2013Du26309 Revocation Order, etc.

Co., Ltd.

Fair Trade Commission

Seoul High Court Decision 2012Nu24353 Decided November 8, 2013

January 14, 2016

The judgment below is reversed, and the case is remanded to Seoul High Court.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Article 19(1) of the Monopoly Regulation and Fair Trade Act (hereinafter “Fair Trade Act”) prohibits “agreement on an act of unfairly restricting competition”. The agreement includes not only explicit agreement but also implied agreement. Here, the essence of the agreement lies in the communication between two or more enterprisers. As such, it cannot be deemed that there was an agreement as a matter of course on the ground that there was an external form consistent with the act listed in each subparagraph of the above provision. However, it can be deemed that there was an agreement between the enterprisers, but it can be deemed that there was an agreement where a circumstance to recognize the reciprocity of communication between the enterprisers exists (see Supreme Court Decision 2012Du17421, Nov. 28, 2013, etc.).

In addition, in a case where competitive enterprisers exchange information on major competitive factors, such as prices, the exchange of such information may serve as a means to facilitate or facilitate collusion by removing uncertainty on the decision-making of price, etc., and thus, it cannot be readily concluded that there exists an agreement on an act of unfairly restricting competition among the business entities. However, even so, it cannot be concluded that there exists an agreement on an act of unfairly restricting competition solely based on the information exchange. The determination of whether such an agreement has been reached by comprehensively taking into account all the circumstances, including the structure and characteristics of the relevant market, the nature and contents of the exchanged information, the subject and timing of the information exchange, the purpose and intent of the information exchange, the degree of consistency or difference between the business entities, such as the price and output volume after the information exchange, the process and contents of the decision-making, and other impacts on the market (see Supreme Court Decision 2013Du16951, Jul. 24, 2014).

2. The lower court: (1) based on its adopted evidence,: (a) if the Plaintiff and the Plaintiff were to have a consensus on the necessity of raising the price; (b) if the Plaintiff and the C&C Co., Ltd.; (c) the Korea P&C Co., Ltd. (hereinafter referred to as “F&C”); and (d) the Plaintiff and the Plaintiff et al. were to manufacture and sell C&C; and (c) if the price increase first at the end of December 2000 or at the meeting of representatives held on January 2001 (hereinafter referred to as the “meeting of representatives”); (c) if the price increase first at the meeting of representatives (hereinafter referred to as “the meeting of representatives”), the agreement on the necessity of raising the price is formed; (d) if the agreement was reached on March 28, 2001, the agreement was reached between the Council for Normalization Trade; and (e) if the agreement was reached at the meeting of the Government on the price increase at the general meeting (hereinafter referred to as “the Council for Food and Rural Affairs”).

5. 10. Press: (10) If the price increase was examined from 201: (2) the time and width of the increase was determined at the beginning of the next week; (3) the price increase was determined by both companies including the Plaintiff, as of May 21, 2001; (4) the average price increase by 17 on the container; (3) the price increase by 9.9% on average; and (5) the price increase by 2) the price increase by 322 won on the container (hereinafter referred to as “1 price increase”); (2) the price increase by 330.0 on June 1, 201; and (5) the price increase by 2) the average price increase by 12.0% on the container; and (5) the price increase by 2) the price increase by 20% on the 20.3rd price of the product, other than the 2nd price increase by the Plaintiff.

2. up to six times the price increase shows a strong external appearance. ③ The agricultural trial prior to the price increase during the above period, and other enterprisers have also increased the price thereafter. ④ The Plaintiff et al. has continuously maintained meetings or contact and has formed a consensus on the necessity of price increase. ⑤ The Plaintiff et al. widely exchanged sensitive management information that only executives or employees are able to know, and such exchange of information has been made continuously and repeatedly. ⑥ The agricultural trial increased the price on December 24, 2004 and decided the supported period by the Gu on January 13, 2005 to the effect that the price increase is equal to or lower than 6) price increase, taking into account the fact that there was no explicit or implied declaration of intent to withdraw from the agreement with other enterprisers, the Plaintiff et al. should have determined that the agreement constitutes an identical or similar agreement between the Plaintiff et al. (7) price increase or lower than 6) price increase.

3. However, we cannot accept the judgment of the court below for the following reasons.

A. According to the reasoning of the lower judgment and the record, the following circumstances are revealed. (1) A was a person who was directly present at the meeting of the representative, and a person who was discussed at the meeting of the representative from the network B, and there was no direct evidence including the network B’s statement. (2) The statement written by D was a statement that “I would not raise the price if I would like to talk with the network B who was present at the meeting of the representative, and “I would not want to do so at the meeting of the representative,” and it was stated that I would like to agree to raise the price first at the meeting of the deaf court. (3) In addition, F’s statement and B’s statement were written at the meeting of the representative, “I would not have any special opinion from the network’s meeting,” and that I would like to enter the price for 3 years to 3 years from the meeting of the representative.

(4) The so-called 'IMF remedy finance' was raised by the so-called 'IMF remedy finance' in early 1998, and the price increase was not increased until the time of the representative meeting, despite the increase in expenses, so it seems that it was an issue in the industry if the price increase was made at the time of the representative meeting. (5) On the other hand, if the Council's direct evidence as to the contents discussed at the Council, it is the only G statement that directly attended the meeting and talk about the price increase, etc., and if at the time, the minutes of the Council contain the signatures of other persons than the signature of G, and the power of attorney of G was attached to the general meeting to delegate all voting rights to H at the ordinary meeting. On the other hand, G made a statement at the court below that the power of attorney may not know the reasons attached thereto. On the other hand, if the statement made by the Council on Apr. 1, 2010 and the statement made on Apr. 1, 2010 is not stated.

(6) If the two companies increase the price of the 10th anniversary of the 1980s, including the 1980s, the 2nd 5th m3th m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m2nd m3rd m3rd m3rd m3rd m2nd m2nd m2nd m3rd m2nd m3rd m3rd m3rd m2nd m2nd m2nd m3rd m3rd m3rd m3rd m3rd m2nd m3rd m2nd m3rd m2nd m2nd m.

(9) According to the Plaintiff’s internal sector, it can be confirmed that the time of price increase for up to 2,3 months is delayed compared to the competitor’s price increase and the direction of implementing discriminatory price policies for each product based on industry and consumer trends in around 2007. According to the internal sector of Macuart drawn up around 2004 and 2005, Macuart also has established strategies such as delaying the time of price increase or supporting distribution networks in response to the competitor’s price strategy.

B. We examine the above circumstances in light of the legal principles as seen earlier, as to whether the agreement in this case was concluded.

(1) The statement of D and F, the evidence of the instant agreement 1, is not correct as it is a specialized statement, and the contents discussed in the circumstances of the representative meeting are not accurate. As such, the possibility that if the price was set at the time of the long-term, there is no possibility that the agricultural trial would have led the price increase first, it cannot be ruled out that there was an atmosphere that only would have been reached to the extent that the agricultural trial would have led the price increase first. In addition, there is a difference in the average rate of increase in the price for each company, and in 2001, it is difficult to specify the contents of the agreement in addition to

(2) In addition, since the contents of G, the only direct evidence of the contents discussed at the Council, are likely to not directly experience, credibility is difficult to be fully granted, even if there was an agreement on price increase, it is difficult to view that there was a clear agreement that may affect competition in the long term, and thus, it does not constitute a basis for information exchange in the future. Therefore, it cannot be deemed that there was an agreement on the subsequent information exchange and price increase, and just because there was an agreement on the price increase, it cannot be deemed that there was an implied agreement on the extension of the first agreement, and it cannot be deemed that there was a mere information exchange alone. Thus, the formation of the agreement in this case can be recognized if the mutual recognition of each agreement on price increase is proved with the mere mere information exchange. (4) However, it is sufficiently possible to explain the agreement without premised on the inducement of price increase, etc. as seen next, and it appears that there is a difference in the price increase between the Plaintiff and the Defendant’s act or average increase in the price of each company as well as the two different evidence.

1. ① Since before 2001, there have been long-standing practices in which competitors raise their prices by drilling their prices, and since a group of prices increase in 2001, it would be sufficient to increase their prices by referring to the previous practices if the price is calculated by leading the agricultural trial in accordance with the previous practices. Thus, it is difficult to view that the Plaintiff, etc., etc., had been induced to make a separate agreement with regard to the price increase at least 2 through 6 prices increase.

② While the government has been under de facto control over the price increase but pressure on the cost increase was made, it would be reasonable choice to decide whether a farmer will take the price level that the farmer would have consulted with the government, and the farmer would have sufficiently predicted this point. In addition, considering the long-term practice of the price trend, the farmer is not considered to have reached an agreement with the farmer first because the other party to the consultation on the price increase was a farmer, and thus, the farmer would not have reached the price increase. In addition, considering the long-term practice of the price trend, the farmer is the farmer whose market share reaches 70% after the price increase was successful in 2001. Therefore, it is difficult to deem that there was a need to use the means of "agreement" in order to lead the farmer and other enterprisers to form a price in the form of leading the farmer, and it is also difficult to deem that there was a need to use the means of "agreement".

(3) It is difficult to view that, even as the business entity was the first-class business entity of the market share, with the experience of forming the market share in the agricultural industry, it was difficult to view that the long-term incentive for price collusion, which makes it possible to boost the existing market share.

④ It seems difficult to conclude that an agreement is made to determine the price for each item or to scood an item because the item and type of the product are very diverse. In particular, it cannot be said that there was an agreement between the Plaintiff, etc. on the delivery price of the main source product because the main source product of the cood was not “Wangh”.

⑤ Not only in the case of agriculture and forestry, but also in the case of other enterprisers, if there exists an agreement, such as delaying the time of price increase or providing support to the distribution network by the Gu, in response to the price strategy of a competitor, it may be difficult to see the circumstances. The Gu’s support may be used as a means of maintaining or suppressing collusion, but at the same time, it may be used as a means of active mutual competition as above, and the effect of increasing uncertainty may cause trouble in maintaining collusion. (5) The Plaintiff, etc. exchanged various information, such as long-term price information, and reflected it in their own decision-making, may be deemed to have the effect of restricting competition. However, apart from whether the exchange of information under the Fair Trade Act can be determined as an unfair collaborative act, the exchange of information itself cannot be acknowledged as an agreement on the determination and maintenance of price immediately.

(6) If so, it is difficult to conclude that the agreement of this case or at least the agreement of this case 2 through 6 existed between the plaintiff et al.

4. Nevertheless, the lower court determined otherwise that the agreement of this case 1 and the agreement of this case 2 through 6 was recognized. In so doing, it erred by misapprehending the legal doctrine regarding the establishment of an unfair collaborative act, by exceeding the bounds of the principle of free evaluation of evidence and logical and empirical rules, or by failing to exhaust all necessary deliberations, thereby adversely affecting the conclusion of the judgment. The allegation in the grounds of appeal assigning this error is with merit.

5. Therefore, without further proceeding to decide on the remaining grounds of appeal, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kwon Soon-il

Justices Kim Yong-deok

Justices Park Poe-young

Justices Kim Jae-han