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FRAMEWORK ACT ON SMALL AND MEDIUM ENTERPRISES

Wholly Amended by Act No. 8360, Apr. 11, 2007

Amended by Act No. 8852, Feb. 29, 2008

Act No. 9184, Dec. 26, 2008

Act No. 10952, Jul. 25, 2011

Act No. 12240, Jan. 14, 2014

Act No. 13865, Jan. 27, 2016

Act No. 14367, Dec. 2, 2016

Act No. 14286, Dec. 2, 2016

Act No. 14839, Jul. 26, 2017

Act No. 15691, jun. 12, 2018

Act No. 15746, Aug. 14, 2018

Act No. 16815, Dec. 10, 2019

Act No. 16954, Feb. 4, 2020

Act No. 17558, Oct. 20, 2020

Act No. 17626, Dec. 8, 2020

 Article 1 (Purpose)
The purpose of this Act is to prescribe basic matters concerning the direction-setting for small and medium enterprises and measures for fostering small and medium enterprises with the aim of supporting their creative and independent growth, improving their industrial structure, and facilitating a balanced development of the national economy.
 Article 2 (Scope of Small and Medium Entrepreneurs)
(1) Small and medium entrepreneurs eligible for such measures for the development of small and medium enterprises (hereinafter referred to as "policy for small and medium enterprises") shall be those who engage in any of the following businesses or cooperatives (hereinafter referred to as "small and medium enterprise"): Provided, That excluded herefrom shall be a member company of a business group subject to disclosure under Article 14 (1) of the Monopoly Regulation and Fair Trade Act or a company deemed included in and notified to a member company of a business group subject to disclosure under Article 14-3 of the same Act: <Amended on Jul. 25, 2011; Jan. 14, 2014; Feb. 3, 2015; Jan. 27, 2016; Aug. 14, 2018; Dec. 10, 2019; Oct. 20, 2020; Dec. 8, 2020>
1. For-profit businesses that meet all of the following requirements:
(a) Sales or total assets, etc. for each industry shall meet the standards set by Presidential Decree;
(b) Actual separation of ownership and management, such as in terms of ownership of shares or an investment relationship, shall meet the standards set by Presidential Decree;
2. Social enterprises prescribed by Presidential Decree, from among those under subparagraph 1 of Article 2 of the Social Enterprise Promotion Act;
3. Cooperatives, federations of cooperatives, social cooperatives, federations of social cooperatives, and federations of other cooperatives (limited to where they have small and medium enterprises prescribed in the subparagraphs of Article 2 (1) of this Act as their members) prescribed by Presidential Decree, from among those under Article 2 of the Framework Act on Cooperatives;
4. Persons prescribed by Presidential Decree, from among cooperatives, federations, and national federations defined in Article 2 of the Consumer Cooperatives Act;
5. Cooperatives, industrial cooperatives, and federations of cooperatives prescribed by Presidential Decree, from among those under Article 3 of the Small and Medium Enterprise Cooperatives Act.
(2) Small and medium enterprises shall be classified into small enterprises and medium enterprises according to the standards for classification, as prescribed by Presidential Decree.
(3) In applying paragraph (1), a small and medium enterprise, which no longer falls within the scope of small and medium enterprises owing to the expansion of its scale, etc., shall be deemed a small and medium enterprise for three years from the year immediately following the year during which such expansion, etc. occurs: Provided, That the foregoing shall not apply where a small and medium enterprise is merged into any company other than a small and medium enterprise or where it no longer falls within the scope of small and medium enterprises on any other ground as specified by the Presidential Decree.
(4) Corporations, organizations, etc. may be treated as small or medium entrepreneurs, as prescribed by the relevant statutes, where deemed particularly necessary in light of the characteristics of each policy for small or medium enterprises. <Amended on Oct. 20, 2020>
 Article 3 (Duties of the Government and Local Governments)
(1) The Government shall establish and implement a fundamental and comprehensive policy for small and medium enterprises, tailored to each beneficiary of support, considering innovative capacity, competitiveness level, and growth potential of small and medium enterprises. <Amended on Jul. 25, 2011>
(2) Each local government shall reflect regional characteristics in establishing and implementing a policy for small and medium enterprises within its jurisdiction in compliance with the policy for small and medium enterprises under paragraph (1).
(3) The Government and local governments shall endeavor to maximize the effectiveness of support for small and medium enterprises through mutual cooperation and interconnectivity with the policy for small and medium enterprises. <Newly Inserted on Jul. 25, 2011>
[Title Amended on Jul. 25, 2011]
 Article 4 (Duties of Small and Medium Entrepreneurs)
(1) Small and medium entrepreneurs shall secure competitiveness through technical development and management innovation and commit themselves to management transparency and corporate social responsibility, thereby contributing to the national economic development and improvement in national welfare.
(2) Small and medium entrepreneurs and persons who have relations with any small and medium enterprise in connection with their business activities shall cooperate with the Government and local governments in implementing the policies for small and medium enterprises.
[This Article Wholly Amended on Jul. 25, 2011]
 Article 4-2 (Overall Control and Coordination of Affairs of Protecting and Fostering Small and Medium Enterprises)
The Minister of SMEs and Startups shall exercise overall control over, and coordinate, the affairs performed by the Government and local governments insofar as such affairs pertain to protecting and fostering small and medium enterprises.
[This Article Newly Inserted on Jun. 12, 2018]
 Article 4-3 (Relationship to Other Statutes)
The enactment or amendment of other statutes to protect or foster small and medium enterprises shall be in conformity with the purposes of this Act.
[This Article Newly Inserted on Jun. 12, 2018]
 Article 5 (Encouragement to Start Business and Spread of Entrepreneurial Spirit)
(1) The Government shall take measures necessary to encourage the establishment of new small and medium enterprises and to help new small and medium entrepreneurs to grow and develop their businesses. <Amended on Jul. 25, 2011>
(2) The Government shall take measures necessary for small and medium entrepreneurs or persons preparing to start a business to have sound entrepreneurial spirit and pride. <Newly Inserted on Jul. 25, 2011>
[Title Amended on Jul. 25, 2011]
 Article 6 (Rationalization of Management and Improvement of Technology)
(1) The Government shall take measures necessary to rationalize the management of small and medium enterprises and upgrade technology and quality, including providing guidance and training programs for business management and technology, promoting technological development, and pursuing standardization.
(2) The Government shall take measures necessary to improve the productivity of small and medium enterprises, including modernizing manufacturing facilities and accelerating informatization.
 Article 7 (Securing Markets)
(1) The Government shall take measures necessary to increase opportunities for small and medium entrepreneurs to receive procurement orders when the Government, local governments, public organizations, Government-invested institutions, etc. procure goods or services.
(2) The Government shall take measures necessary to improve efficiency in distribution, such as modernizing distribution systems, encouraging cooperation in the distribution industry, etc. with the aim of expanding markets for the products manufactured by small and medium enterprises.
 Article 8 (Cooperation between Small and Medium Enterprises)
The Government shall take measures necessary to encourage cooperation between small and medium enterprises, such as inducing small and medium enterprises, etc. to cluster together and cooperate with one another.
 Article 9 (Conversion of Business Structure)
The Government shall take measures necessary to facilitate the incorporation of small and medium enterprises, business conversion, mergers between small and medium enterprises, etc. so that small and medium enterprises can have a more advanced corporate structure.
 Article 10 (Encouragement of Fair Competition and Mutual Growth)
The Government shall take measures necessary to ensure that small and medium enterprises can cooperate, fairly compete with businesses other than small and medium enterprises, and pursue mutual growth.
[This Article Wholly Amended on Jul. 25, 2011]
 Article 11 (Protection of Business Areas)
The Government shall take necessary measures to ensure that small and medium entrepreneurs can smoothly secure their business areas in the fields appropriate for the companies of such size.
 Article 12 (Establishment of Mutual Aid System)
The Government shall take measures necessary to establish a mutual aid system through which small and medium entrepreneurs may be able to help each other to prevent insolvency and lay the foundation for common purchasing and sales activities, etc.
 Article 13 (Organization of Small and Medium Entrepreneurs)
The Government shall take measures necessary to facilitate the formation of organizations, such as small and medium enterprises’ cooperatives, and to rationalize the management of such organizations to enable small and medium entrepreneurs to assist each other in pursuing their growth and development and enhancing their economic status.
 Article 14 (Facilitation of Internationalization)
(1) The Government shall take measures necessary to promote the exportation and importation by small and medium enterprises, cooperation with foreign companies, and the like to encourage them to go global.
(2) The Government shall take such necessary measures as furnishing information about small and medium enterprises so that they may be able to cope actively with changes in the domestic and overseas economic environment.
 Article 15 (Support for Securing Workforce)
The Government shall take measures necessary for small and medium enterprises to stably secure skilled workforce by supplying and training them, improving their working environment and welfare, and improving perception of small and medium enterprises, etc.
[This Article Wholly Amended on Jul. 25, 2011]
 Article 16 (Measures for Small Enterprises)
The Government shall take measures necessary to improve and develop the management of small enterprises.
 Article 17 (Fostering of Local Small and Medium Enterprises)
The Government shall foster small and medium enterprises in rural areas and shall take measures necessary to encourage them to hire females and the disabled.
[This Article Wholly Amended on Jul. 25, 2011]
 Article 18 (Legislative and Fiscal Measures)
The Government shall take legislative and fiscal measures necessary to implement its policy for small and medium enterprises.
 Article 18-2 (Support and Investment to Foster Small and Medium Enterprises)
(1) The Government shall consistently and steadily secure financial resources necessary to foster small and medium enterprises.
(2) The Government shall endeavor to consistently expand support and investment to foster small and medium enterprises.
[This Article Newly Inserted on Jun. 12, 2018]
 Article 19 (Financial and Tax Measures)
(1) The Government shall take measures necessary to ensure smooth funding for small and medium entrepreneurs, such as facilitation of a proper supply of financial resources and establishment of a credit guarantee system.
(2) The Government may provide tax support, as prescribed by the statutes governing taxation, to ensure an efficient implementation of its policies for small and medium enterprises.
 Article 19-2 (Formulation of Comprehensive Plan for Fostering Small and Medium Enterprises)
(1) In order to support the development of creative and independent small and medium enterprises, the Government shall formulate a comprehensive plan for fostering small and medium enterprises (hereinafter referred to as “comprehensive plan”) every three years.
(2) The formulation or modification of a comprehensive plan shall undergo deliberation by the State Council: Provided, that this shall not apply to modification of minor matters prescribed by Presidential Decree.
(3) A comprehensive plan shall include the following matters: <Amended on Jun. 12, 2018>
1. Basic objectives and direction-setting of policies for fostering small and medium enterprises;
2. Improvement of systems and statutes or regulations related to the fostering of small and medium enterprises;
3. Rationalizing management and improving technologies of small and medium enterprises;
4. Securing markets for small and medium enterprises;
5. Promoting cooperation between small and medium enterprises;
6. Building a sophisticated corporate structure of small and medium enterprises;
7. Promoting fair competition and shared growth;
8. Supporting small and medium enterprises in their securing of human resources;
9. Fostering small and medium enterprises located in the regions;
10. Creating a work environment for the hiring and continuous employment of young workforce at small and medium enterprises;
11. Other matters necessary for fostering small and medium enterprises.
(4) Other matters necessary for the formulation and implementation of a comprehensive plan shall be prescribed by Presidential Decree.
[This Article Newly Inserted on Dec. 2, 2016]
 Article 20 (Formulation of Plans for Fostering Small and Medium Enterprises and Submission of Annual Reports)
(1) The Government shall formulate a plan regarding the policies for fostering small and medium enterprises (hereinafter “foster plan”) pursuant to a comprehensive plan, and shall submit such plan, along with relevant budget proposals, to the National Assembly by every March. <Amended on Dec. 2, 2016>
(2) The Minister of SMEs and Startups shall evaluate the performance and outcomes of the previous year’s foster plan, and shall submit an annual report, reflecting the evaluation results, to the National Assembly before its regular session. <Amended on Jul. 26, 2017>
(3) The head of a central administrative agency in charge of formulation of the foster plan under paragraph (1) and the Minister of SMEs and Startups in charge of evaluation under paragraph (2) may request cooperation from the heads of relevant central administrative agencies or relevant local governments. In such cases, the person so requested shall actively comply therewith unless there is a compelling reason not to do so. <Amended on Jul. 26, 2017>
(4) Matters necessary to formulate a foster plan and annual reports shall be prescribed by Presidential Decree.
[This Article Wholly Amended on Jul. 25, 2011]
 Article 20-2 (Establishment and Operation of Integrated Management System for Small and Medium Enterprise Aid Programs)
(1) The Minister of SMEs and Startups may establish and operate an integrated management system for small and medium enterprise aid programs to integrate and manage the data or information on the status of applications filed by small and medium enterprises, receipt thereof, and records of applications for the small and medium enterprise aid programs, and the like (hereinafter referred to as “integrated management system”). <Amended on Jul. 26, 2017>
(2) Where deemed necessary for establishing and operating the integrated management system, the Minister of SMEs and Startups may request the heads of central administrative agencies, local governments, credit information collection agencies, or other relevant agencies and groups (hereinafter referred to as “heads of central administrative agencies, etc.”) to provide each of the following data and information and may possess and use the said data and information to the extent necessary to achieve the intended purpose of such provision: <Amended on Dec. 2, 2016; Jul. 26, 2017; Jun. 12, 2018>
1. Resident registration number under Article 7-2 (1) of the Resident Registration Act for identifying and confirming the small and medium enterprises under Article 2;
2. Credit information under the Credit Information Use and Protection Act;
3. Any of the following taxation information under Article 81-13 of the Framework Act on National Taxes, which is necessary to analyze the effectiveness of support for the enterprises eligible for the policies for small and medium enterprises and whose possession and use are consented to by the person concerned:
(a) Total sales, paid-in capital, total assets, total liabilities, operating profits, net profits for the current period;
(b) Business start date, date of temporary business closure, date of permanent business closure;
(c) The number of persons subject to simplified tax withholding for wage and salary income, as specified in a report on the status of withholding under the Income Tax Act;
4. Information on the certification and verification of the relevant enterprise under statutes or regulations, etc. to analyze the effects of support for companies involved in a policy for small and medium enterprises;
5. Other data and information the Minister of SMEs and Startups deems necessary for the establishment and operation of an integrated management system.
(3) The heads of central administrative agencies, etc. who are requested to provide data or information pursuant to paragraph (2) shall cooperate therewith, except under extenuating circumstances.
(4) The Minister of SMEs and Startups may provide the data and information concerning the integrated management system to the heads of central administrative agencies, etc. who carry out the small and medium enterprise aid programs. <Amended on Jul. 26, 2017>
(5) The Minister of SMEs and Startups shall formulate the policy measures necessary for protecting the data and information possessed and used pursuant to paragraph (2). <Amended on Jul. 26, 2017>
(6) The Minister of SMEs and Startups may establish and operate an organization dedicated to establishing and operating the integrated management system as prescribed by Presidential Decree. <Amended on Jul. 26, 2017>
(7) Other matters necessary for establishing and operating the integrated management system shall be prescribed by Presidential Decree.
[This Article Newly Inserted on Jan. 14, 2014]
 Article 20-3 (Improving Efficiency of Small and Medium Enterprise Aid Programs)
(1) For surveying the current status of, analyzing, assessing, and improving the efficiency of, small and medium enterprise aid programs managed through the integrated management system pursuant to Article 20-2 (1) (hereinafter referred to as “improving efficiency”), the Minister of SMEs and Startups shall implement the following: <Amended on Jul. 26, 2017; Jun. 12, 2018>
1. Formulating standards for setting the scope of, classifying, analyzing, and assessing, small and medium enterprise aid programs;
2. Strengthening the role-sharing and interconnectivity among small and medium enterprise aid programs;
2-2. Surveying the current status of, analyzing, and assessing, small and medium enterprise aid programs;
3. Offering opinions about the system improvement and budget reflection for improving efficiency;
4. Checking redundancy among small and medium enterprise aid programs and preparing measures for improvement thereof;
5. Analyzing performance of institutions or organizations operating small and medium enterprise aid programs upon entrustment;
6. Conducting surveys on satisfaction with small and medium enterprise aid programs;
7. Other matters necessary for improving efficiency.
(2) For improving efficiency, the Minister of SMEs and Startups shall make the most of the data and information of the integrated management system and, if necessary, may request submission of data and information from the head of a central administrative agency, etc. In such cases, the head of a central administrative agency, etc. shall comply therewith unless there is a compelling reason not to do so. <Amended on Jul. 26, 2017; Jun. 12, 2018>
(3) The Minister of SMEs and Startups shall finalize measures for improving efficiency subject to deliberation by the small and medium enterprises policy deliberative council prescribed in Article 20-4, and the head of a central administrative agency, etc. shall reflect such measures in the small and medium enterprise aid programs. <Amended on Jul. 26, 2017; Jun. 12, 2018>
(4) Other matters necessary for improving efficiency shall be prescribed by Presidential Decree. <Newly Inserted on Jun. 12, 2018>
[This Article Newly Inserted on Feb. 3, 2015]
[Title Amended on Jul. 12, 2018]
 Article 20-4 (Small and Medium Enterprises Policy Deliberative Council)
(1) A small and medium enterprises policy deliberative council (hereinafter referred to as “Deliberative Council”) shall be established within the Ministry of SMEs and Startups to deliberate on and coordinate major policies and plans for protecting and fostering small and medium enterprises and implementation thereof.
(2) The Deliberative Council shall deliberate on and coordinate the following matters:
1. Overall operation of policies relating to small and medium enterprises such as formulating major policies and plans for protecting and fostering small and medium enterprises;
2. Matters regarding major policies for protecting and fostering small and medium enterprises, to which at least two central administrative agencies are related;
3. Establishing and implementing comprehensive plans under Article 19-2;
4. Formulating a foster plan for the current year, and assessing the actual results and performance of the foster plan for the preceding year under Article 20;
5. Improving efficiency of small and medium enterprise aid programs under Article 20-3;
6. Coordinating new and amended programs under Article 20-5 (2);
7. Matters regarding systems, statutes and regulations relating to fostering small and medium enterprises;
8. Matters required to be deliberated on or coordinated by the Deliberative Council under other statutes or regulations, and other matters prescribed by Presidential Decree;
9. Other matters referred for deliberation by the chairperson of the Deliberative Council in connection with major policies for protecting and fostering small and medium enterprises.
(3) The Deliberative Council shall be comprised of up to 30 members, including a chairperson.
(4) The Minister of SMEs and Startups shall be the chairperson and the following persons shall be members of the Deliberative Council:
1. Vice Ministers of relevant central administrative agencies prescribed by Presidential Decree or vice minister-level officials;
2. Persons commissioned by the Minister of SMEs and Startups from among persons who have abundant knowledge of and experience in areas such as small and medium enterprises, economy and industry.
(5) The chairperson shall represent the Deliberative Council, and preside over the affairs thereof.
(6) A working-level coordination committee shall be established to efficiently support consultation over the agenda items referred to the Deliberative Council under each subparagraph of paragraph (2);
(7) The working-level coordination committee may have subcommittees for expert review on matters under its jurisdiction.
(8) Except as provided in paragraph (1) through (7), matters necessary for composing and operating the Deliberative Council, the working-level coordination committee, and subcommittees and other necessary matters shall be prescribed by Presidential Decree.
[This Article Newly Inserted on Jun. 12, 2018]
 Article 20-5 (Consultation and Coordination)
(1) Where the head of a central administrative agency and the head of a local government establishes or amends a small and medium enterprise aid program, he/she shall consult with the Minister of SMEs and Startups with respect to, among other things, the feasibility of the establishment or amendment, whether the new or amended program overlaps with the existing one, effects on the delivery system such as selection of beneficiaries and operation methods, as prescribed by Presidential Decree.
(2) Where consultation prescribed in paragraph (1) is not conducted, the Deliberative Council shall coordinate such consultation.
(3) Matters necessary for consulting on establishing or amending a small and medium enterprise aid program shall be prescribed by Presidential Decree.
[This Article Newly Inserted on Jun. 12, 2018]
 Article 21 (Fact-Finding Surveys on Small and Medium Enterprises)
(1) The Government shall conduct an annual fact-finding survey to understand the current status of small and medium enterprises, in terms of their activities, funds, human resources, management, etc. and shall announce the results thereof. In such cases, the Government shall, if necessary to deal with an issue which is similar or related to the fact-finding survey in question, carry out an integrated survey by combining each of the following surveys: <Amended on Jan. 28, 2015; Feb. 4, 2020>
1. Fact-finding surveys on human resources at small and medium enterprises under Article 7 of the Special Act on Support for Human Resources of Small and Medium Enterprises;
5. Other fact-finding surveys prescribed by Presidential Decree.
(2) The Government may entrust the Korea Federation of SMEs, or any organization or institution related to small and medium enterprises, with the task of conducting fact-finding surveys referred to in paragraph (1).
(3) The Government may, if necessary for the fact-finding surveys under paragraph (1), request small and medium entrepreneurs or related organizations to cooperate by submitting data or stating their opinions, etc. In such cases, small and medium entrepreneurs or related organizations so requested shall comply therewith unless there is a compelling reason not to do so.
(4) Matters regarding the methods and procedures of the fact-finding surveys under paragraph (1) shall be prescribed by Presidential Decree.
[This Article Wholly Amended on Dec. 26, 2008]
 Article 22 (Establishment of Ombudsman Program for Small and Medium Enterprises)
(1) The Ombudsman program for small and medium enterprises shall be established under the Minister of SMEs and Startups to improve existing regulations that affect the management of small and medium enterprises and to address the difficulties facing small and medium enterprises. <Amended on Aug. 6, 2013; Jul. 26, 2017>
(2) The Ombudsman for small and medium enterprises shall independently carry out each of the following: <Newly Inserted on Aug. 6, 2013>
1. Identifying and improving regulations that affect small and medium enterprises;
2. Resolving difficulties arising in connection with the Government and local governments, public institutions prescribed in Article 4 of the Act on the Management of Public Institutions, and the policy funds management institutes for small and medium enterprises (hereinafter referred to as “administrative institute”);
3. Other affairs prescribed by Presidential Decree which are required to improve related regulations and to resolve the difficulties facing small and medium enterprises.
(3) The Ombudsman for small and medium enterprises shall be commissioned by the Prime Minister, upon recommendation of the Minister of SMEs and Startups from among persons with extensive knowledge of and experience in the fields of small and medium enterprises and regulations and deliberation by the Regulatory Reform Committee under Article 23 of the Framework Act on Administrative Regulations (hereinafter referred to as "Regulatory Reform Committee"). <Amended on Aug. 6, 2013; Jul. 26, 2017>
(4) The Ombudsman for small and medium enterprises shall prepare a report on his or her activities as an ombudsman and present it to the Regulatory Reform Committee, the State Council, and the National Assembly, by the end of every January. <Amended on Aug. 6, 2013>
(5) Articles 30 and 32 of the Framework Act on Administrative Regulations shall apply mutatis mutandis to investigations related to the execution of duties by the Ombudsman for small and medium enterprises, opinion hearings, legal status, etc. In such cases, "committee" or "committee members" shall be respectively construed as "Ombudsman for small and medium enterprises." <Amended on Aug. 6, 2013>
(6) Where it is found necessary after carrying out the affairs under paragraph (2), the Ombudsman for small and medium enterprises may recommend that the head of the relevant administrative institute improve the matters at issue. <Newly Inserted on Aug. 6, 2013>
(7) The Ombudsman for small and medium enterprises may review the execution status of the improvements following the recommendation made under paragraph (6), and where an administrative institute fails to implement the recommendation without good cause, the Ombudsman may publicly announce the details, etc. of such non-compliance. <Newly Inserted on Aug. 6, 2013>
(8) To assist the Ombudsman for small and medium enterprises in handling his or her duties and performing activities, a secretariat office shall be established within the Ministry of SMEs and Startups. <Newly Inserted on Aug. 6, 2013; Jul. 26, 2017>
(9) Matters necessary for the establishment, operation, etc. of the Ombudsman program shall be prescribed by Presidential Decree. <Amended on Aug. 6, 2013>
[This Article Newly Inserted on Dec. 26, 2008]
[Title Amended on Aug. 6, 2013]
 Article 23 (Presentation of Opinions)
(1) Small and medium entrepreneurs, interested parties, or the heads of any relevant organizations may present their opinions to the Ombudsman for small and medium enterprises regarding the affairs referred to in Article 22 (2). In such cases, Article 17 of the Framework Act on Administrative Regulations and Article 44 of the Administrative Procedures Act shall apply mutatis mutandis to the methods of presenting opinions and procedures for dealing therewith. <Amended on Jul. 25, 2011; Aug. 6, 2013>
(2) Administrative agencies related to the presentation of opinions under paragraph (1) shall not put a person who has presented his or her opinions regarding the improvement of regulations at a disadvantage or discriminate against him or her. <Amended on Jul. 25, 2011>
(3) If a person who presented opinions under paragraph (1) files a petition, complaining that he or she has suffered a disadvantage or discrimination by the relevant administrative agencies due to the fact that he or she presented opinions, the Ombudsmen for small and medium enterprises may raise a grievance to Anti-Corruption and Civil Rights Commission on his or her behalf. <Newly Inserted on Jul. 25, 2011>.
(4) Where a public official-in-charge, etc. is subject to any disciplinary action for any violation committed in the course of performing his or her duties to improve regulations, the Ombudsmen for small and medium enterprises may propose that the disciplinary authority mitigate, or grant immunity from, the disciplinary actions. <Newly Inserted on Aug. 6, 2013>
[This Article Newly Inserted on Dec. 26, 2008]
[Title Amended on Jul. 25, 2011]
 Article 24 (Administrative Assistance)
(1) The Minister of SMEs and Startups may, if deemed necessary to support the operation of the Ombudsman for small and medium enterprises, request the State agencies, local governments, public institutions under Article 4 of the Act on the Management of Public Institutions or related corporations or organizations to dispatch public officials or staff under their jurisdiction. <Amended on Jul. 26, 2017>
(2) The Minister of SMEs and Startups may provide administrative or financial assistance necessary for the operation of the Ombudsman programs for small and medium enterprises under paragraph (1). <Amended on Jul. 26, 2017>
[This Article Newly Inserted on Dec. 26, 2008]
 Article 25 (Designation of Specialized Research and Assessment Institutes)
(1) The Minister of SMEs and Startups may designate and operate a specialized research and assessment institute performing survey, research, and assessment necessary for, among other purposes, formulating policies for small and medium enterprises (hereinafter referred to as “specialized research and assessment institute”). <Amended on Jul. 26, 2017; Jun. 12, 2018>
(2) The Minister of SMEs and Startups may contribute to or subsidize the specialized research and assessment institute within budgetary limits, so as to help the institute to cover expenses incurred in conducting the survey, research, and assessment. <Amended on Jul. 26, 2017; Jun. 12, 2018>
(3) Necessary matters regarding standards and procedures for designating specialized research and assessment institutes, and the operation, etc. thereof shall be prescribed by Presidential Decree. <Amended on Jun. 12, 2018>
[This Article Newly Inserted on Jul. 25, 2011]
[Title Amended on Jul. 12, 2018]
 Article 25-2 (Establishment of the Korea SMEs and Startups Institute)
(1) The Government shall establish the Korea SMEs and Startups Institute (hereinafter referred to as the "Institute") to conduct surveys, research, education, and evaluation necessary for the formulation, etc. of policies related to small and medium enterprises and venture businesses (referring to the venture business defined in Article 2 (1) of the Act on Special Measures for the Promotion of Venture Businesses; hereinafter the same shall apply).
(2) The Institute shall be a juristic person.
(3) The Institute shall have executive officers and employees, as prescribed by its articles of incorporation.
(4) The Government may provide funds or subsidies to cover expenses incurred in the operation, etc., of the Institute, within budgetary limits.
(5) The Institute shall perform the following projects to achieve its purpose of establishment:
1. Research, studies, and policy suggestions for fostering and developing small and medium enterprises and venture businesses;
2. Analysis, evaluation, and education of policies for supporting small and medium enterprises and venture businesses;
3. Projects for exchanges and research cooperation with domestic and foreign research institutes, international organizations, and non-governmental organizations;
4. Entrustment of research projects by the Government, domestic and foreign public institutions, etc.;
5. Generation and analysis of information on policies and statistics related to small and medium enterprises and venture businesses;
6. Publication and publicity of the outcomes of research and studies;
7. Counselling on, consultation for, and provision of information on the management, etc. of small and medium enterprises and venture businesses;
8. Other projects incidental to the projects under subparagraphs 1 through 7 and projects necessary to achieve the purposes of establishing the Institute.
(6) Except as provided in this Act and the Act on the Management of Public Institutions, the provisions of the Civil Act governing incorporated foundations shall apply mutatis mutandis to the Institute.
(7) No person, other than the Institute under this Act, shall use the name “the Korea SMEs and Startups Institute” or any similar name.
(8) The Minister of SMEs and Startups shall direct and supervise the business affairs of the Institute.
[This Article Newly Inserted on Dec. 8, 2020]
 Article 26 (Small and Medium Enterprises Week)
For the purpose of encouraging pride among small and medium entrepreneurs and increasing national awareness of their role and importance in the national economy, one week of each year shall be designated as a week for small and medium enterprises.
[This Article Newly Inserted on Jul. 25, 2011]
 Article 27 (Presentation of Verification Documents)
(1) A small and medium entrepreneur who intends to benefit from the policy for small and medium enterprises shall present a document verifying whether he or she is qualified as a small and medium entrepreneur under Article 2 to central administrative agencies or local governments which implement such policy (hereinafter referred to as “Administration of the Policy for Small and Medium Enterprises”).
(2) The Minister of SMEs and Startups may, where deemed necessary to verify whether he or she is qualified as a small and medium entrepreneur under Article 2, request relevant central administrative agencies, such as the Financial Services Commission and the National Tax Service, local governments, or public organizations to present documents for the verification. <Amended on Jul. 26, 2017>
(3) Where the Minister of SMEs and Startups requests submission of a tax report from the Commissioner of the National Tax Service under paragraph (2), the Administrator shall specify the following in writing: <Amended on Jul. 26, 2017>
1. The number of regular workers;
2. Sales amount;
3. Paid-in capital, capital surplus;
4. Equity capital (total assets ? total debt);
5. Total assets;
6. Current shareholder status and current status of investments in other corporations.
(4) A person requested to submit materials under paragraph (2) or (3) shall comply therewith unless there is a compelling reason not to do so.
[This Article Newly Inserted on Jul. 25, 2011]
 Article 28 (Administrative Fines)
(1) A person who is not a small and medium entrepreneur prescribed in Article 2 but benefitted from the policy for small and medium enterprises by submitting false documents under Article 27 (1) shall be subject to an administrative fine of not more than five million won.
(2) A person who uses the name “the Korea SMEs and Startups Institute” or any similar name, in violation of Article 25-2 (7), shall be subject to administrative fines not exceeding one million won. <Amended on Dec. 8, 2020>
(3) Administrative fines prescribed in paragraphs (1) and (2) shall be imposed and collected by the following persons, as prescribed by Presidential Decree: <Amended on Dec. 8, 2020>
1. The head of the Administration of the Policy for Small and Medium Enterprises: Administrative fines provided in paragraph (1).
2. The Minister of SMEs and Startups: Administrative fines provided in paragraph (2).
[This Article Newly Inserted on Jul. 25, 2011]
ADDENDA <Act No. 8360, Apr. 11, 2007>
(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation.
(2) (Relationship to other Statutes or Regulations) Any citation of the previous Framework Act on Small and Medium Enterprises or any provisions thereof by any other statutes or regulations as at the time this Act enters into force, if any, shall be deemed to be a citation of this Act or corresponding provisions hereof in lieu of the previous provisions, if such corresponding provisions exist herein.
ADDENDA <Act No. 8852, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided, That the amendments to the Acts amended pursuant to Article 5 of the Addenda, which were promulgated before this Act enters into force but the enforcement dates of which have not yet arrived, shall enter into force on the enforcement dates of the respective Acts.
Articles 2 through 7 Omitted.
ADDENDUM <Act No. 9184, Dec. 26, 2008>
This Act shall enter into force three months after the date of its promulgation.
ADDENDUM <Act No. 10952, Jul. 25, 2011>
This Act shall enter into force six months after the date of its promulgation.
ADDENDUM <Act No. 12007, Aug. 6, 2013>
This Act shall enter into force six months after the date of its promulgation.
ADDENDUM <Act No. 12240, Jan. 14, 2014>
This Act shall enter into force three months after the date of its promulgation.
ADDENDA <Act No. 13086, Jan. 28, 2015>
Article 1 (Enforcement Date)
This Act shall enter into force on May 28, 2015. (Proviso Omitted.)
Articles 2 through 8 Omitted.
ADDENDA <Act No. 13157, Feb. 3, 2015>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures concerning Scope of Small and Medium Enterprises)
Where a small and medium enterprise under the previous provisions as at the time this Act enters into force no longer falls under the category of small and medium enterprises under the amended provisions of Article 2 (1) 1 (a), it shall be deemed a small and medium enterprise until March 31, 2018, notwithstanding the amended provisions.
ADDENDUM <Act No. 13865, Jan. 27, 2016>
This Act shall enter into force three months after the date of its promulgation.
ADDENDA <Act No. 14286, Dec. 2, 2016>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation: Provided, That ... <omitted> ... paragraphs (1) and (3) of Article 3 of the Addenda shall enter into force on May 30, 2017.
Articles 2 and 3 Omitted.
ADDENDUM <Act No. 14367, Dec. 2, 2016>
This Act shall enter into force on January 1, 2017.
ADDENDA <Act No. 14839, Jul. 26, 2017>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided, That the amendments to the Acts amended pursuant to Article 5 of the Addenda, which were promulgated before this Act enters into force but the enforcement dates of which have not yet arrived, shall enter into force on the enforcement dates of the respective Acts.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 15691, Jun. 12, 2018>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided, That the amended provisions of Articles 20-3 through 20-5 and 25 shall enter into force six months after the date of its promulgation.
Article 2 (Transitional Measures concerning Establishment of Comprehensive Plans and Foster Plans)
Comprehensive plans and foster plans that have been established under the previous provisions as at the time this Act enters into force shall be deemed to have been deliberated or coordinated by the Deliberative Council under the amended provisions of Article 20-4 (2).
ADDENDUM <Act No. 15746, Aug. 14, 2018>
This Act shall enter into force six months after the date of its promulgation.
ADDENDUM <Act No. 16815, Dec. 10, 2019>
This Act shall enter into force six months after the date of its promulgation.
ADDENDA <Act No. 16954, Feb. 4, 2020>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 8 Omitted.
ADDENDUM <Act No. 17558, Oct. 20, 2020>
This Act shall enter into force six months after the date of its promulgation.
ADDENDA <Act No. 17626, Dec. 8, 2020>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Transitional Measures following Establishment of the Korea SMEs and Startups Institute)
(1) The Korea Small Business Institute established as an incorporated foundation pursuant to the Civil Act as at the time this Act enters into force (hereinafter referred to as the "Korea Small Business Institute as an incorporated foundation"), shall be deemed the Korea SMEs and Startups Institute established pursuant to the amended provisions of Article 25-2.
(2) When the Korea SMEs and Startups Institute under this Act completes its registration of incorporation, notwithstanding the provisions on the dissolution and liquidation of juristic persons in the Civil Act, the Korea Small Business Institute as an incorporated foundation shall be deemed dissolved.
(3) The Korea SMEs and Startups Institute under this Act shall succeed to all the property, rights, and obligations of the Korea Small Business Institute as an incorporated foundation on the date of its registration of incorporation.
(4) The name of the Korea Small Business Institute as an incorporated foundation indicated in the register concerning the property, rights, and obligations comprehensively succeeded to pursuant to paragraph (3) or in other official books shall be deemed the name of the Korea SMEs and Startups Institute under this Act.
(5) Acts conducted by or towards the Korea Small Business Institute as an incorporated foundation as at the time this Act enters into force shall be deemed acts conducted by or towards the Korea SMEs and Startups Institute under this Act.
(6) The executive officers and employees of the Korea Small Business Institute as an incorporated foundation including its chairperson as at the time this Act enters into force shall be deemed the executive officers and employees of the Korea SMEs and Startups Institute under this Act, and the term of office of executive officers shall be counted from the date of the previous appointment.