2015Guhap69348 Revocation of the disposition of refusal to renew the license for CATV broadcasting business

A Broadcasting Corporation A

B Representative Director

Law Firm LLC et al., Counsel for the defendant-appellant

[Defendant-Appellee] Defendant 1 and 10 others (Law Firm Gyeong, Attorneys Park Jong-ho et al., Counsel for defendant-appellee)

The Minister of Science, ICT

The litigation performer and the co-ordinator;

Law Firm LLC, Attorney Park Jae-soo

Attorney Park Jong-sik, Justice Song-dae, Justice Song-dae, Justice Song-tae, Counsel for the plaintiff-appellant

January 14, 2016

January 28, 2016

1. On July 23, 2015, the Defendant’s rejection disposition to renew the license for CATV broadcasting business as indicated in the attached Table against the Plaintiff is revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order of the Gu office.

1. Details of the disposition;

A. The Plaintiff obtained permission for CATV broadcasting business (hereinafter “instant permission”) from the Korea Communications Commission on May 25, 1995 as a CATV broadcasting business operator with the Seo-gu Metropolitan City’s broadcasting zone, and received a renewed permission for CATV broadcasting business (hereinafter “instant renewed permission”) from the Korea Communications Commission on four occasions every three years since 1997.

B. On December 31, 2009, the Plaintiff applied for the renewal of the license on June 30, 2009 to the Korea Communications Commission. On December 17, 2009, it is difficult to expect that the Plaintiff would not have any public interest, fairness, and public interest of the broadcast by paying deposits and rents to its specially related persons for the renewal of the license of 10 billion won (the Seoul High Court Decision 200 billion won was 70 billion won for the first time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time for the second time.

D. On July 23, 2015, Defendant (as amended by Act No. 11710, Mar. 23, 2013; the Korea Communications Commission transferred the right to license and renewed license for CATV broadcasting business to the Defendant) rejected the Plaintiff’s application for renewed license on the grounds of the review conducted by the Committee for Review of Re-permission as follows (hereinafter “instant rejection disposition”).

As a result of the review and the total evaluation point of 0: 496.61 No. 1,00 per annum; 650 or less per annum; 60 or less per annum; 40 or less per annum; 60 or less per annum; 60 or less per annum; 40 or less per annum; 60 or less per annum; 8 or less per annum for the production and re-approval of PP-1; 60 or less per annum; 60 or less per annum for the production and re-approval of PP-1; 60 or less per annum; 60 or less per annum for the re-issuance of PP-1; 70 or less per annum for the re-issuance of PP-1; and 10 or less per annum for the re-issuance of PP-2; and 10 or less per annum for the re-approval of the production and re-approval of PP-1; 20 or less per annum for the re-issuance of the existing PP-1.

2. Whether the rejection disposition of this case is legitimate

A. The plaintiff's assertion

The substance of the instant rejection disposition constitutes the revocation of a renewed license for CATV broadcasting business, and thus, the illegality of the said rejection disposition is determined based on whether the grounds correspond to the grounds for revocation of a license for CATV broadcasting business under Article 18 of the Broadcasting Act. In light of the following: (a) the Plaintiff has no grounds for the said revocation or corresponding grounds; (b) the grounds for the said disposition are lack of objective rationality or validity; and (c) the Korea Communications Commission and the Defendant’s renewed license to other CATV broadcasting business operators, the instant rejection disposition is an illegal disposition that deviates from

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Criteria for determining illegality

In general, if the effective period of an administrative disposition is determined, the effect of the administrative disposition shall be invalidated upon the lapse of the permitted period: Provided, That if the permitted period is unreasonably short due to the nature of the permitted business, such period may be interpreted as not the duration of the permission itself, but as considering the revision of the condition upon arrival of that period. However, even if the original period of the permission itself is not the duration of the permission itself, but the original period of the permission is not the duration of the permission itself, if the original period of the permission is considered as the whole duration including the extension of the extended period, then it does not constitute an unfair short period due to the nature of the permitted business, an administrative agency with discretionary authority as to whether to grant the permission in accordance with the provisions of the relevant Acts and subordinate statutes should not consider only the revision of the permission, but may refuse to extend it as an exercise of discretionary power, and thereby becomes null and void (see, e.g., Supreme Court Decision 2003Du12837, Mar. 25, 20

In addition to the purport of the entire pleading in the above facts, the following circumstances, i.e., CATV broadcasting business, which can be seen as investing enormous capital due to its nature, and on the premise of installation of large-scale facilities, is expected to have a certain long-term continuity. Nevertheless, in light of the fact that the Plaintiff first obtained the permission by the Broadcasting and Communications Commission on May 25, 1995 by setting the permission period as 197, and even after the renewal of the permission of this case, it was running CATV broadcasting business several times after the renewal of the permission of this case, it is reasonable to view that the three-year permission period and three-year permission period attached to the permission of this case as being unfairly short due to the nature of the permitted business, constitutes not the duration of the permission of this case and the renewal of the permission itself, but the continuation of the

However, even if the duration of the terms of permission is considered as the duration of the terms of permission, the Plaintiff’s total period of permission and the renewal of the permission has reached 14 years in total by obtaining the permission and the renewal of the permission from the Korea Communications Commission several times every three years. Accordingly, the period of the permission and the renewal of the permission in this case may no longer be deemed as unfairly short due to the nature of the permitted business, since the period of the permission in this case and the renewal of the permission in this case is no more than July 23, 2015, after the expiration of the final renewal of the permission period, and the validity of the renewal of the license in this case may be terminated by the refusal disposition in this case.

Considering the above circumstances, the substance of the instant refusal disposition does not differ from the disposition revoking the renewed license of a CATV broadcasting business, but it means that the said disposition does not have a big difference in terms of its validity. However, in light of the Broadcasting Act’s classification of criteria for review of renewed license of a CATV broadcasting business (Articles 17 and 10) and grounds for revocation of permission (Article 18) and the purpose of the Broadcasting Act that enhances the public responsibility of broadcasting, thereby protecting the rights and interests of viewers, creating democratic public opinion, enhancing national culture, and contributing to the development of broadcasting and the promotion of public welfare, the determination of the instant refusal disposition is made based on whether the criteria for review of renewed license itself violates the provisions of Acts and subordinate statutes or significantly lacks rationality or validity in light of the purpose of the Broadcasting Act, or whether each item of assessment set forth in the criteria for the said review has been conducted without rationality or validity (the Plaintiff’s assertion in this part is not accepted).

2) Whether the grounds for disposition are recognized

A) Comprehensively taking account of the purport of the entire arguments stated in Gap evidence Nos. 3, 5, 6, 7, 9, and Eul evidence Nos. 5 through 8, the plaintiff received a civil petition (hereinafter referred to as "the civil petition of this case") with the purport that "the defendant's previous disposition was revoked by the final judgment of this case by posting it on the Seo-gu website, terrestrial broadcasting caption, etc." (hereinafter referred to as "the defendant's provisional petition") around 20 days from December 3, 2013 to August 20, 2014, the defendant may not request the plaintiff to supplement the application for renewal of the license of this case from 20 days to 20 days from August 20, 2014, and the defendant may not request the defendant to supplement the documents to be corrected from 14 times to 20 days from 20 days from 20 days from 20 days from 24, 2014 to 20 days from 14.

According to the above facts of recognition, the Plaintiff withdrawn the submission of the supplementary data of this case on the ground that the Defendant did not resolve the civil petition of this case before the Defendant’s renewed permission was conducted. Unless there is no evidence to prove that the Defendant is obligated to perform the Plaintiff’s civil petition of this case, it cannot be deemed that the Defendant failed to review the Plaintiff’s business plan of CATV broadcasting business, etc. included in the supplementary data of this case. Thus, the ground for first disposition

B) Comprehensively taking account of the overall purport of the arguments in Gap evidence Nos. 10, 11, 12, 15, 40, 42, and Eul evidence Nos. 9, the plaintiff was a shareholder of the plaintiff at the time of June 30, 2004, and the purport of the whole pleadings as to Gap evidence Nos. 2 disposition No. 10, 11, 12, 15, 40, 42, and Eul evidence No. 9, the plaintiff leased a deposit amount of KRW 70,00,000 (including additional tax), KRW 15,000,000,000,000 from July 1, 2004 to KRW 36,000,000,000 for lease and part of the above building (including KRW 3,000,000,000,000,000,000).

According to the above facts of recognition, even though the Plaintiff is deemed to have leased a building from D, who is a specially related person, it is difficult to view that the Plaintiff unfairly supported D by paying deposit and rent higher than the surrounding market price, and there is no evidence to acknowledge otherwise. Therefore, the ground for disposition No. 2 is not acknowledged.

C) Comprehensively taking account of the overall purport of the arguments in the evidence Nos. 16 and 43 as a whole, the Plaintiff did not pay a total of 3,065,14,000 won to the PP (business operators) from 2005 to 2008, and the Korea Communications Commission recommended that the PP program user fee that has not been paid to five business operators including the Plaintiff should be paid in full until July 30, 2009, and the Plaintiff paid all of the unpaid PP program user fee on October 22, 2009, prior to the instant previous disposition.

According to the above facts, a CATV broadcasting business operator is supplied with a broadcast program from a PP business operator, pays a broadcast program fee to the PP business operator in return, and the PP business operator is required to ensure that the PP business operator can promote the development of the prior circulation of the entire broadcasting video industry by reinvestmenting such profits in the production, etc. of a broadcast program, but it seems that the plaintiff failed to meet the standards of "reasonable of the planning, programming and production plan of a broadcast program" under Article 10 (1) 2 of the Broadcasting Act by failing to pay the program user fee to the PP business operator

D) Comprehensively taking account of the overall purport of the arguments in evidence Nos. 17, 18, 19, and 44, the Plaintiff’s direct investment cost from 2006 to 2008 based on the Plaintiff’s financial statements was an average of KRW 4,483,00 per annum. Meanwhile, on June 30, 2005, the Plaintiff and the Plaintiff provided K-Korea with offices, warehouses, vehicles, sound equipments, etc. free of charge to the Plaintiff, and the K-Korea provided the Plaintiff with a view to “the installation and provision of stage, sound, and lighting equipment free of charge to the Plaintiff” (hereinafter referred to as the “instant MOU”). The Plaintiff presented the Defendant’s opinion that the actual production cost varies from 2006 to 200 to 209 to 2005 to 306 to 49,58,000 for free use under the instant MOU’s previous statement of understanding.

According to the above facts, although the direct investment cost according to the Plaintiff’s financial statements is relatively small, it appears that the gain that the Plaintiff gains while using equipment, etc. without compensation pursuant to the Plaintiff’s memorandum of Understanding appears to have not been reflected in the above direct investment cost, and in light of the Plaintiff’s participation in regional events and the current status of production of its own programs, it is difficult to view that the Plaintiff’s efforts to revitalize the local channel was insufficient to satisfy the criteria of “regional, social, and cultural needs and validity” under Article 10(1)3 of the Broadcasting Act, and there is no evidence to acknowledge otherwise.

E) Comprehensively taking account of the purport of the entire arguments in the evidence Nos. 10 and 20, the Plaintiff executed total of KRW 2,850,000 from 206 to 2008 as the education and training expenses for the operation of broadcasting, and there is a difference between the amount executed by other enterprisers (minimum from KRW 8,420,00 to KRW 141,78,00), and the Plaintiff had delayed payment of wages to E, an employee, etc. for three months or more. According to the above facts, the Plaintiff appears to have failed to meet the “reasonable of management plans, such as organization and human resources operation” under Article 10(1)4 of the Broadcasting Act, and thus, the grounds for disposition No. 5 is recognized.

F) Comprehensively taking account of the overall arguments stated in Gap evidence Nos. 21 through 25, 47, 48, and Eul evidence Nos. 11, 12, 14, and 21 as of December 31, 2008, according to the balance sheet as of December 31, 208, -60,226,71, total assets amounting to 5,463,672, total debts amounting to 8,755,813,813,329, total assets amounting to - 329,62,657, 209, 307, 209, 207, 309, 207, 3006, 205, 209, 3006, 207, 209, 300,000,000 won, 307,000,000 won.

According to the above facts, the plaintiff was considerably weak to the soundness of the financial structure such as capital erosion in the balance sheet in 2008, and did not make an investment in the digital broadcasting-related facilities after around 2006, and it seems that the plaintiff did not meet the "financial and technical capacity" criteria under Article 10 (1) 5 of the Broadcasting Act, such as where the technical ability for digital broadcasting is considerably deteriorated due to deterioration of the facilities, etc.

G) Comprehensively taking account of the overall purport of the arguments in the evidence No. 7 Disposition No. 29, 50, and Eul evidence No. 15, the defendant renewed the license for CATV broadcasting business to the plaintiff around 2006 (the evaluation result 702.16) and attached an additional note to the effect that "the status of payment of PPP receiving fees shall be submitted to the Korea Broadcasting Commission, and the status of management improvement shall be submitted to the Korea Broadcasting Commission within one month from the closing date of each year, and within one month from the closing date of each year." The plaintiff can be recognized that the plaintiff submitted data related to the above additional official (management improvement, details of payment of PP receiving fees, etc.) to the Korea Communications Commission only once on August 7, 2007. According to the above facts, since the plaintiff failed to comply with the requirements of the business operator at the time of the renewal of the license (Article 17 (3) 66 of

H) Sub-decisions

Therefore, the grounds for the 1, 3, 5, 6, and 7 of the grounds for the rejection disposition of this case are recognized, and the grounds for the 2, 4 are not recognized.

3) Whether the discretion is deviates or abused or not

A) Conditional renewed license cases

From 2009 to 2011, Korea Communications Commission and the defendant have renewed conditional license for the composite cable broadcasting business operators who have the same problems as the following table, and there have been problems such as weak financial structure and low payment of PP receiving fees.

[Reasons for Recognition] Unsatisfy, Gap's entries in Gap's evidence Nos. 34 through 39, 53, and 57, and the purport of the whole pleadings

B) Determination

In addition to the whole purport of the pleadings, the following circumstances revealed in the above facts: ① the defendant's second and fourth grounds for the rejection disposition of this case are not acknowledged as the grounds for the rejection disposition of this case; ② as of the time of the rejection disposition of this case, there are some circumstances that can be taken into account the plaintiff's withdrawal of the submission of supplementary data of this case against the defendant in relation to the ground for the first disposition, and the plaintiff's payment of the unpaid broadcast program fees to the PP business operator in relation to the ground for the third disposition, and there are no additional damages, etc.; ③ the defendant submitted objective materials that can be considered to have improved the plaintiff's financial structure through the method that the related party gives up his claims against the plaintiff; ③ the defendant issued a conditional permission to other CATV broadcasting business operators with similar problems; ④ the defendant can issue a corrective order or order for improvement of facilities when it is deemed that the CATV broadcasting business operator, etc. violates the conditions of the permission of this case; and ④ the defendant's rejection disposition of this case may not be subject to the revocation order or reduction of business suspension of business (the above grounds for rejection disposition).

3. Conclusion

Therefore, the plaintiff's claim is reasonable, and it is so decided as per Disposition.

The judge of the presiding judge;

Judges Cho Jae-chul

Judges Gambling Residents