Spain Co., Ltd. (Attorneys Yu Sung-sung et al., Counsel for the defendant-appellant)

The Administrator of the Defense Acquisition Program Administration

April 29, 2008

1. The plaintiff shall reject the lawsuit against the Administrator of the Defense Acquisition Program Administration.

2. The plaintiff's claim against the Minister of Knowledge Economy is dismissed.

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

1. On October 2, 2007, the Administrator of the Defense Acquisition Program Administration revokes the disposition revoking the designation of defense materials regarding the items listed in the separate sheet against the plaintiff.

2. On October 16, 2007, the Minister of Knowledge Economy revokes the revocation of the designation of the defense contractor against the Plaintiff.

1. Basic facts

The following facts are not disputed between the parties, or can be acknowledged by comprehensively taking into account the whole purport of the pleadings in relation to Gap evidence 1 (the same as Eul evidence 9), Gap evidence 2-1, 2-3, Gap evidence 3-1 through 3 (the same as Eul evidence 3), Gap evidence 15, Gap evidence 20, Eul evidence 1, Eul evidence 5 through 8, Eul evidence 11, and some testimony of witness questioning.

A. On May 8, 2001, the Ministry of Science and Technology selected a two-way Heavy Industries Co., Ltd. (hereinafter referred to as “dual Industries”) as a research and development institution of a driving force (development period: from September 2001 to July 2006; the budget: KRW 5.488 billion (government KRW 3.98 billion; the enterprise KRW 1.5 billion).

B. As the development of the promotion period of the two industries was delayed, the head of the Ministry of National Defense, as part of the method of funding through the introduction of technology rather than domestic development, the head of the Ministry of National Defense, on August 21, 2004, and the Plaintiff and the two Industries, as part of the method of funding the introduction of technology, notified that they would prepare a plan for the introduction of technology through prior negotiations with overseas production companies and submit it to the Navy by applying the said guidelines.

C. According to the above guidelines, with respect to the KSWA and the 112 SII model of Sweden, the two industries are undergoing negotiations with respect to the NAWA and the 112 S II model, the Plaintiff is obliged to negotiate with respect to the NAS model of the Netherlands’s LJ 108 (Central), and LJ114 (Coordinat/S) model.

D. On January 4, 2005, the Plaintiff and the two industries participated in the bidding after submitting a plan for the introduction of technology and obtaining approval, and the Plaintiff’s model was adopted. On January 4, 2005, the Navy decided to purchase high speed (PKX) 1 from the Plaintiff who entered into an agreement for the introduction of technology with the French LIPS company.

E. On February 21, 2005, the Plaintiff requested the Ministry of National Defense to designate an propelling machine as defense materials on the Ministry of National Defense, but the Ministry of National Defense, as of May 2005, since the development of technology for both civilian and military use as of May 2005, the Ministry of National Defense developed a propelling machine in the two industries as of July 2006 with the aim of test and evaluation on July 2, 2006, the Ministry of National Defense refused the Plaintiff’s request on the ground that there is insufficient need to designate a high-speed (PKX) defense material from 2nd to 2nd to 2nd to 2nd to 2nd to 2nd to 2nd to 20

F. Upon the Plaintiff’s request for a review of the re-designation of defense materials on June 1, 2005, the Minister of National Defense decided that there was no real possibility and total possibility of manufacturing other companies until August 10, 2007 (PKX) 2-5, which is scheduled to implement the contract on August 10, 2007, and that the development of the technology development engine for both civilian and military purposes is inevitable pursuant to Article 14 of the Technology Development Promotion Act for both civilian and military purposes at the time of the completion of the development of the technology development (military use conformity assessment), and therefore, it is inevitable to designate defense materials as a limited key to 4 parts of the technology development product for both civilian and military purposes. On August 10, 2007, the Minister of National Defense notified the Plaintiff that the goods were designated as defense materials for the promotion machine as follows:

- Defense Product Designated Items

In general, Plaintiff LJ14E/LJ108E (1-4) (1-4) of the general naval ship, whose name is designated as a component of the name of the equipment in the detailed field of the voting sector included in the main text.

G. As such, the Minister of Commerce, Industry and Energy, on August 16, 2007, designated a warranty driving machine as a defense industry product, the Minister of Commerce, Industry and Energy additionally designated the said item to the Plaintiff as a defense industry product.

H. The Ministry of National Defense entered into a purchase contract on September 2, 2005 with the Plaintiff on the high speed (PKX) No. 1, as the Plaintiff’s warranty promotion machine was designated as defense materials.

I. On May 25, 2006, the Administrator of the Defense Acquisition Program Administration determined as the performance satisfaction of the technical test and evaluation of the two mountain Heavy Industries, which was developed as a technology development task for both civilian and military purposes.

(j) On August 2006, the Board of Audit and Inspection issued a request to the Administrator of the Defense Acquisition Program Administration to revoke the designation of defense materials for the main part of the Defendant’s main part, and to review the designation of defense materials after determining the military suitability of the propeller who is developing technology for both civilian and military purposes. Accordingly, on June 29, 2007, the Minister of the Defense Acquisition Program Administration, which was developed as a technology development task for both civilian and military purposes, determined the suitability for provisional military use as a result of the results of land operation test and evaluation, and notified the Plaintiff of the designation of defense materials in accordance with Article 48(3)1 of the Defense Acquisition Program Act (hereinafter “Act”), following consultation with the Minister of Commerce, Industry and Energy (hereinafter “instant revocation of the designation of defense materials”).

(k) On October 16, 2007, the Minister of Commerce, Industry and Energy (amended and enforced by Act No. 8867 of Feb. 29, 2008, the Ministry of Knowledge Economy succeeded to the affairs prescribed in Article 32 (1) of the Government Organization Act as the amendment and enforced of the Government Organization Act, and the Minister of Knowledge Economy (hereinafter the Defendant Minister of Knowledge Economy) notified the Plaintiff that the designation of a defense contractor for the pertinent item is revoked (hereinafter the “designation of the defense contractor in this case”).

(l) On December 31, 2007, the Defense Acquisition Program Administration entered into a purchase contract with the two industries for high speed (PKX) 2 to 5.

2. Related statutes;

It is as shown in the attached Table related statutes.

3. Requests to the Administrator of the Defense Acquisition Program Administration;

A. The parties' assertion

1) The plaintiff's assertion

Since the designation and revocation of designation of defense materials are unilaterally determined by the Administrator of the Defense Acquisition Program Administration in superior status with the defendant and cannot be deemed to have guaranteed equal status to the plaintiff, it constitutes an act of power under public law, not an act in private law, and even if such designation is deemed an interim disposition, if the restriction on rights or external effect occurs to the citizens, it shall be subject to appeal litigation. Thus, the revocation of designation of defense materials of this case constitutes a disposition subject to appeal litigation. The revocation of designation is illegal for reasons such as failing to meet the requirements for revocation of designation prescribed in Article 48(3) of the

2) Main safety defense by the Administrator of the Defense Acquisition Program Administration

The designation and revocation of designation of defense materials is an internal management act of an administrative agency for the work of industrial defense contract and cannot be deemed as an act that directly changes the legal status of an enterprise that produces the defense materials concerned, such as the plaintiff, and thus, the eligibility for an appeal litigation cannot be recognized. The plaintiff's lawsuit against the defendant is unlawful.

B. Determination

1) The term "administrative disposition", which is the object of an appeal litigation, means an act of an administrative agency under public law, which causes direct change in the legal status of a citizen, such as ordering the establishment of a right or the burden of an obligation, or giving rise to other legal effects with respect to a specific matter, and barring any special circumstance, an act, etc., which does not directly cause legal change in the legal status of the other party or other persons concerned, such as actions, intermediation, recommendation, and notification within an administrative authority, shall not be subject to appeal litigation (see, e.g., Supreme Court Decisions 67Nu44, Jun. 27, 1967; 93Nu6331, Oct. 26, 1993; 96Nu433, Mar. 22, 196).

2) The purpose of the Act is to prescribe matters necessary for the performance of defense acquisition programs, such as the improvement of defense capability, fostering of defense industry industry, and the procurement of munitions, etc., for the purpose of establishing the foundation for self-defense (Article 1), and regarding the designation of defense materials, Article 34(1) of the Act may designate materials necessary for the stable procurement cost, strict quality assurance, etc. from among the materials classified as weapons systems after consultation with the Minister of Knowledge Economy, as defense materials: Provided, That materials prescribed by Presidential Decree, which are not classified as weapons systems, may be designated as defense materials, may be prescribed by Presidential Decree, and Article 39(3) of the Enforcement Decree of the Act provides that "any person who intends to manufacture or manufacture munitions, may request the Administrator of the Defense Acquisition Program Administration to designate such materials as defense materials. In such cases, the Administrator of the Defense Acquisition Program Administration shall determine whether such materials are appropriate within three months, and notify the applicant, and Article 34(3) of the Act provides that "The Administrator of the Defense Acquisition Program Administration may not designate defense materials that are possible from more than two manufacturing enterprises in consideration of the level of domestic technology."

In addition, Article 48(3) of the Act provides that "Where defense materials fall under any of the following subparagraphs, the Administrator of the Defense Acquisition Program Administration may cancel the designation of defense materials after consultation with the Minister of Commerce, Industry and Energy." 1.2. or where there is no military requirement or the organizational equipment is deleted. 3. Where military secrets are not required due to the decline in confidentiality rating; 4. Research and development or purchase planning, cancellation of the designation of defense materials, etc.; 4. Article 64(1) of the Enforcement Decree provides that "the Administrator of the Defense Acquisition Program Administration shall review every three years whether the designation of defense materials is continued or cancelled, and take measures accordingly."

On the other hand, Article 26 (1) 6 (c) of the Enforcement Decree of the Act on Contracts to Which the State is a Party stipulates that "where defense materials are manufactured or purchased from a defense industry company pursuant to the Defense Acquisition Program Act" is a reason for free contract

3) As can be seen, the designation of defense materials is ex officio designated where the Administrator of the Defense Acquisition Program Administration considers it necessary for securing stable procurement costs and strict quality assurance, etc. Accordingly, a request for the designation of defense materials pursuant to Article 39(3) of the Enforcement Decree of the Act is limited to the procedural right to request the manufacturer or the potential manufacturer of the relevant munitions to determine whether or not the designation of defense materials is as defense materials, and it is not construed that the designation of defense materials is granted to the substantive right to demand the designation of the relevant goods as defense materials upon the request. As such, regarding the materials designated as defense materials, it can be procured by means of a negotiated contract, not general competitive bidding, pursuant to the Enforcement Decree of the Act on Contracts to Which the State is a Party, since it is possible to secure defense materials by means of general competitive bidding, or by means of free contract, it is merely an internal decision-making of the administrative agency regarding the selection of defense materials to procure, and thus, the designation of defense materials can be revoked by examining whether or not to obtain the designation of the relevant goods as defense materials from the government.

The main defense by the Administrator of the Defense Acquisition Program Administration pointing this out is reasonable.

C. Sub-committee

Therefore, the Plaintiff’s lawsuit against the Defendant is unlawful.

4. Request to the Minister of Knowledge Economy;

A. Determination on this safety defense

The Minister of Knowledge Economy asserts that the disposition of the revocation of the designation of the defense contractor of this case is a simple follow-up measure based on the revocation of the designation of the defense contractor of this case, and that there is no interest in the lawsuit against the revocation of the designation of the defense contractor of this case, but the defense contractor of this case cannot be viewed as having no interest in the lawsuit only

B. Judgment on the merits

The plaintiff is an illegal administrative disposition to revoke the designation of the defense industry enterprise of this case, and the disposition to revoke the designation of the defense industry enterprise of this case is also illegal. However, as seen in paragraph (b) of the above, the revocation of the designation of the defense industry enterprise of this case cannot be viewed as an administrative disposition, and the revocation of the designation of the defense industry enterprise of this case can not be viewed as the revocation of the designation of the defense industry enterprise of this case, since the designation of the defense industry enterprise of this case is revoked by the maintenance measures of the defense industry

Therefore, the plaintiff's claim against the defendant is without merit.

5. Conclusion

Therefore, the plaintiff's lawsuit against the Administrator of the Defense Acquisition Program Administration is dismissed as illegal, and the claim against the defendant with the Minister of Knowledge Economy is dismissed as it is without merit. It is so decided as per Disposition

[Items Omitted]

Judge Jeong Ho-sung (Presiding Judge)