[1] The requirements for applying Article 35 subparag. 1 and subparag. 2 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act to reduction or exemption of voluntary reporters, in a case where enterprisers have agreed on the basic principles for price collusion and have continued to enter into specific agreements several times over a long period of time in the process of implementing them, and as a whole, such a series of agreements can be seen as a single unfair collaborative act

[2] The case affirming the judgment below holding that only Gap corporation which provided first evidence as to the unfair collaborative act constituted the requirements for reduction or exemption under Article 35 (1) 1 and 2 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act as the first-class voluntary reporter of the above unfair collaborative act regardless of the time of participation in the case where enterprisers' price collusion of low-density polyethyl products over several occasions for a long time

[1] In light of the language and structure of Articles 22-2(1) and (2) of the former Monopoly Regulation and Fair Trade Act and Articles 35(2)1 and 25(2)2 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act (amended by Presidential Decree No. 18768, Mar. 31, 2005); and the purport of the system of voluntary reporters seeking to discontinue or prevent unfair collaborative acts by undermining the trust of participating enterprisers by granting benefits to those participating enterprisers to voluntarily cooperate in the investigation and provide evidentiary materials; and in light of the purport of the system of voluntary reporters seeking to reduce or prevent unfair collaborative acts by undermining the credibility of participating enterprisers; in cases where, after agreement on basic principles for price collusion and implementation thereof, a series of agreements can be seen as one unfair collaborative act for a long time after holding several meetings, and as a whole, the whole series of agreements can be seen as one unfair collaborative act; among the participating enterprisers, only the first time period of the participating enterprisers and the first time to provide evidence necessary for the unfair collaborative act constitutes one unfair collaborative act.

[2] In a case where enterprisers manufacturing and selling synthetic resin, which is a kind of petrochemicals, were found to have engaged in one unfair collaborative act in collusion with prices of low-density polyethyls products over several times for a long time, the case affirming the judgment below holding that only Gap corporation, which first provided evidence necessary to prove that the collaborative act among the participating enterprisers, constitutes the requirements for reduction or exemption under subparagraphs 1 and 2 of Article 35 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act (amended by Presidential Decree No. 18768 of March 31, 2005), and Eul corporation, which secondly reported, did not meet the requirements for reduction or exemption under subparagraphs 1 and 2 of Article 35 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act as to the part before Gap corporation's participation

[1] Article 2-2 of the former Monopoly Regulation and Fair Trade Act (amended by Act No. 7315 of Dec. 31, 2004); Article 35 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act (amended by Presidential Decree No. 18768 of Mar. 31, 2005) / [2] Article 22-2 of the former Monopoly Regulation and Fair Trade Act (amended by Act No. 7315 of Dec. 31, 2004); Article 35 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act (amended by Presidential Decree No. 18768 of Mar. 31, 2005)

Elmmchemical Co., Ltd. (LLC, Kim & Lee LLC, Attorneys Oi-seok et al., Counsel for the defendant-appellant)

Fair Trade Commission (Attorney Choi Byung-hee et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2010Nu13090 decided November 11, 2010

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

The grounds of appeal are examined.

1. Regarding ground of appeal No. 1

According to the provisions of Article 22 of the former Monopoly Regulation and Fair Trade Act (amended by Act No. 7315 of Dec. 31, 2004; hereinafter referred to as the "Act"), Articles 9(1) and 61(1) [Attachment 2 of the former Enforcement Decree of the Monopoly Regulation and Fair Trade Act (amended by Presidential Decree No. 18768 of Mar. 31, 2005; hereinafter referred to as the "Enforcement Decree of the Act"), where an enterpriser has jointly committed an unfair collaborative act with another enterpriser, the Fair Trade Commission may impose upon the enterpriser a penalty surcharge calculated based on the sales during the relevant period of violation. The scope of the goods or services related to the unfair collaborative act, which serves as the basis for calculating the penalty surcharge, shall be determined individually and specifically by taking into account the type and nature of the goods or services included in the agreement between the enterpriser and the other enterpriser, the purpose of use, possibility of substitution, transaction area, transaction stage, etc. (see, e.g., Supreme Court Decision 2003Du168785, etc.).

In full view of the adopted evidence, the lower court determined that the Defendant’s calculation of the Plaintiff’s relevant sales based on the Plaintiff’s sales price, not the consignment commission, is lawful, based on the following facts: (a) the sales price related to the consignment sales refer to the sales price of the goods related to the “sale or purchase” during the period of the violation, or sales equivalent to the sales price of the goods related to the “sale or purchase” during the violation period; and (b) the sales price related to the consignment sales is reasonable not the consignment sales fee, but the sales price related to the instant consignment sales price of low-density ethyl and the first low-class low-density Porte products; and (c) the sales price related to the instant consignment sales price is not related to the consignment sales fee; and (d) if a part of the enterprisers participating in the unfair collaborative act were to have participated in the consignment sales, deeming the consignment sales fee, not the consignment sales fee, as

In light of the above legal principles and records, the above determination by the court below is just, and there is no error in the misapprehension of legal principles as to the goods related to the price fence agreement of this case and related sales as alleged in the grounds of appeal.

2. Regarding ground of appeal No. 2

According to the reasoning of the judgment below and the evidence duly adopted by the court below, the price collusion between the plaintiff et al. is determined by the representative standard price (hereinafter "base price") for diverse specifications manufactured and sold for each product and each use. Based on these standards, the price was determined by considering individual specifications' production cost, human map, specialized level of products, discount rate, etc. Generally, in the case of special specifications products, based on the price calculated by reflecting additional cost in accordance with the special specifications's standard price. The price collusion of this case was implemented not only to increase the base price but also to the majority of the special specifications products, but also to affect the change in the base price. Thus, in light of the legal principles as seen above, since the price collusion between the plaintiff et al. was directly or indirectly developed and supplied for different SB products at the request of the supplier, the price price of this case can be determined by the plaintiff et al. al. to be determined by the 3000 specific standardized products, and the price of this case can be determined by the plaintiff et al. al., 5000 specific standardized products.

Therefore, the judgment of the court below to the same purport is just, and there is no error in the misapprehension of legal principles as to the goods related to the price fence agreement of this case and related sales as alleged in the ground of appeal.

3. Regarding ground of appeal No. 3

Article 22-2 (1) of the Act provides that "the penalty surcharge under the provisions of Article 22 (Penalty Surcharges) may be mitigated or exempted for a person who has reported an unfair collaborative act or has cooperated in an investigation by means of the provision of evidence, etc." Article 22-2 (2) of the Act provides that "the penalty surcharge shall be mitigated or exempted," and Article 22-2 (2) of the Act provides that matters necessary for the scope of a person who has been mitigated or exempted, standards for mitigation or exemption of a penalty surcharge, etc. shall be delegated to Presidential Decree, and Article 35 (2) 1 and 2 of the Enforcement Decree of the Act provides that "the person who has first provided evidence necessary to prove that he/she is an unfair collaborative act" shall be one of the requirements for reduction of or exemption from

In light of the language and structure of the relevant provisions of the Act and the Enforcement Decree of the Act, and the purport of the voluntary reporters’ reduction or exemption system intending to weaken trust among the participating enterprisers by providing benefits to voluntarily cooperate in investigation, and to discontinue or prevent unfair collaborative acts, in a case where enterprisers have continuously agreed on the basic principles for price collusion and specific agreements have been reached several times during a long period of time in the process of implementing the above agreement, and it can be seen that the whole series of agreements can be seen as one of the unfair collaborative acts, only the first participating enterprisers who provided the first evidence necessary to prove the unfair collaborative acts among the participating enterprisers of the unfair collaborative acts shall be deemed to fall under the requirements for reduction or exemption under Article 35(2)1 and 2 of the Enforcement Decree of the Act on the whole of the unfair collaborative acts regardless of the time of participation.

In light of the above legal principles and the records, the court below is just in holding that the price collusion on low-density ethylene over several occasions for a long time was a single unfair collaborative act, and the second evidence on the above unfair collaborative act was not a requirement for reduction or exemption under Article 35 (2) 1 and 2 of the Enforcement Decree of the Act as to part of the above unfair collaborative act regardless of the participation time of Honam Petroleum Co., Ltd., the first provider, and there is no error in the misapprehension of legal principles as to the exemption of voluntary reporters as otherwise alleged in the ground of appeal.

4. 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 Si-hwan (Presiding Justice)