Disposition, such as cancellation of qualifications to participate in competitive tendering process open only to small and medium enterprises, 2016Guhap83792

Claim for Revocation

A Stock Company

The Small and Medium Business Administration

May 23, 2017

June 8, 2017

1. The plaintiff's claim is dismissed.

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

The defendant's disposition on December 1, 2016 to revoke the plaintiff's qualification for participation in competitive tendering process open only to small and medium entrepreneurs and to restrict the acquisition of participation eligibility for six months is revoked.

1. Details of the disposition;

A. The plaintiff is a legal entity established around December 1984 and engaged in the production and sales business of B (B; hereinafter referred to as “B”), and the representative director is C.

B. A cooperative (hereinafter referred to as the "cooperative of this case") consists of 17 companies including the plaintiff who produces B (the plaintiff, E, F, G, H, I, limited liability company, K, L, M, Inc., M, Inc., N, P, P, P, Q, Q, R, S, S, T. and hereinafter referred to as the "Co., Ltd."), and individual companies are comprised of 17 companies including the plaintiff who produces B (the plaintiff, E, F, H, K, I, K, K, M, Inc., and the name of the corporation, excluding the "stock company," and limited liability company).

C. From April 17, 2012 to May 24, 2016, the Plaintiff: (a) had the instant association and the instant member companies enter into a contract publicly announced by the initial limited competition method so that the Plaintiff would not select a successful bidder by intentionally bidding, single bidding, or excess of the estimated price; (b) had the ordering agency convert the contract method into a negotiated contract method; and (c) had the designated company receive the contract method by a negotiated contract method (hereinafter referred to as “instant collusion act”).

D. On September 21, 2016, C, as the representative director of the Plaintiff, obtained property benefits derived from the bid price amounting to KRW 54,063,620,875 in collusion with the representative director, etc. of the instant member company, thereby undermining the fairness of the instant bidding in a deceptive scheme or other means with respect to government-funded B purchase bid ordered by public agencies, such as the Public Procurement Service, by means of a fraudulent scheme or other means, the Defendant was sentenced to one year of imprisonment, three years of suspended sentence, and the Seoul Central District Court was sentenced to three years of suspended sentence (hereinafter referred to as the “instant criminal judgment”), and appealed against the said judgment, but the appellate court was sentenced to the dismissal of the appeal on February 3, 2017 (Seoul Central District Court Decision 20163816), and the present final appeal (Supreme Court Decision 2017Do3266, Apr. 6, 2017).

E. On December 8, 2016, the Defendant issued a disposition against the Plaintiff for six months (from December 8, 2016 to June 7, 2017) on the grounds that the instant collusion conducted by the Plaintiff constitutes “an unfair act, such as collusion,” as stipulated in Article 8(3)3 of the Act on the Promotion of Purchase of Small and Medium Enterprise Products and the Development of Market Support (hereinafter referred to as “the instant disposition”).

A person shall be appointed.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 4, Eul evidence Nos. 1 through 3 (including each number), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The instant disposition is unlawful for the following reasons.

1) Non-existence of grounds for disposition

Although the plaintiff's act of collusion in this case was true, it is inevitable for the plaintiff to conduct a collusion with the characteristics of B, which are inevitable to produce a large scale small quantity of production, and the successful bid price or the bid rate of bid price were higher than the supply price to the private market or the bid rate of the government-funded market of large enterprises, and thus doing not harm the fairness of competition or cause losses to the State, and since the structural contradiction in the designation system of competing products between small and medium enterprises, there is no possibility that fair execution of competition or appropriate execution of the contract is likely to be impeded, so the act of collusion in this case does not constitute "the case where the act of collusion in this case was committed" under Article 8 (3) 3

2) Violation of the principle of proportionality or deviation and abuse of discretionary power

Even if the Plaintiff’s act of collusion falls under Article 8(3)3 of the Act on the Promotion of Development of Agricultural and Fishing Villages, the instant disposition violated the principle of proportionality and abused discretion in light of the following: (a) the purport of designating competing products between small and medium enterprises and half of the sales amount is reversed; and (b) the Plaintiff’s act of collusion

(iii) double punishment;

In addition, apart from the defendant's disposition of this case, the Administrator of the Public Procurement Service made a two-year disposition of restriction on participation in the collusion of this case, and the disposition of this case constitutes double punishment.

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

1) Competing B’s designation of competing products between small and medium entrepreneurs was designated as competing products only between small and medium enterprises under Article 6 of the Act on the Development of Agricultural and Fishing Villages and granted opportunities to participate in the bid procedures for B purchase ordered by public institutions, such as the Public Procurement Service only to small and medium enterprises. In particular, since a public corporation and quasi-governmental institution, newly established on December 29, 2009, entrusted the purchase of B to the Administrator of the Public Procurement Service, the size of B’s government-funded market increased from around that time

2) Organization of working-level council, representative council, etc.

A) Around April 209, the instant member companies established the “Operational Rules of the B Working-level Council (hereinafter referred to as the “Operational Rules of the instant member companies”) consisting of members B at the time of the instant association, and consulted on the allocation of quantities and the maintenance of prices in the supply market B including the private capital market among the members. As the representative of the instant association, the working-level council (referring to the group of executives in charge of the instant member companies; hereinafter referred to as the “Working-level Council”), the representative council (referring to the group of representative directors of the instant member companies), the file subcommittee, and the Korean file council, etc. to exchange information on the monthly production and sales performance and inventory status of the instant member companies and to maintain the B unit price in the government-funded market, and to check whether the joint production plan was implemented as the practice method, and to adjust the volume of production and release for government-level B by checking compliance with the schedule.

B) All of the 17 member companies of the instant case participated in the instant working-level council.

3) The method of the instant collusion

A) The instant member companies, with respect to the government-grade B purchase bid, failed to determine the level of successful bid price by taking into account the activity areas, production and inventory volume, bidding score, etc. of the members, and then failed to enter into a negotiated contract. The instant member companies, other than those who are scheduled to award a successful bid and those who are scheduled to award a successful bid, implemented a bid collusion in the manner of not participating in the pertinent bidding, and participated in the bid in order to enhance the basic amount publicly notified by the ordering agency, such as “free bid, single bid, and bid exceeding the estimated price,” so that a specific member company can enter into a negotiated contract.

B) Specifically, in the event that the Plaintiff participates in the bidding individually, the Plaintiff determined whether to participate in the bidding within the first week, and determined whether to participate in the final bid for each individual bid after consulting with other companies at the instant working-level council. If the Plaintiff is determined as an allocated company for a specific B supplied case at the working-level council of the instant working-level, the Plaintiff determined a bid rate to the extent that it does not exceed the projected price, and requested a new subcontractor to participate in the bidding at the same time by notifying the new subcontractor of the specific bid bid rate, and the same applies to other members.

4) The main contents of the instant operational rules formulated around 2009, as follows.

B The Consultative Council under Article 5 (Duties of the Consultative Council) of the Operating Rules of the Working Council shall deliberate, determine, and execute the following matters.1. 1. Coordination on the fair Serial system and reasonable price by mutual consultation; 2. Coordination on the surveillance of unfair acts and the joint response to unfair bidding; 3. Determination on the order of priority of official and private bidding; 4. The execution of all acts to stabilize the file industry at the representative director's meeting shall be carried out jointly by the representative director's meeting in violation of the provisions of Article 2, and shall be dealt with jointly by the resolution of the Consultative Council. 1. 2. The relevant representative director shall be invited to visit the organization at the time of detection of the violation. 2. 3. 3. The order of priority shall be excluded from twice the number of bidding days at the government and private level; where the violation has great damage to the industry, the two members may withdraw from the working council (temporary, temporary) with the consent of all members at least 2/3, and whether the two members may withdraw from the working council (1. 2. 5. 1. 2. 2. 5. 3. 2.1.1. .1.1.1.1.1.1.1.1.1.2).2).

(3) Each member shall have the duty to notify within the prescribed time limit without falsity to the executive organ whether the basic order has received the request for bid(s) and shall accept any disadvantage from the tender(s). (4) Each member shall make his/her best and may impose sanctions when he/she takes place without prior consultation. (4) Each member shall make every effort to ensure that the Council is awarded a successful bid at a unit price set by the Council, and may make any sanctions when he/she takes place without prior consultation.(4-1) Each member shall make an occasional decision and notification of the bid price, settlement conditions, etc. (5) the preferential bidder shall be able to replace the subordinate representative director with the interests of the meeting(s) (s) the number of persons who take advantage of the quantity of each bid(s) by bidding(s) and the number of persons who take part in the bidding(s) shall be 2/3) the number of persons who take part in the bidding(s) and the number of persons who take part in the bidding(s) shall be 3) the number of persons who take part in the bidding(s).

5) The instant criminal judgment

In addition to the plaintiff's representative director, the president of the association of this case, the representative director or executive officer of the Gap 2, from July 201 to May 24, 2016 as co-defendants. The Seoul Central District Court has significantly undermined the fairness of bidding by abusing the designation of competing products; the defendants return to the citizen's cost; the extent and degree of involvement in the act; the size of the price of the bid; the number of representative director of the Gap 2, the representative director of the Gap 1, the representative director of the Gap 2, the representative director of the Gap 2, the representative director of the Gap 3, the representative director of the Gap 1, the representative director of the Gap 2, the representative director of the Gap 3, the representative director of the Gap 2, the representative director of the Gap 3, the representative director of the Gap 2, the representative director of the Gap 3, the representative director of the Gap 1, the representative director of the Gap 2, and the director of the Gap 1, the term of imprisonment for each of this case.

6) Disposition of restricting the participation of the Administrator of Public Procurement Service

A) On September 1, 2016, on the ground that the Plaintiff committed the instant collaborative act and was awarded a successful bid by leading the collusion, the Administrator of the Public Procurement Service rendered a disposition to the Plaintiff to restrict the participation in the tendering procedure under attached Table 2 / [Attachment 2] Article 27(1) of the former Act on Contracts to Which the State Is a Party (amended by Act No. 14038, Mar. 2, 2016; hereinafter “former State Contracts Act”); Article 76(1)7 of the former Enforcement Decree of the Act on Contracts to Which the State Is a Party (amended by Presidential Decree No. 27475, Sep. 2, 2016; hereinafter “former Enforcement Decree of the State Contracts Act”); Article 76(1) [Attachment 2] of the former Enforcement Rule of the Act on Contracts to Which the State Is a Party (amended by Ordinance of the Ministry of Strategy and Finance No. 573, Sept. 23, 2016; hereinafter “former Enforcement Rule of the State Contracts Act”).

B) On April 27, 2017, the Plaintiff filed a lawsuit seeking revocation of the disposition against the instant restriction on participation in the tendering procedure, and this court (2016Guhap74521) decided on April 27, 2017 that the Plaintiff’s act of collusion under Article 76(1)7 of the former Enforcement Decree of the State Contracts Act constitutes a case where: (a) the bidder or the other party to the contract entered into a competitive tendering procedure, contract or agreed on the price, quantity or contract, etc. in advance; (b) the Plaintiff cannot be deemed to have led to collusion in the instant tendering procedure; and (c) the Plaintiff cannot be deemed to have led to collusion in the instant tendering procedure; (d) the Plaintiff’s act of collusion under Article 76(1)7 of the former Enforcement Decree of the State Contracts Act; (e) Article 76(1) [Attachment 2] [Attachment 9] of the Enforcement Rule of the State Contracts Act; and (e) Article 76(1) [Attachment 2] of the former Enforcement Rule of the State Contracts Act.

[Ground of recognition] Facts without dispute, Gap evidence 1, 4, 8, Eul evidence 1 to 3 (including each number), the purport of the whole pleadings

D. Determination

1) Confirmation of applicable legislation

In principle, whether an administrative disposition is lawful shall be determined on the basis of the relevant law and fact at the time when the administrative disposition was taken (see Supreme Court Decision 80Nu412, Dec. 8, 1981). However, in the case of a punitive administrative disposition, determination of the legality of the administrative disposition in accordance with the law and fact at the time of the unlawful act

must be seen (see, e.g., Supreme Court Decision 83Nu383, Dec. 13, 1983; Supreme Court Decision 86Du63, Jan. 20, 1987). The instant disposition is a restrictive administrative disposition that revoked the eligibility for participation in competitive bidding between small and medium entrepreneurs, and restricts the acquisition of eligibility for participation for six months, and thus, the applicable method of action ought to be applied.

However, Article 8 (3) of the current Act on Support for Development of Market (amended by Act No. 13866, Jan. 27, 2016) can be revoked or suspended for up to one year where a small and medium enterprise participating in competitive bidding between small and medium enterprises falls under any of the following subparagraphs:

However, in cases falling under any of subparagraphs 1 through 3, Article 3 of the former Enforcement Rule of the Act on the Promotion of Purchase of Small and Medium Enterprises (amended by Act No. 10504, Jul. 1, 2011; Act No. 1386, Jan. 27, 2016; hereinafter referred to as the "former Enforcement Rule of the Act on the Promotion of Development of Agricultural and Fishing Villages") provides that "where the Administrator of the Small and Medium Business Administration cancels the eligibility for participation, he/she may restrict the acquisition of the eligibility for participation within one year from the date of cancellation." In addition, Article 8 (3) of the former Enforcement Rule of the Act on the Promotion of Purchase of Small and Medium Enterprises (amended by Act No. 1386, Apr. 28, 2016; hereinafter referred to as the "former Enforcement Rule of the Act on the Promotion of Development of Agricultural and Medium Enterprises") provides that the Administrator of the Small and Medium Business Administration may cancel the eligibility for participation within 10 years from the date of cancellation of the eligibility for participation.

Meanwhile, the fact that the instant collusion was conducted from April 17, 201 to May 24, 2016 is as seen earlier.

Therefore, from April 17, 2012 to April 27, 2016 among the instant collusion, Article 8(3)3 of the former Act on the Development of Markets, Article 4 [Attachment Table 1] 3 A, and Article 4 [Attachment Table 1] of the Enforcement Rule of the Act on the Development of Markets, from April 28, 2016 to May 24, 2016, Article 8(3)3 of the Act on the Development of Markets, Article 4 [Attachment Table 1] 3 of the Enforcement Rule of the Act on the Development of Markets, Article 4 [Attachment Table 1] 3 shall apply.

2) Whether an act constitutes “an act of improper conduct, such as collusion,” under the Act on the Support of Market Support or the former Act on the Support of Market Support

(4) On April 209, the instant member companies, including the Plaintiff, had established the instant operational rules with which they are members B at the time of the instant association around April 1, 209, based on the following circumstances: (i) the number of participating in the instant bidding agreement or the instant bidding agreement for 7 years; (ii) the number of participating in the bidding agreement and the instant bidding agreement were regularly held by the working-level council, the representative council, file subcommittee, and the Korean file council; (iii) the number of participating in the bidding agreement and the number of participating in the bidding agreement for 6 years; and (iv) the number of participating in the bidding agreement and the number of participating in the bidding agreement between the Plaintiff and the 60-year period, based on the characteristics of the evidence and the overall purport of each of the above facts of the facts of the facts of the instant bidding; (iii) the number of participating in the bidding agreement and the number of participating in the bidding agreement between the Plaintiff and the 5-year number of participating in the bidding agreement. As to the method of the instant bidding agreement, the number of participating in bidding agreement.

It is reasonable to see that it is.

Therefore, we cannot accept this part of the plaintiff's assertion.

3) Whether a violation of the principle of proportionality or a deviation or abuse of discretionary power

Whether a punitive administrative disposition exceeds the scope of discretion under the social norms or abuse of discretionary power shall be determined by comparing and balancing the degree of infringement on public interest and the disadvantages suffered by an individual due to the relevant disposition, by objectively examining the content of the offense committed as the ground for the disposition, the public interest achieved by the relevant disposition, and all the relevant circumstances. In such cases, even if the criteria for the punitive administrative disposition are prescribed in the form of Ordinance of the Ministry, it is nothing more than that prescribed in the administrative agency’s internal rules for handling affairs, and it has no effect to the public and court externally, and whether such disposition is legitimate or not must be determined in accordance with the relevant Acts and subordinate statutes, not only the above criteria for disposition but also with the contents and purport of the relevant Acts and subordinate statutes. Thus, it cannot be said that the relevant disposition is legitimate merely because the said criteria meet the above criteria for disposition. However, it cannot be deemed that the relevant disposition does not conform with the Constitution or laws, or that the sanctions imposed pursuant to the above criteria for disposition is considerably unfair in light of the content and purport of the relevant Acts and subordinate statutes (see Supreme Court Decision 2007Du69646, Sept.

Pursuant to Article 8(3)3 of the Act on the Development of Agricultural and Fishing Villages, where a small and medium enterprise engaged in unfair conduct, such as collusion, the defendant shall revoke the qualification for participation in the competitive bidding conducted by small and medium enterprise proprietors, and pursuant to Article 8(5) of the same Act, the defendant may restrict the acquisition of participation eligibility within one year from the date of revocation of the qualification for participation. Article 8(3)3 of the former Act on the Development of Agricultural and Fishing Villages may, where a small and medium enterprise engaged in unfair conduct, such as collusion, the defendant may cancel the qualification for participation or suspend it for a period not exceeding one year, and may restrict the acquisition of participation eligibility within one year from the date of revocation of the qualification for participation. Article 4 [Attachment 1] 3 of the Enforcement Rule of the Act on the Development of Agricultural and Fishing Villages

However, in light of the fact that a small and medium enterprise engaged in an unfair act, such as collusion, in a contract under the Act on the Support of Development of Agricultural and Fishing Villages, requires public interest to prevent losses suffered by a public institution by suspending the participation in a competitive bidding for a certain period of time or revoking the participation eligibility, the grounds for sanctions and the degree of sanctions, etc., it is difficult to deem the above disposition standards to be inconsistent with the Constitution or laws. In light of the fact that the frequency of the Plaintiff’s collaborative act is 98 cases and the successful bid amount is about KRW 54 billion, it is difficult to deem the instant disposition to be significantly unfair.

Therefore, even if considering all circumstances asserted by the Plaintiff, the instant disposition cannot be deemed to violate the principle of proportionality, or to have been abused or abused discretionary power, and thus, the Plaintiff’s assertion on this part shall not be accepted.

4) Whether double punishment is double punishment

In light of the purport of Article 7(1) of the former Enforcement Decree of the State Contracts Act; Article 76(1)7 of the former Enforcement Decree of the State Contracts Act; Article 76(1) [Attachment 2] of the former Enforcement Decree of the State Contracts Act; Article 76(1)1 of the former Enforcement Decree of the State Contracts Act provides that the period of restriction on the participation of small and medium enterprises under Article 8(3) of the former Enforcement Decree of the State Contracts Act shall be determined by Presidential Decree; Article 76(1)1 of the former Enforcement Decree of the State Contracts Act shall be determined to be less than the period of restriction on the participation of small and medium enterprises; Article 1 of the former Enforcement Decree of the State Contracts Act shall be determined to be less than the period of restriction on the participation of small and medium enterprises under Article 7 of the former Enforcement Decree of the State Contracts Act; Article 8(3)3 and (5) of the former Enforcement Decree of the State Contracts Act; Article 8(3) of the former Enforcement Decree of the State Contracts Act, which provides for the restriction on the participation of small and medium enterprises.

3. Conclusion

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

The presiding judge, Yoon-sung

Judges Kim Jae-han

Judge Kang Dong-hun

1) The Plaintiff entered the date of disposition in the warden as December 5, 2016, but it appears to be a clerical error.

2) The foregoing provision was amended by Ordinance of the Ministry of Knowledge Economy No. 193 on July 8, 201, and it was not amended after July 1, 2011.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.