The Korea Trade-Investment Promotion Agency (KOTRA) is under investigation for allegedly favoring a specific company during the evaluation process of a $45 million government project. Reports indicate that KOTRA officials pressured the winning small business to contract with the favored vendor.
On October 12, Representative Choi Soo-jin of the People Power Party analyzed police investigation materials and KOTRA evaluation documents, revealing that three KOTRA executives improperly handled their duties in the bidding process for the $45 million project.
According to the 'Proposal Evaluation Meeting Results' obtained by Choi's office, KOTRA officials participated directly as evaluators and awarded high scores to a preferred company. The score discrepancies between KOTRA officials and external evaluators averaged nine points. Conversely, the winning company, referred to as Company A, received the lowest score from KOTRA officials, as explained by Choi's office.
The police's decision document indicates that the three executives told an executive from Company A shortly after the bidding, "We would like you to work with the company we recommended. Even if you are selected as the preferred bidder, the main contract may not be finalized." They further pressured, stating, "Don't just take the benefits; do what Company B wants. That way, this project can be completed quickly. We all need to eat, right?" The police have referred the three executives to prosecutors on charges of coercion.
Choi's office also noted issues during the project's execution. KOTRA delayed the final approval of the 'main design' for the site development, which is crucial, for about four months, only approving it at the end of December, well past the contract expiration date. Despite the tight timeline, Company A launched a beta service in January of the following year.
However, KOTRA notified Company A of contract termination at the end of January, citing insufficient progress based on its internal audit results. According to Choi's office, Company A requested a review, pointing out errors in the final audit report, but KOTRA did not respond and demanded the full return of the advance payment of 1.356 billion won. Company A, which invested tens of billions of won in labor and development costs, is now facing bankruptcy.
Choi's office claims similar issues have recurred in other projects. In a recently awarded third project, the department that handled the first project allegedly imposed unreasonable service demands on supplier Company C and delayed inspections due to incomplete documentation, threatening contract termination and sanctions against the supplier.
Choi stated, "Using their superior position, KOTRA manipulated bid scores and inserted a colluding company as a subcontractor, delaying the project to conceal this, which has driven small businesses to the brink of bankruptcy. Despite the police investigation revealing these issues, KOTRA's president and audit office have failed to take disciplinary action and provided misleading explanations to the National Assembly." She urged the Ministry of Trade to conduct a thorough special audit immediately and to establish measures to discipline those involved and support the affected small businesses.
* This article has been translated by AI.
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