The prosecutor's appeal is dismissed.

1. The summary of the grounds for appeal (based on factual errors and misapprehension of legal principles) is that the project for improving and repairing the purified bank by C Co., Ltd. (hereinafter “C”) operated by the Defendant (hereinafter “instant project”) is a national policy project. As such, the portion of the subsidies (based on KRW 80,400,00), among the subsidies received by the Defendant (hereinafter “instant subsidies”), and the military subsidies (based on KRW 187,60,00) constitutes “indirect subsidies” under Article 2 subparag. 4 of the former Subsidy Management Act (amended by Act No. 13931, Jan. 28, 2016; hereinafter “former Subsidy Act”).

Meanwhile, the granting of subsidies under the Subsidy Act has the nature of a pre-cost aid rather than ex post facto cost preservation, and the main text of Article 20(2) of the Local Subsidy Management Ordinance (hereinafter “instant Ordinance”) stipulates that no local subsidy shall be granted to a construction project or project implemented before the granting of the local subsidy is made. The Defendant applied for a subsidy by actively stating false facts in order to compensate for the already invested expenses even though the granting group started the instant project prior to the granting of the local subsidy.

Therefore, the Defendant’s act constitutes the receipt of the part of the instant subsidies (268,00,000 won) with the “a false application or any other unlawful means” under Article 40 of the former Subsidy Act.

In full view of the above circumstances, the defendant should be deemed to have received the subsidy of this case by improper means, but the judgment of the court below which acquitted the whole facts charged of this case is erroneous in the misapprehension of legal principles and misconception of facts.

2. Determination

A. The lower court’s determination on the portion of the instant subsidies as to the Do subsidies and military subsidies is based on its stated reasoning. The part of the instant subsidies as to the Do subsidies and military subsidies is prescribed by the former Subsidy Act.