A court on the 5th found lawful the Defense Acquisition Program Administration's additional security point-deduction measure against HD Hyundai Heavy Industries.
According to the defense industry and legal circles, the Seoul Central District Court's Civil Agreement Division 50 on the afternoon of the same day dismissed an injunction filed by HD Hyundai Heavy Industries seeking to bar additional point deductions in the Korea Destroyer Next Generation (KDDX) program against the Defense Acquisition Program Administration.
Earlier, nine HD Hyundai Heavy Industries employees were found guilty of violating the Military Secret Protection Act after they illegally obtained 12 Navy classified materials, including Daewoo Shipbuilding & Marine Engineering's KDDX concept design drawings in 2013, and shared them through the company's internal network. Eight had their convictions finalized in 2022, and one in 2023. Under the regulations, security point deductions apply for three years from the date the conviction becomes final.
Initially, the Defense Acquisition Program Administration viewed the two rulings as a single case and decided to impose a 1.8-point deduction. After an internal review in September, it concluded they should be treated as separate matters and set a policy to apply an additional 1.2-point deduction through December this year. As controversy grew during the National Assembly audit, the agency, which had previously not commented, said at a hearing on the 2nd that it would impose the deduction on HD Hyundai Heavy Industries.
HD Hyundai Heavy Industries argued that the agency's measure was improper and sought an injunction, but the court did not accept it. In its decision that day, the court said it was difficult to view the debtor (the Defense Acquisition Program Administration) imposing a deduction based on finalized convictions as clearly unfair or unlawful.
It added that the rulings for the eight and the one differ in the actors, timing and method, detection, and the content of the collected military secrets, and that they should be regarded as separate criminal cases, so the debtor (the Defense Acquisition Program Administration) may impose deductions for three years from the date the one-person ruling became final.
An official at the Defense Acquisition Program Administration said the result recognizes the lawfulness and fairness of the security deduction application and evaluation procedures, and added the agency will strictly comply with relevant rules and procedures for objective and fair program management.
KDDX is a program to develop major components such as the hull, combat system, and large integrated mast with domestic technology. It is considered a high-difficulty program that will be the first among domestic warship programs to adopt an integrated electric propulsion system. The goal is to invest 7.8 trillion won to build six 6,000-ton-class destroyers.
KDDX has completed basic design and will proceed with detailed design, lead ship construction, and follow-on ship construction. The KDDX concept design was handled in 2012 by Daewoo Shipbuilding & Marine Engineering (now Hanwha Ocean), and the basic design was later contracted and performed in 2020 by HD Hyundai Heavy Industries. The plan was to begin detailed design and lead ship construction after completing the basic design in Dec. 2023 and from 2024, but the project has been delayed by about two years due to disputes over how to select the contractor.