The German government, having promised to purchase masks in large quantities at high prices during the early spread of COVID-19, now faces the risk of compensating mask manufacturers with over 3 trillion won.
According to local media such as the daily Die Welt on the 24th (local time), the number of lawsuits filed by mask manufacturers against the German Ministry of Health demanding payment for masks reaches about 100 cases. The total amount of claims is approximately 2.3 billion euros (about 3.4 trillion won).
Earlier, in March 2020, during the early spread of COVID-19, the German government signed contracts guaranteeing to purchase FFP-2 masks (Korea's KF-94) at 4.5 euros (about 6,700 won) per mask with many suppliers hoping to deliver.
At that time, the government set the delivery deadline as April 30, 2020. Some companies failed to deliver within this period or their quality did not meet the standards, so they did not receive payment. Consequently, they filed lawsuits against the government.
The problem is that on the 21st, the Cologne Higher Regional Court ruled in a lawsuit filed by one company that the contract clause stating that if delivery was even one day late, the contract would be void and payment would not be made, was invalid.
The court judged that since the companies could face disadvantages in unfavorable situations, the government should have allowed a grace period to receive goods a little late or to improve quality.
This court ruling is expected to influence lawsuits from other companies as well. According to the mask industry, when including accumulated interest and litigation costs over the past four years, the cost the government must bear approaches 3.5 billion euros (about 5.2 trillion won).
There are also criticisms that the German government overestimated the necessary mask quantities during the COVID-19 pandemic. The government spent 5.9 billion euros (about 8.8 trillion won) to purchase 5.7 billion masks, but only 1.7 billion masks were used.
The Federal Audit Office estimated that the cost of managing the remaining masks alone is 400 to 500 million euros (about 600 billion to 740 billion won) per year.
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