is unlawful and should be revoked for the following reasons.

1) Absence of agreement

Prior to April 2008, only Company A and B agreed to participate in the underwater pumps tender ordered by the Public Procurement Service (the Group B that has the results of the supply of the underwater pumps and the results of the supply of the underwater pumps at the same time) but only Company A and B actively participate in the tender (the small amount of the pump size in the large amount in the large amount in the large amount in the large amount) without any restriction on performance due to the depression and the subsidence of the pump market, and even if there is no restriction on performance due to the small amount in the competitive tender, the Plaintiff is not able to obtain the successful bid to secure the production performance.

2) Classification of the collaborative act in this case and the lapse of the period of prescription for the disposition

① The instant collaborative act is classified into the collaborative act before April 2008 (the first collaborative act) and the collaborative act after April 2008 (the second collaborative act) in light of the participating entity and the motive for the participation of small-scale enterprises, such as the Plaintiff.

② On April 2, 2008, among the bid participation by the Plaintiff, the purchase of underwater pumps, May 23, 2008, the purchase of underwater storage pumps from Namyang-si on May 23, 2008, the materials for the payment of drainage improvement projects from the branch offices of the Korea Development Corporation to the Korea Development Corporation on October 28, 2008, and the tender for the drainage improvement projects from the Seoul Development Corporation on December 26, 2008, the bidding for the distribution improvement projects from the Seoul Development Corporation on December 26, 2008 are not one collaborative act, but the five-year disposal prescription was imposed.

(iii) the deviation and abuse of discretion;

Even if it is recognized that the plaintiff et al. agreed on the collaborative act of this case, the penalty surcharge order of this case is unlawful by abusing and abusing the discretion of the defendant for the following reasons.

(1) In the case of a tendering agreement, the relevant sales amount of a participant may be deemed the contract amount only when Article 19 (1) 8 of the Act applies. As in this case, where Article 19 (1) 1, 3, and 4 applies to the defendant as stated in this case, the relevant sales amount of the plaintiff shall not be deemed the contract amount, but shall be limited to the economic effects that the plaintiff acquired or could acquire during the period of violation, and the cases of bidding for which no profit distribution has been made shall be excluded when calculating the relevant sales amount.

② In light of the fact that the Plaintiff participated in the instant collaborative act only after April 2008, and that the collusion period is shorter and the contract amount is not much significant compared to the violation of the companies that have participated in the supply process since April 2008, the Plaintiff’s act constitutes not only the “serious violation recognized by the Defendant, but also the “serious violation” or “serious violation.”

③ Although the collusion period is less than 1/4 compared to other companies, the Plaintiff did not make adjustment by the period of violation in calculating the first adjustment penalty surcharge. (ii) Although the Plaintiff was a small-scale follow-up business entity, as seen above, was not simply simple or abstract in calculating the second adjustment penalty surcharge, it did not take any additional mitigation thereto; (iii) the Plaintiff’s market share and the amount of profit actually acquired, the amount of penalty surcharge was excessively calculated compared to the amount of profit actually acquired, and the balance between the participants in the instant collaborative act was lost.

B. Facts of recognition

1) At around February 2005, 12 companies, including one-time, effective, new machinery, gold, gold, saluted, saluted, date, F companies, money, JMI, Large Dealing, and East Sea, agreed to determine the successful bidder in advance and the remaining companies to participate in the tender at a premium rate of not more than 1,350m (1,350m) ordered by the Public Procurement Service in the future. After that, the above companies agreed to separately set the order of successful bid in each of the following groups divided into Group A and B, which are divided into group A and B, and the group agreed to be awarded the successful bid in shift (hereinafter referred to as the "net method of acquiring the relevant recommended contract price by being awarded a single bid by an enterprise corresponding to the order of successful bid at the same time in relation to the implementation of the above agreement").

In addition, in order to ensure fairness in the successful bid amount, if the basic amount announced by the Public Procurement Service exceeds 300 million won, the joint order is given to the public procurement agency. Two companies with KRW 300 million to KRW 500 million to KRW 500 million, three companies with KRW 700 million to KRW 700 million, and four companies with at least KRW 700 million to be awarded the successful bid ("joint order method" that the joint order companies jointly receive the case of the bid and distribute profits by winning the contract).

On February 2, 2005, the plaintiff et al. agreed to organize a separate group and make a prior decision on the successful bidder's will, without distinction between A and B, for example, the gold, day, dust, dust, dust, work, efficacy, F company, and JMI, which have all the above-mentioned performance records, if the plaintiff et al. makes a recommendation for the oral bid more than 1,500 meters of underwater pumps.

2) At the initial stage of the instant collaborative act, the agreement was implemented by the sequence system and the joint net order system as above, but the bidding scale has not been clearly considered, seven companies, such as the firstman, filial duty, gold, gold, gold, dust, thirdman, and FF companies, etc. in May 2007, which were ordered by the Public Procurement Service in the future, agreed to determine in advance the successful bidder and the actual bid price that can be produced at the lowest unit price through the joint bid, etc. from the old underwater pumps bid of less than 1,800 meters which were ordered by the Public Procurement Service, and to distribute the difference between the successful bidder and the manufacturing cost to all agreed participants, including the successful bidder (hereinafter referred to as the “the above agreement execution method”).

The profit distribution scheme started on May 28, 2007, and started on March 25, 2009, 12 bidding cases have been implemented from the 'the bidding case for the rainwater Pppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppp

3) The details of bid and profit distribution (unit: source and value added tax) of the Plaintiff’s participation in the instant collaborative act are as follows.

A person shall be appointed.

A person shall be appointed.

【Fact-finding without dispute over the ground for recognition, Gap evidence 1, Eul evidence 1 through 5, and the purport of the whole pleadings

C. Determination

1) Existence of agreement

According to the above facts, not only the plaintiff et al. jointly determined the successful bidder and the bid price in advance, but also assigned or restricted the production volume for each business entity through the sequence system, the joint net order system, and the profit distribution system ordered by the Public Procurement Service. Furthermore, even if the parties to the agreement are restricted or formally constituted a single bid by a specific business entity, the agreement has the same effect as that of the joint bidder. Thus, the plaintiff et al. agreed to act jointly as provided by Article 19 (1) 1, 3, and 4 of the Act, and the reasons asserted by the plaintiff alone does not interfere with the above recognition. Therefore, the plaintiff's above assertion is without merit.

2) Classification of the collaborative act in this case and whether the period of prescription for the disposition has expired

In a case where enterprisers agreed several meetings over a long-term period of time, if the multiple meetings were to carry out the same purpose on the basis of a single intent, and have been continuously carried out without any interruption, such series of agreements ought to be deemed as one unfair collaborative act as a whole, barring special circumstances (see Supreme Court Decision 2007Du3756, Sept. 25, 2008).

In light of the above legal principles, the following circumstances are revealed by comprehensively taking account of the overall purport of the arguments as seen above: ① selection of successful bidders, bid price determination, and a series of implementation processes leading to the reallocation of profits through the same structure for the purpose of maximizeing the interests of the participants in each agreement by avoiding competition in the purchasing market of underwater pumps; ② implementation methods are implemented at the beginning and after May 2007, the change was made to the profit sharing system. Since the issue of equity as to the successful bidder was raised, the conditions of the tender requesting the performance of the production and supply of a specific old price, and the restriction on the participation of large enterprises due to the introduction of the competitive bidding system between small and medium enterprises, and ③ continuing participation in the collaborative act was to enhance equity in allocation between the participants in the agreement while maintaining the allocation agreement between the existing participants; ③ the Plaintiff’s withdrawal from the collaborative act cannot be seen as being in fact contrary to the Plaintiff’s agreement, and thus, the Plaintiff’s withdrawal from the collaborative act cannot be seen as being unlawful in light of the following circumstances.

3) As to the assertion of deviation and abuse of discretionary power

In full view of the provisions of Articles 6, 17, 22, 24-2, 28, 31-2, and 34-2 of the Act, the Fair Trade Commission has discretion to determine whether to impose a penalty surcharge on a violation of the Act, and if a penalty surcharge is to be imposed, the amount of the penalty surcharge should be determined in detail within a certain scope prescribed by the Act and the Enforcement Decree of the Act. Thus, the Fair Trade Commission’s imposition of a penalty surcharge on a violator of the Act is a discretionary act. However, if there are grounds such as misconception of the facts constituting the basis for the imposition of a penalty surcharge in exercising such discretion, or contrary to the principle of proportionality, it shall be deemed illegal as a deviation or abuse of discretionary power (see, e.g., Supreme Court Decision 2006Du4226, Feb. 15, 2008).

In light of the above legal principles, considering the following circumstances revealed by the health team, the above-mentioned facts, and each of the above evidence, it is difficult to view the instant disposition as a deviation from and abuse of the Defendant’s discretionary power.

① Article 22 of the Act and the proviso to Article 9(1) of the Enforcement Decree of the Act provide that the contract amount shall be deemed as related sales if the collaborative act is “tender collusion or any other similar act.” Although the Defendant intended to apply Article 19(1)1, 3, and 4 to the collaborative act of this case, rather than Article 19(1)8 of the Act on Bidding, the bidding collusion can be characterized by a price agreement, an production restriction agreement, and an agreement on restrictions on opposite contractual parties, etc. according to the specific agreement, and the Defendant’s failure to apply Article 19(1)8 of the Act to the collaborative act of this case does not have the nature of the bidding collusion, and it is reasonable to view that the collaborative act of this case constitutes “the basic bid collusion or at least similar act” as the subject of the bidding agreement, and that it can be deemed that the Plaintiff’s agreement was ultimately a contract amount that was already received for the purposes of imposing restrictions on bidding prices and sales in light of the purport and purpose of imposing restrictions on bidding prices under the Act.

② Even if the participation period of the Plaintiff’s collaborative act is relatively short, as seen above, the collaborative act in this case by the Plaintiff, etc., is an agreement on pricing, quantity, and restrictions on transaction partners, making the purpose of the competitive bidding system in fact color, such as a single bidding, and its nature is obvious, on the other hand, the effect of restricting competition is very low in efficiency, and thus, the collaborative act in this case constitutes an act which is highly serious to the degree of its importance (However, the Defendant imposed the lowest 7% within the scope of the imposition standard rate (7% to 10%) according to the “serious serious violation” (the lower 7% to 10%).

③ In light of the developments leading up to the Plaintiff’s participation in the instant collaborative act, the number of bidding participants, and the form and scale of profit sharing method, it is difficult to deem that the Plaintiff was simply involved in, or was engaged in, the instant collaborative act.

④ In calculating a penalty surcharge against the Plaintiff, etc., the Defendant reduced the Plaintiff’s 20% of the criteria for calculation of the first adjustment on the grounds that the Plaintiff et al. consistently recognized the act from the investigation stage to actively cooperate in the Defendant’s investigation. Moreover, even at the calculation stage of the imposition of the penalty surcharge, the Defendant reduced the amount by 30% by reflecting the total successful bid price and the estimated amount of profit per bidding, etc.

Therefore, the plaintiff's above assertion is without merit.

3. Conclusion

Thus, the plaintiff's claim of this case is dismissed as it is without merit.

Judges Lee Jae-won

Judges Kang Jong-chul

Judge Meritorious;

1) The limited successful bidder system is limited to participation in the construction and supply process of the pumps subject to the order, and the efficiency of the pumps and electric motors is also considered in the process of selecting the successful bidder. Accordingly, the Public Procurement Service shall convert the energy efficiency cost of the pumps into the amount of the pumps through the "written indication of quality, etc. submitted by the tender participants", and then shall determine the final successful bidder as the final successful bidder, taking into account the amount invested by each participant in the actual tender.

A person shall be appointed.