ACT ON THE PROMOTION OF MUTUALLY BENEFICIAL COOPERATION BETWEEN LARGE ENTERPRISES AND SMALL AND MEDIUM ENTERPRISES
Act No. 7864, Mar. 3, 2006
Amended by Act No. 8108, Dec. 28, 2006
Act No. 8454, May 17, 2007
Act No. 8852, Feb. 29, 2008
Act No. 9013, Mar. 28, 2008
Act No. 9331, Jan. 7, 2009
Act No. 9978, Jan. 27, 2010
Act No. 10252, Apr. 12, 2010
Act No. 11173, Jan. 17, 2012
Act No. 12002, Aug. 6, 2013
Act No. 12307, Jan. 21, 2014
Act No. 12498, Mar. 18, 2014
Act No. 13839, Jan. 27, 2016
Act No. 13732, Apr. 7, 2016
Act No. 14529, Jan. 17, 2017
Act No. 14775, Apr. 18, 2017
Act No. 14839, Jul. 26, 2017
Act No. 15081, Nov. 28, 2017
Act No. 15519, Mar. 20, 2018
Act No. 15687, jun. 12, 2018
Act No. 16168, Dec. 31, 2018
Act No. 16172, Dec. 31, 2018
Act No. 16290, Jan. 15, 2019
Act No. 16996, Feb. 11, 2020
Act No. 17555, Oct. 20, 2020
Act No. 17799, Dec. 29, 2020
Act No. 18431, Aug. 17, 2021
Act No. 18512, Oct. 19, 2021
Act No. 18661, Dec. 28, 2021
Act No. 19176, Jan. 3, 2023
Act No. 19989, Jan. 9, 2024
CHAPTER I GENERAL PROVISIONS
The purpose of this Act is to sharpen the competitiveness of large enterprises and small and medium enterprises by consolidating mutually beneficial cooperation between them and to attain their shared growth by resolving the polarization between large enterprises and small and medium enterprises with the aim of laying the foundation for sustainable growth of the national economy.
[This Article Wholly Amended on Jan. 27, 2010]
The terms used in this Act are defined as follows: <Amended on Jan. 17, 2012; Mar. 23, 2013; Jul. 26, 2017; Mar. 20, 2018; Jan. 15, 2019; Oct. 19, 2021; Jan. 3, 2023; Jun. 20, 2023>
| 2. | The term "large enterprises" means enterprises that are not small and medium enterprises; |
| 3. | The term "mutually beneficial cooperation" means joint activities carried out between large enterprises and small and medium enterprises, between small and medium enterprises, or between commissioning enterprises and commissioned enterprises to increase their mutual interests in sectors of technology, human resources, fund, purchase, marketing, etc.; |
| 4. | The term "transaction effected on consignment and commission" means a trade in which anyone who runs business of manufacture, construction work, processing, repair, sales, or services commissions the manufacture, construction work, processing, repair, services, or technology development (hereinafter referred to as "manufacture") of goods, parts, semi-finished goods, raw materials, etc. (hereinafter referred to as "goods, etc.") to any other small-medium enterprise and the commissioned small-medium enterprise manufactures the goods, etc. in a specialized manner; |
| 5. | The term "commissioning enterprise" means anyone who commissions pursuant to subparagraph 4; |
| 6. | The term "commissioned enterprise" means anyone who is commissioned pursuant to subparagraph 4; |
| 8. | The term "payment replacing bills" means that a commissioning enterprise pays the price of delivered goods by means of an exclusive-use card for business purchase, loan against security of credit sales claims, and purchase loan system under Article 7-2 (3) 5 through 7 of the Restriction of Special Taxation Act and other means of payment used as a substitute for bills, which are prescribed by Presidential Decree; |
| 8-2. | The term "mutually-beneficial settlement" means that a commissioning enterprise or commissioned enterprise pays the price of delivered goods by means of accounts receivable which meet each of the following requirements: |
| (a) | A commissioned enterprise must be able to issue new accounts receivable to another commissioned enterprise to pay the price of delivered goods, by pledging as security the accounts receivable it has received from a commissioning enterprise for the price of delivered goods; |
| (b) | Subordinate commissioned enterprises at multiple levels must be able to pay the price of delivered goods, using accounts receivable with the same interest rate as accounts receivable issued by a commissioning enterprise; |
| (c) | An agreement must be concluded to the effect that a financial institution is not entitled to exercise the right of recourse against a commissioned enterprise, in relation to the accounts receivable; |
| (d) | The accounts receivable must be withdrawn in cash from a separately designated exclusive deposit account and redeemed when the maturity date arrives, as prescribed by Presidential Decree; |
| 8-3. | The term "mutually-beneficial settlement by central government agencies and local governments" means that central government agencies under Article 6 of the National Finance Act and local governments under Article 2 of the Local Autonomy Act (including offices of education of the Special Metropolitan City, a Metropolitan City, a Special Self-Governing City, a Do, or a Special Self-Governing Province under the Local Education Autonomy Act) pay the price of delivered goods under 22 (6) by means of mutually-beneficial settlement to facilitate cooperation between the public sector and small and medium enterprises; |
| 9. | The term "technical data" means the method of manufacturing or producing goods, etc., and other data useful for business activities and have independent economic value, which are prescribed by Presidential Decree; |
| 10. | The term "shared growth index" means a quantitative indicator developed by evaluating the degree of shared growth between large enterprises and small and medium enterprises to promote their shared growth; |
| 11. | The term "business types and items suitable for small and medium enterprises (hereinafter referred to as "suitable type of business") means business types and items for which it is appropriate to operate business in the form of small and medium enterprises through reasonable division of roles between large enterprises and small and medium enterprises to promote managerial stabilization of small and medium enterprises; |
| 12. | The term "major raw materials" means raw materials used to manufacture goods, etc. in transactions effected on consignment and commission, which account for at least 10/100 of the price of delivered goods; |
| 13. | The term "linkage of the price of delivered goods" means adjusting the price of delivered goods in proportion to the fluctuation, where the price of major raw materials changes between a commissioning enterprise and a commissioned enterprise by at least the agreed ratio not exceeding 10/100. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 3 (Basic Direction of Policies to Facilitate Mutually Beneficial Cooperation between Large Enterprises and Small-Medium Enterprises) |
The Government shall develop and implement policies to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises according to the basic direction set forth in the following subparagraphs:
| 1. | Guaranteeing the autonomy in mutually beneficial cooperation between large enterprises and small and medium enterprises; |
| 2. | Facilitating mutually beneficial cooperation which contributes to the mutual interests of large enterprises and small and medium enterprises; |
| 3. | Enhancing the public sector's leading role in cooperation between public institutions and small and medium enterprises. |
[This Article Wholly Amended on Jan. 27, 2010]
CHAPTER II DEVELOPMENT AND IMPLEMENTATION OF PLANS TO FACILITATE MUTUALLY BENEFICIAL COOPERATION BETWEEN LARGE ENTERPRISES AND SMALL AND MEDIUM ENTERPRISES
| Article 4 (Development of Master Plans to Facilitate Mutually Beneficial Cooperation between Large Enterprises and Small-Medium Enterprises) |
| (1) | The Minister of SMEs and Startups shall develop a master plan to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises (hereinafter referred to as "master plan") after having a consultation with the heads of relevant central administration agencies every three years. <Amended on Jan. 27, 2010; Mar. 23, 2013; Jul. 26, 2017> |
| (2) | A master plan shall include the following matters: <Amended on Dec. 27, 2010; Jan. 18, 2017> |
| 1. | The basic direction setting of policies for facilitating mutually beneficial cooperation between large enterprises and small and medium enterprises; |
| 2. | Annual objectives of mutually beneficial cooperation between large enterprises and small and medium enterprises; |
| 3. | Matters to facilitate the sharing of achievements and exchange of technology and human resources between large enterprises and small and medium enterprises; |
| 4. | Matters concerning selection of and support for exemplary mutually beneficial cooperation enterprises; |
| 5. | Matters concerning narrowing the salary gap between large enterprises and small and medium enterprises; |
| 6. | Matters concerning cooperation of public institutions with small and medium enterprises; |
| 7. | Matters concerning nurturing and supporting small and medium enterprises engaging in suitable types of business; |
| 8. | Other matters necessary to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises. |
| (3) | Deleted. <Jan. 7, 2009> |
| (4) | When it is deemed necessary to develop the master plan, the Minister of SMEs and Startups may request the heads of relevant central administration agencies and institutions or organizations related to mutually beneficial cooperation between large enterprises and small and medium enterprises to submit necessary material and present their opinions, etc. Upon receipt of such request, the heads of relevant central administration agencies and the institutions or organizations related to mutually beneficial cooperation between large enterprises and small and medium enterprises shall comply therewith in the absence of special circumstances. <Amended on Jan. 27, 2010; Mar. 23, 2013; Jul. 26, 2017> |
[Title Amended on Jan 27, 2010]
| Article 5 (Development of Implementation Plans to Facilitate Mutually Beneficial Cooperation between Large Enterprises and Small-Medium Enterprises) |
| (1) | The heads of the relevant central administration agencies shall develop and implement a plan to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises (hereinafter referred to as "implementation plan") according to the master plan each year. |
| (2) | The heads of the relevant central administration agencies shall submit the performance records of the implementation plan of the preceding year and the implementation plan of the current year to the Minister of SMEs and Startups each year, as prescribed by Presidential Decree, and the Minister of SMEs and Startups shall evaluate the performance records based on the implementation plan each year. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (3) | The heads of the relevant central administration agencies may provide support necessary to execute the implementation plan. |
| (4) | Matters necessary for the development and implementation of the implementation plan and the evaluation of the performance records thereof shall be prescribed by Presidential Decree. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 6 Deleted. <Jan. 7, 2009> |
| Article 7 Deleted. <Jan. 7, 2009> |
CHAPTER III PROMOTION OF POLICIES TO FACILITATE MUTUALLY BENEFICIAL COOPERATION BETWEEN LARGE ENTERPRISES AND SMALL-MEDIUM ENTERPRISES
| Article 8 (Fair Distribution of Results of Mutually Beneficial Cooperation) |
| (1) | The Government may develop and implement policies to disseminate a contract model (hereinafter referred to as "win-win model") under which commissioning enterprises support commissioned enterprises to attain their common and agreed goals, including the cost-cutting, etc. and both commissioned and commissioning enterprises share the results. In such cases, the scope of commissioned enterprises shall include middle-standing enterprises defined in subparagraph 1 of Article 2 of the Special Act on the Promotion of Growth and the Strengthening of Competitiveness of Middle-Standing Enterprises, notwithstanding subparagraph 6 of Article 2. <Amended on Aug. 6, 2013; Jan. 21, 2014> |
| (2) | The Minister of SMEs and Startups may establish the promotion headquarters for the distribution of the win-win model (hereinafter referred to as "promotion headquarters") in each of the corporations or organizations prescribed by Ordinance of the Ministry of SMEs and Startups in order to support the distribution of the win-win model. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (3) | The promotion headquarters shall conduct projects falling under each of the following: |
| 1. | Research and survey of the win-win model; |
| 2. | Finding out and distributing exemplary cases in Korea and overseas; |
| 3. | Providing education and consulting for enterprises adopting the win-win model; |
| 4. | Other matters necessary to disseminate the win-win model. |
| (4) | The Minister of SMEs and Startups may provide the promotion headquarters with necessary support to implement projects referred to in each subparagraph of paragraph (3). <Amended on Mar. 23, 2013; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 9 (Facilitation of Technological Cooperation between Large Enterprises and Small-Medium Enterprises) |
| (1) | In order to facilitate technological cooperation between large enterprises and small and medium enterprises, the Government may subsidize funds necessary to develop technologies jointly by large enterprises and small and medium enterprises, or develop the technology which requires the cooperation of large enterprises, such as a purchase agreement of large enterprises, etc. |
| (2) | The Minister of SMEs and Startups may provide necessary support, such as in terms of budget, etc., to technology transaction institutions provided for in Article 10 of the Technology Transfer and Commercialization Promotion Act in order to facilitate the transfer of patent rights and utility model rights of large enterprises that remain unexercised to small and medium enterprises. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 10 (Expansion of Exchange of Human Resources between Large Enterprises and Small-Medium Enterprises) |
| (1) | The Government shall develop and implement policies to facilitate the exchange of human resources between large enterprises and small and medium enterprises. |
| (2) | The Government may subsidize part of labor costs if it is necessary for facilitating the exchange of human resources between large enterprises and small and medium enterprises. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 11 (Capital Participation of Large Enterprises in Small-Medium Enterprises) |
| (1) | If it is necessary to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises to the extent of not impeding the autonomous management of small and medium enterprises, the Government may develop and implement plans which permit large enterprises to make capital participation in small and medium enterprises. |
| (2) | The Government may subsidize the issuance of asset-backed securities, etc. provided for in subparagraph 4 of Article 2 of the Asset-Backed Securitization Act in order to support the management of commissioned enterprises, including technological development, investment in facilities, etc. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 12 (Facilitation of Cooperation between Large Enterprises and Small-Medium Enterprises in Environmental Management) |
| (1) | The Government may develop and implement plans to facilitate the exchange of technology and information and the cooperation therein between large enterprises and small and medium enterprises in order to spread to small and medium enterprises the environmental management referred to in subparagraph 5 of Article 2 of the Act on the Promotion of the Conversion into Environment-Friendly Industrial Structure and to enhance responsiveness to international environmental regulations. |
| (2) | The Government may develop plans to facilitate cooperation between large enterprises and small and medium enterprises in their informatization and their exchange of technology and information, etc. and provide necessary support therefor. |
| (3) | The Government may provide necessary support to facilitate cooperation between large enterprises and small and medium enterprises in expanding markets for goods manufactured by small and medium enterprises, including joint marketing between large enterprises and small and medium enterprises. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 13 (Special Cases concerning Prohibition on Unfair Trade Practices) |
Where any large enterprise supports small and medium enterprises according to reasonable standards made public in advance by the relevant large enterprise as prescribed by Presidential Decree in order to facilitate mutually beneficial cooperation between large enterprises and small and medium ones, such support shall not be deemed to constitute an unfair trade practice provided for in Article 45 (1) 9 of the Monopoly Regulation and Fair Trade Act. <Amended on Feb. 11, 2020; Dec. 29, 2020> [This Article Wholly Amended on Jan. 27, 2010]
| Article 14 (Fact-Finding Survey on Mutually Beneficial Cooperation between Large Enterprises and Small-Medium Enterprises) |
| (1) | The Minister of SMEs and Startups may conduct fact-finding surveys on mutually beneficial cooperation between large enterprises and small and medium enterprises, where necessary. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (2) | The Minister of SMEs and Startups may request large enterprises and small and medium enterprises to submit materials and present their opinions, etc. if necessary to conduct the fact-finding surveys referred to in paragraph (1). <Amended on Mar. 23, 2013; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 15 (Calculation and Publication of Mutually Beneficial Cooperation Index between Large Enterprises and Small-Medium Enterprises) |
| (1) | The Minister of SMEs and Startups may calculate and publish a quantified mutually beneficial cooperation index (hereinafter referred to as "mutually beneficial cooperation index") between large enterprises and small and medium enterprises after assessing the level of mutually beneficial cooperation between large enterprises and small and medium enterprises in order to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (2) | Necessary matters concerning plans to calculate mutually beneficial cooperation index, publication procedures therefor, etc. shall be prescribed by Ordinance of the Ministry of SMEs and Startups. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (3) | Notwithstanding paragraph (1), if deemed necessary by the Minister of SMEs and Startups, a mutually beneficial cooperation index may be replaced by a shared growth index calculated and publicly announced by the National Commission for Corporate Partnership pursuant to Article 20-2 (2) 1. <Newly Inserted on Aug. 6, 2013; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 16 (Selection of and Support for Exemplary Mutually Beneficial Cooperation Enterprises) |
| (1) | The Minister of SMEs and Startups may prepare supporting policies, such as by selecting enterprises that set a good example for mutually beneficial cooperation and those who contribute to distribution of mutually beneficial cooperation (hereinafter referred to as "exemplary mutually beneficial cooperation enterprises, etc.") and rewarding them in order to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (2) | Necessary matters concerning methods of and procedures for selecting exemplary mutually beneficial cooperation enterprises, etc. and policies for supporting such enterprises shall be prescribed by Ordinance of the Ministry of SMEs and Startups. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 17 (Consultative Counsel of Commissioned Enterprises) |
| (1) | Commissioned enterprises (including secondary commissioned enterprises where the commissioned enterprises recommission part of its commissioned work in order to manufacture the commissioned goods, etc.) may establish a consultative counsel of commissioned enterprises by commissioning enterprise, region and type of business in order to maintain equal transaction relationship with commissioning enterprises and to facilitate the exchange of technical information, the joint development of technologies, and other matters. |
| (2) | The State or local governments may provide necessary support to vitalize the consultative council of commissioned enterprises. <Amended on Aug. 6, 2013> |
| (3) | The Large and Small Business, Agriculture, and Fisheries Cooperation Foundation referred to in Article 20 shall investigate the composition and operation of the consultative council of commissioned enterprises each year, and submit the investigation results to the Minister of SMEs and Startups. <Newly Inserted on Aug. 6, 2013; Jan. 17, 2017; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 18 (Narrowing Salary and Welfare Gap between Large Enterprises and Small and Medium Enterprises) |
| (1) | The Government may develop and implement necessary policies, such as by actively supporting efforts to negotiate the salaries between labor and management for mutually beneficial cooperation in order to narrow the salary gap between large enterprises and small and medium enterprises. <Amended on Jan. 9, 2024> |
| (2) | The Government may formulate and implement policies necessary to narrow the welfare gap between large enterprises and small and medium enterprises. <Newly Inserted on Jan. 9, 2024> |
[This Article Wholly Amended on Jan. 27, 2010]
[Title Amended on Jan. 9, 2024]
| Article 19 (Facilitation of Cooperation of Public Institutions with Small-Medium Enterprises) |
| (1) | Institutions prescribed by Presidential Decree (hereafter in this Article referred to as "public institutions") among public institutions falling under Article 4 of the Act on the Management of Public Institutions shall develop a supporting plan for small and medium enterprises and prepare the performance records of such plan each year and submit them to the Minister of SMEs and Startups. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (2) | The Minister of SMEs and Startups may evaluate supporting plans for small and medium enterprises and the performance records of such plans, which are submitted by public institutions pursuant to paragraph (1) and notify the Minister of Economy and Finance of the results thereof. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
| (3) | The Minister of Economy and Finance may reflect the results of assessment notified pursuant to paragraph (2) in evaluating the management of public institutions. |
| (4) | Public institutions may establish and operate an organization dedicated to supporting small and medium enterprises in order to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 20 (Establishment of Large and Small Business, Agriculture, and Fisheries Cooperation Foundation) |
| (1) | The Government shall establish the Large and Small Business, Agriculture, and Fisheries Cooperation Foundation (hereinafter referred to as the "Foundation") to facilitate mutually beneficial cooperation between large enterprises and small and medium enterprises. <Amended on Jan. 17, 2017> |
| (2) | The Foundation shall conduct the following affairs: <Amended on Mar. 23, 2013; Jan. 17, 2017; Jul. 26, 2017; Nov. 28, 2017; Mar. 20, 2018; Jan. 15, 2019; Mar. 28, 2023> |
| 1. | Supporting the development and operation of cooperative projects between large enterprises and small and medium enterprises; |
| 2. | Supporting the management, operation, and evaluation of the technological cooperation facilitation projects provided for in Article 9; |
| 3. | Supporting the establishment and operation of the consultative counsel of commissioned enterprises provided for in Article 17; |
| 4. | Supporting the fairness of transactions effected on consignment and commission provided for in Articles 21, 22, 22-2, 23, 24, 24-2, and 25; |
| 5. | Supporting the autonomous mediation of disputes between commissioning enterprises and commissioned enterprises; |
| 6. | Managing and operating the Fund for Mutually Beneficial Cooperation between Large Enterprises and Small-Medium Enterprises established under Article 20-5; |
| 8. | Supporting the management, operation, distribution and dissemination of mutually-beneficial settlement; |
| 9. | Other affairs designated or entrusted by the Minister of SMEs and Startups. |
| (3) | The Foundation shall be a corporation; and the provisions governing incorporated foundations of the Civil Act shall apply mutatis mutandis to the Foundation except as provided for in this Act. |
| (4) | The Government may subsidize funds necessary to establish and operate the Foundation within budgetary limits. |
| (5) | When the Foundation intends to modify its articles of association, it shall obtain authorization from the Minister of SMEs and Startups. <Amended on Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
[Title Amended on Jan. 17, 2017]
| Article 20-2 (Establishment of National Commission for Corporate Partnership) |
| (1) | The National Commission for Corporate Partnership (hereinafter referred to as the "Commission") shall be established under the Foundation in order to secure consensus in the private sector with regard to shared growth between large enterprises and small and medium enterprises and to create and foster culture for shared growth. |
| (2) | The Commission shall perform the business affairs concerning the following: |
| 1. | Matters concerning calculation and publication of a shared growth index; |
| 2. | Matters concerning the securement of consensus on and publication of suitable types of business; |
| 3. | Other matters deemed necessary by the Commission to promote shared growth in the private sector. |
| (3) | The Commission shall perform the business affairs referred to in paragraph (2) independently and autonomously from government agencies, the Foundation, etc. |
| (4) | To calculate and publish a shared growth index, the Commission may request the heads of relevant central administrative agencies, the heads of public institutions, the representatives of enterprises, etc. to provide necessary data. In such cases, the heads of relevant central administrative agencies, etc. so requested shall comply with such request, in the absence of special circumstances. <Newly Inserted on Nov. 28, 2017> |
| (5) | The Commission shall prepare and keep its minutes in accordance with its bylaws. <Newly Inserted on Jan. 27, 2016; Nov. 28, 2017> |
| (6) | Matters necessary for organizing and operating the Commission shall be determined by resolution of the Commission. <Amended on Jan. 27, 2016; Nov. 28, 2017> |
[This Article Newly Inserted on Jan. 17, 2012]
[Title Amended on Nov. 28, 2017]
| Article 20-3 (Shared Growth Week) |
In order to facilitate shared growth of large enterprises and small and medium enterprises and to enhance understanding and awareness of the shared growth among the general public, one week per year shall be designated as Shared Growth Week.
[This Article Newly Inserted on Jan. 17, 2017]
| Article 20-4 (Application for Consensus on Suitable Types of Business) |
| (1) | An organization of small-medium enterprisers may file an application with the Commission for securing consensus on suitable types of business under Article 20-2 (2) 2. |
| (2) | Upon receipt of an application under paragraph (1), the Commission shall reach a consensus on suitable types of business within one year (Provided, That if the designation of a type of business suitable for livelihood is recommended pursuant to Article 7 (2) of the Special Act on the Designation of Types of Business Suitable for Livelihood of Micro Enterprises, the period from the date such recommendation is made to the date the designation is deliberated and determined on shall not be included in calculating such period for reaching a consensus) from the date of application, after hearing opinions of enterprises, the relevant organization of small-medium enterprisers, experts, etc. referred to in Article 32 (1) 1 through 3. In such cases, the Commission may request the relevant enterprises and organization of small-medium enterprisers to submit data necessary for reaching a consensus on suitable types of business or to attend a meeting of the Commission. <Amended on Mar. 20, 2018; Jun. 12, 2018> |
| (3) | Where no consensus is reached on suitable types of business within the time limit specified in paragraph (2), or where the details of consensus are not executed, the Commission may file an application with the Minister of SMEs and Startups for business coordination; and the relevant organization of small-medium enterprisers which has applied for consensus may also file an application with the Minister of SMEs and Startups for business coordination via the Commission. <Amended on Jul. 26, 2017> |
[This Article Newly Inserted on Apr. 18, 2017]
| Article 20-5 (Establishment of Fund for Mutually Beneficial Cooperation between Large Enterprises and Small-Medium Enterprises) |
| (1) | To lay the foundation for sustainable growth of the national economy by promoting sustainable development of large enterprises and small and medium enterprises, mutually beneficial cooperation between them, and their shared growth, the Fund for Mutually Beneficial Cooperation between Large Enterprises and Small-Medium Enterprises (hereinafter referred to as the "Mutually Beneficial Cooperation Fund") shall be established in the Foundation. |
| (2) | The Foundation shall manage and operate accounts of the Mutually Beneficial Cooperation Fund separately from other accounts. |
| (3) | The Mutually Beneficial Cooperation Fund shall be created out of contributions, etc. from domestic corporations. |
| (4) | A person who makes contributions pursuant to paragraph (3) may designate the use of the contributions and projects to be implemented. In such cases, the Foundation shall use the contributions, etc. for the designated use and projects. |
| (5) | The Mutually Beneficial Cooperation Fund shall be used for the following: |
| 1. | A project for equitable distribution of the results of mutually beneficial cooperation between large enterprises and small and medium enterprises; |
| 2. | A project to facilitate technological cooperation between large enterprises and small and medium enterprises; |
| 3. | A project to expand human resources exchange between large enterprises and small and medium enterprises; |
| 4. | A project to facilitate cooperation between large enterprises and small and medium enterprises in environmental management; |
| 5. | A project to narrow the salary gap between large enterprises and small and medium enterprises and to support job creation; |
| 6. | Expenses incurred in raising, operating, and managing the Mutually Beneficial Cooperation Fund; |
| 7. | Any other projects prescribed by Presidential Decree, which are designed to promote cooperation between large enterprises and small and medium enterprises. |
[This Article Newly Inserted on Nov. 28, 2017]
CHAPTER IV FAIRNESS OF TRANSACTIONS EFFECTED ON CONSIGNMENT AND COMMISSION
| Article 21 (Issuance of Written Agreements) |
| (1) | When an enterprise commissions the manufacture of goods, etc. to any other enterprise, the commissioning enterprise shall without delay issue a written agreement specifying the following matters to the commissioned party: <Amended on Jan. 3, 2023> |
| 1. | Details of the commission; |
| 2. | Price of delivered goods (including the method and date of payment); |
| 3. | Methods of inspecting delivered goods, etc.; |
| 4. | Matters regarding the linkage of the price of delivered goods, such as names, major raw materials, adjustment requirements, standards index, and mathematical formula of goods, etc. subject to the linkage of the price of delivered goods, as prescribed by Presidential Decree; |
| 5. | Other matters to be entered in a written agreement, as prescribed by Presidential Decree. |
| (2) | A commissioning enterprise shall faithfully consult with a commissioned enterprise in order to enter the matters prescribed in paragraph (1) 4 in the written agreement. <Newly Inserted on Jan. 3, 2023> |
| (3) | In any of the following cases, a commissioning enterprise need not enter the matters prescribed in paragraph (1) 4 in the written agreement: Provided, That in cases falling under subparagraph 4, a commissioning enterprise and a commissioned enterprise shall clearly enter the purport and reasons therefor in the written agreement: <Newly Inserted on Jan. 3, 2023> |
| 2. | Where the duration of the transaction effected on consignment and commission is within a period prescribed by Presidential Decree within the scope of not exceeding 90 days; |
| 3. | Where the price of delivered goods does not exceed the amount prescribed by Presidential Decrees within the scope of 100 million won; |
| 4. | Where a commissioning enterprise and a commissioned enterprise agree not to link the price of delivered goods. |
| (4) | No commissioning enterprise shall abuse its position in a transaction regarding transactions effected on consignment and commission in connection with the linkage of the price of delivered goods, or conduct any act to evade the application of this Article by fraud or other improper means. <Newly Inserted on Jan. 3, 2023> |
| (5) | To promote win-win cooperation between commissioning enterprises and commissioned enterprises and fairness in transactions effected on consignment and commission, the Minister of SMEs and Startups shall formulate or amend standard agreements on paragraph (1) 4 and the proviso, with the exception of the subparagraphs, of paragraph (3) and shall make recommends to use them. <Newly Inserted on Jan. 3, 2023> |
| (6) | When the commissioning enterprise receives goods, etc. from the commissioned enterprise, it shall promptly issue the receipt of the delivered goods, regardless of whether it has inspected the goods, etc. <Amended on Jan. 3, 2023> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 21-2 (Conclusion of Confidentiality Agreements) |
| (1) | Where a commissioned enterprise provides a commissioning enterprise with technical data (limited to technical data managed confidentially; hereafter in this paragraph, the same shall apply), the commissioned enterprise and commissioning enterprise shall conclude a written agreement with regard to maintaining confidentiality of such technical data (hereinafter referred to as "confidentiality agreement"), which includes the following: |
| 1. | Purposes and scope of providing the relevant technical data; |
| 2. | Details of the duty to maintain confidentiality; |
| 3. | Matters relating to compensation for damage caused by a violation of the agreement; |
| 4. | Other matters prescribed by Presidential Decree as necessary to maintain confidentiality of the relevant technical data. |
| (2) | The Minister of SMEs and Startups may prepare a standard form agreement on confidentiality and may recommend commissioned enterprises and commissioning enterprises to use it to establish order in fair transactions effected on consignment and commission. |
[This Article Newly Inserted on Aug. 17, 2021]
| Article 21-3 (Formulation and Amendment of Standard Agreements) |
| (1) | The Minister of SMEs and Startups shall formulate or amend a standard agreement (excluding the standard agreement under Article 21 (5)) or designate a standard contract recommended by the head of a central administrative agency pursuant to other statutes or regulations to recommend the use thereof to commissioning enterprises and commissioned enterprises subject to this Act, in order to establish the sound order of transactions effected on consignment and commission and to prevent unfair agreements from being widely used. |
| (2) | A commissioning enterprise, a commissioned enterprise, or an organization of small-medium enterprisers may prepare a proposal for formulation and amendment of a standard agreement which can be widely used in the field of certain transaction effected on consignment and commission, and may request the Minister of SMEs and Startups to examine whether the details thereof violate this Act. |
| (3) | Where the Minister of SMEs and Startups formulates or amends a standard agreement, he or she shall hear the opinions of a commissioning enterprise, a commissioned enterprise, or an organization of small and medium enterprises that is the parties to transaction in the relevant field. |
| (4) | If deemed necessary for performing the business affairs related to the formulation and amendment of a standard agreement, the Minister of SMEs and Startups may commission advisors. |
| (5) | The commissioning and operation of advisors under paragraph (4) and other matters necessary for formulation, amendment, etc. of a standard agreement shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Oct. 31, 2023]
| Article 22 (Payment of Price of Delivered Goods) |
| (1) | The payment date for the price of the delivered goods by a commissioning enterprise to a commissioned enterprise shall be the shortest period of not more than 60 days from the date on which the commissioning enterprise receives the goods, etc. regardless of whether it has inspected the goods, etc. |
| (2) | When the payment date for the price of the delivered goods is not agreed, the date on which the goods, etc. are received by the commissioning enterprise shall be deemed the date on which it is agreed to pay the price of the goods, etc. and when the payment date is set in violation of paragraph (1), the date on which 60 days lapse from the date on which the goods, etc. are received shall be deemed the date on which it is agreed to pay the price of the goods, etc. |
| (3) | Where any commissioning enterprise pays the price of delivered goods, etc. after 60 days from the date of receipt of the goods, etc., it shall pay the interest calculated according to the interest rate prescribed by Presidential Decree within the extent of 40/100 per year for the delayed period. <Amended on Oct. 20, 2020> |
| (4) | Where a commissioning enterprise pays the price of delivered goods by means of bills or payment replacing bills, it shall pay discount charge prescribed by Presidential Decree within the extent of 40/100 per year to the commissioned enterprise. |
| (5) | Where a commissioned enterprise (including subordinate commissioned enterprises at multiple levels) has received the price of delivered goods through mutually-beneficial settlement, it shall pay the price of delivered goods to a subordinate commissioned enterprise through cash settlement or mutually-beneficial settlement at a ratio exceeding the ratio of mutually-beneficial settlement to the total price of delivered goods paid, except in extenuating circumstances prescribed by Presidential Decree, such as direct payment of the subcontract consideration of construction works or bankruptcy of a commissioning enterprise. <Newly Inserted on Mar. 20, 2018> |
| (6) | Notwithstanding Articles 22 and 23 of the Management of the National Funds Act, and Articles 32 and 33 of the Local Accounting Act, and other statutes or regulations, central government agencies under Article 6 of the National Finance Act and local governments (including the Office of Education of the Special Metropolitan City, a Metropolitan City, a Special Self-Governing City, a Do, or a Special Self-Governing Province under the Local Education Autonomy Act; hereafter in this paragraph the same shall apply) under Article 2 of the Local Autonomy Act may pay the price of delivered goods by means of mutually-beneficial settlement by central government agencies and local governments. In such cases, with regard to accounts receivable paid as the price of delivered goods by central government agencies or local governments, a commissioned enterprise shall not be granted a discount on such accounts receivable by a financial institution established by statutes. <Newly Inserted on Oct. 19, 2021; Jun. 20, 2023> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 22-2 (Adjustment of Price of Delivered Goods due to Fluctuation in Supply Costs) |
| (1) | Where it is inevitable to adjust the price of delivered goods because the supply costs of goods, etc. have fluctuated after being commissioned manufacturing the goods, etc., a commissioned enterprise may file an application for adjusting the price of the delivered goods with the relevant commissioning enterprise. |
| (2) | Where it is unavoidable for a small and medium enterprise cooperative defined in Article 3 (1) 1, 2, or 4 of the Small and Medium Enterprise Cooperatives Act to adjust the price of delivered goods to be paid to any of its members (in cases of the Korea Federation of Small and Medium Business under Article 3 (1) 4 of the Small and Medium Enterprise Cooperatives Act, members of a small and medium enterprise cooperative under subparagraph 1 or 2 of the same paragraph) as a commissioned enterprise because the supply costs of goods, etc. have fluctuated, the cooperative may consult with the relevant commissioning enterprise prescribed by Presidential Decree on the adjustment of the price of the delivered goods upon receipt of an application from the commissioned enterprise (in cases of the Korea Federation of Small and Medium Business under Article 3 (1) 4 of the Small and Medium Enterprise Cooperatives Act, a small and medium enterprise cooperative under subparagraph 1 or 2 of the same paragraph): Provided, That this shall not apply where both the commissioning enterprise and the commissioned enterprise are members of the same cooperative. <Amended on Oct. 20, 2020; Jan. 9, 2024> |
| (3) | Upon receipt of an application under the main clause of paragraph (2), a small and medium enterprise cooperative shall file an application for adjusting the price of delivered goods with the relevant commissioning enterprise within 20 days from receipt of such application: Provided, That where the Korea Federation of Small and Medium Business under Article 3 (1) 4 of the Small and Medium Enterprise Cooperatives Act consults with the commissioning enterprise, the small and medium enterprise cooperative shall file an application with the Korea Federation of Small and Medium Business within 20 days of receipt of application from a commissioned enterprise, and the Korea Federation of Small and Medium Business shall apply for an adjustment with the relevant commissioning enterprise of the price of delivered goods within 15 days of receipt of such request. <Amended on Oct. 20, 2020> |
| (4) | Where a commissioned enterprise that has applied for the adjustment of the price of delivered goods pursuant to paragraph (1) requests consultations under paragraph (2), the application filed under paragraph (1) shall be deemed suspended; and where the consultations on adjustment under paragraph (1) or (3) are completed, neither the relevant commissioned enterprise nor the relevant small and medium enterprise cooperative may apply for the adjustment under paragraphs (1) through (3) based on the same grounds, in the absence of a change in circumstances; and where a commissioned enterprise applies for the adjustment of the subcontract consideration pursuant to Article 16-2 of the Fair Transactions in Subcontracting Act, it shall not file an application under paragraph (1) or (2) based on the same grounds. |
| (5) | Upon receipt of an application under paragraph (2), no small and medium enterprise cooperative shall place any unreasonable restriction on competitions or unfairly restrict the scope of business or business activities of the relevant enterprise, such as resolving to discontinue the supply of goods, etc. |
| (6) | Matters necessary for the requirements, procedures, and methods for filing an application by a commissioned enterprise and for exercising a small and medium enterprise cooperatives' authority to hold consultations under the main clause of paragraph (2) shall be prescribed by Presidential Decree. |
| (7) | A commissioning enterprise shall commence consultations on the adjustment of the price of delivered goods with a commissioned enterprise that has applied for the adjustment or with the relevant small and medium enterprise cooperative within 10 days from the date the application is filed under paragraph (1) or (3); and shall not reject or neglect consultations without any justifiable grounds. |
| (8) | A commissioning enterprise or a commissioned enterprise (including a small and medium enterprise cooperative if consultations on adjustment are held upon receipt of an application under paragraph (3); hereafter in this Article the same shall apply) may file an application for mediation with the Minister of SMEs and Startups pursuant to Article 28, in any of the following cases: |
| 1. | Where a commissioning enterprise fails to commence consultations on the adjustment of the price for delivered goods even after 10 days elapse from the date an application is filed under paragraph (1) or (3); |
| 2. | Where no agreement is reached on the adjustment of the price of delivered goods within 30 days from the date an application is filed under paragraph (1) or (3); |
| 3. | Where a commissioning enterprise and a commissioned enterprise are obviously anticipated to fail to reach an agreement due to any cause prescribed by Presidential Decree, such as where either of the enterprises manifests its intention to discontinue consultations after the consultations are commenced in response to an application filed under paragraph (1) or (3). |
[This Article Newly Inserted on Jan. 15, 2019]
| Article 22-3 (Selection of and Support for Exemplary Enterprises in Linkage of Price of Delivered Goods) |
| (1) | The Minister of SMEs and Startups may formulate and implement support policies, such as selecting and awarding exemplary enterprises in the linkage of the price of delivered goods and persons who have contributed to the proliferation of the linkage of the price of delivered goods (hereinafter referred to as "exemplary enterprises, etc. in the linkage of the price of delivered goods") to proliferate the linkage of the price of delivered goods. |
| (2) | Matters necessary for the methods and procedures for selection of exemplary enterprises, etc. in the linkage of the price of delivered goods, support policies, etc. shall be prescribed by Ordinance of the Ministry of SMEs and Startups. |
[This Article Newly Inserted on Jan. 3, 2023]
| Article 22-4 (Designation of Headquarters for Supporting Expansion of Linkage of Price for Delivery) |
| (1) | The Minister of SMEs and Startups may designate institutions or organizations related to support for small and medium enterprises, as a support center for the expansion of the linkage of the price of delivered goods (hereinafter referred to as "linkage support center") to support the expansion of the linkage of the price of delivered goods. |
| (2) | The linkage support center shall conduct the following projects: |
| 1. | Provision of information on prices of raw materials and major price index; |
| 2. | Confirmation of the performance results of introduction and adjustment of the linkage of the price of delivered goods; |
| 3. | Education and consulting related to the linkage of the price of delivered goods; |
| 4. | Other matters prescribed by Ordinance of the Ministry of SMEs and Startups, which are necessary for the expansion of the linkage of the price of delivered goods. |
| (3) | The Minister of Trade, Industry and Energy may provide the linkage support center with support necessary to conduct the projects under each subparagraph of paragraph (2). |
| (4) | The Minister of SMEs and Startups may cancel the designation or order the suspension of all or part of the business for a specified period not exceeding six months, if the linkage support center falls under any of the following cases: Provided, That where it falls under subparagraph 1, the Minister shall revoke the designation thereof: |
| 1. | Where it obtains designation by fraud or other improper means; |
| 2. | Where it fails to meet the standards for designation under paragraph (5); |
| 3. | Where it fails to perform the business described in the subparagraphs of paragraph (2) for at least one month without good cause. |
| (5) | Detailed matters regarding the standards, procedures, etc. for the designation and revocation of designation of the linkage support center shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Jan. 3, 2023]
| Article 23 (Rationalization of Inspections) |
| (1) | A commissioning enterprise shall seek to improve its inspection facilities and to enhance the qualification of inspectors, and shall set objective and reasonable inspection standards in order to ensure fair and prompt inspection of goods, etc. which are delivered by the commissioned enterprise. |
| (2) | With respect to any goods, etc. that fail to pass an inspection conducted under paragraph (1), the relevant commissioning enterprise shall promptly notify in writing the relevant commissioned enterprise of the grounds therefor. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 24 (Quality Assurance) |
| (1) | A commissioned enterprise shall endeavor to improve its facilities and technology in order to improve the quality of manufactured goods which is commissioned by a commissioning enterprise and to deliver goods meeting the specified standards by the delivery deadline. |
| (2) | A commissioned enterprise shall endeavor to standardize its products, set reasonable prices utilizing a reasonable cost-calculation system, and control the quality of manufactured goods. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 24-2 (Technical Data Bailment System) |
| (1) | A commissioned enterprise and a commissioning enterprise (including an enterprise that intends to accept custody of technical data on its own or jointly with another person, in addition to the commissioned enterprise and the commissioning enterprise) may accept deposit of technical data held by an enterprise intending to bail technical data (hereinafter referred to as "bailor enterprise") in consultation with an agency prescribed by Presidential Decree that has experts, equipment, etc. (hereinafter referred to as "bailee"). <Amended on Dec. 7, 2010> |
| (2) | In any of the following cases, a commissioning enterprise may request a bailee to deliver technical data of which a commissioned enterprise takes custody: |
| 1. | Where the commissioned enterprise has agreed thereto; |
| 2. | Where it meets the conditions of delivery of technical data determined through consultation between the commissioning enterprise and the commissioned enterprise, such as where the right of the commissioned enterprise is extinguished because it has declared bankruptcy or has resolved to dissolve, or where it is unable to carry on business because it has closed its place of business, etc. |
| (3) | Where the conditions of delivery of technical data determined by the Minister of SMEs and Startups are satisfied, the bailee shall deliver technical data of a bailor enterprise to a person who requests such data. <Newly Inserted on Dec. 7, 2010; Jul. 26, 2017> |
| (4) | The Government may give necessary support to bailees within the budget. <Amended on Dec. 7, 2010> |
| (5) | Other matters necessary for the bailment, etc. of technical data shall be prescribed by Presidential Decree. <Amended on Dec. 7, 2010> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 24-3 (Registration of Bailment of Technical Data) |
| (1) | A bailor enterprise may register the following: |
| 1. | The title, type, and production date of technical data; |
| 2. | The outline of technical data; |
| 3. | The name and address of the bailor enterprise; |
| 4. | Other matters prescribed by Presidential Decree. |
| (2) | If any dispute arises between the parties concerned or the parties interested with regard to technology of a bailor enterprise registered in its real name pursuant to paragraph (1), such technology shall be construed to have been developed by the bailor enterprise according to the details of the deposited goods. |
[This Article Newly Inserted on Dec. 7, 2010]
| Article 24-4 (Duty of Confidentiality) |
No person who was, or is currently engaged in the business of managing technical data under Article 24-2 may disclose confidential information he or she has learned in the course of performing his or her duties to any third person. [This Article Newly Inserted on Dec. 7, 2010]
| (1) | A person who has been designated as a bailee pursuant to Article 24-2 may collect fees from a bailor enterprise, etc. with regard to the relevant business. |
| (2) | Matters regarding the type, rate, amount, payment method, etc. of fees referred to in paragraph (1) shall be determined by the Minister of SMEs and Startups. <Amended on Jul. 26, 2017> |
[This Article Newly Inserted on Dec. 7, 2010]
| Article 25 (Matters to Be Observed) |
| (1) | A commissioning enterprise shall not perform the following acts when it entrusts the manufacture of goods, etc. to any commissioned enterprise: <Amended on Jan. 15, 2019; Aug. 17, 2021; Jan. 3, 2023> |
| 1. | Refusing to accept goods, etc. or reducing the price of delivered goods, etc. without any reason attributable to the commissioned enterprise; |
| 1-2. | Arbitrarily canceling or changing the entrustment of manufacturing goods, etc. in order to not perform the matters prescribed in Article 21 (1) 4 after entrusting the manufacture of goods, etc., even though the commissioned enterprise is not responsible therefor; |
| 2. | Failing to pay the price of delivered goods by the payment date; |
| 3. | Determining the price of delivered goods, at a price considerably lower than that normally paid for the goods, etc. of the same type or similar thereto delivered by any commissioned enterprise in their kinds; |
| 4. | Failing to increase the price of delivered goods according to the ratio of additional amount paid by the person who places an order to the commissioning enterprise on the grounds that the economic situation changes after the manufacture of goods, etc. is commissioned, although the commissioned enterprise faces additional costs on the same grounds; |
| 5. | Coercing a commissioned enterprise to buy the goods, etc. that are designated by the commissioning enterprise except where necessary to maintain or improve the quality of the goods, etc. or where there exist other justifiable grounds to do so; |
| 6. | Paying for the price of delivered goods, etc. with a bill that is hard to sell at a discount to any financial institution by the payment date of the price of delivered goods; |
| 7. | Significantly reducing the quantity of ordered goods compared to the quantity of ordinarily ordered goods or discontinuing the placement of the order without any justifiable grounds although no defect is found in the goods, etc.; |
| 8. | Demanding a commissioned enterprise to receive goods manufactured by the commissioning enterprise in lieu of the payment of the price of the delivered goods; |
| 9. | Evading the opening of a local letter of credit on the goods, etc. on which an order has been placed by the commissioning enterprise for their export; |
| 10. | Evading the placement of an order on manufactured goods, etc. after having requested for the manufacture of such goods, etc. without any justifiable grounds thereof; |
| 11. | Setting objectively unreasonable standards when inspecting goods delivered by commissioned enterprises; |
| 12. | Requesting the provision of technical data without justifiable grounds; |
| 13. | Giving disadvantage to the commissioned enterprise that has requested for the deposit of technical data; |
| 13-2. | Requesting cost data or any other managerial information prescribed by Ordinance of the Ministry of SMEs and Startups without any justifiable grounds; |
| 14. | Reducing the quantity of the transaction effected on consignment and commission, discontinuing the transaction effected on consignment and commission, or giving other disadvantages on the grounds that the relevant commissioned enterprise performs any of the following acts: |
| (a) | Notifying any relevant agency of the fact that the commissioning enterprise performs any of the following acts: |
| (i) | An act falling under subparagraphs 1, 1-2, 2 through 13, and 13-2; |
| (ii) | A violation of paragraph (2); |
| (b) | Applying for adjusting the price of delivered goods in regard of the commissioning enterprise pursuant to Article 22-2 (1) or (2); or applying for mediating a dispute with the Minister of SMEs and Startups pursuant to Article 22-2 (8). |
| (2) | No commissioning enterprise shall commit any of the following misuses in an unjust manner with regard to the technical data of a commissioned enterprise that it has obtained (limited to technical data managed confidentially): <Amended on Aug. 17, 2021> |
| 1. | Using such data for himself or herself or a third party; |
| 2. | Providing such data to a third party. |
| (3) | Where any commissioning enterprise pays the price of delivered goods, etc. reduced by performing any act prescribed in paragraph (1) 1 after 60 days from the day of receipt of delivered goods, it shall pay interest calculated according to the interest rate prescribed by Presidential Decree at a rate not to exceed 40/100 per year. <Newly Inserted on Oct. 20, 2020> |
| (4) | A commissioned enterprise shall not perform any of the following acts when commissioned to manufacture goods, etc.: <Amended on Aug. 6, 2013; Oct. 20, 2020> |
| 1. | An act of violating an agreement on the quality, performance, or delivery date of goods, etc. commissioned by a commissioning enterprise; |
| 2. | An act of requesting any unreasonable increase in the price of goods, etc.; |
| 3. | Other acts of disrupting the order of transactions on consignment and commission. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 25-2 (Burden of Proof Borne by Commissioning Enterprise) |
The burden of proof in dispute settlement related to any act specified in Articles 21 (4) and 25 (1) 1 and 3 through 5 shall be borne by the relevant commissioning enterprise. <Amended on Jan. 9, 2024> [This Article Newly Inserted on Jan. 15, 2019]
| Article 26 (Request for Measures to Fair Trade Commission) |
| (1) | When a commissioning enterprise violates Articles 21, 22, 22-2, 23, or 25 (1) through (3) and when it is deemed that such violation falls under Articles 3, 4 through 12, 12-2, 12-3, 13, 13-2, 15, 16, 16-2, and 17 through 20 of the Fair Transactions in Subcontracting Act or constitutes a prohibited act provided for in Article 45 (1) of the Monopoly Regulation and Fair Trade Act, the Minister of SMEs and Startups shall request the Fair Trade Commission to take necessary measures against the commissioning enterprise pursuant to Article 25 of the Fair Transactions in Subcontracting Act or Article 49 of the Monopoly Regulation and Fair Trade Act. <Amended on Jan. 27, 2016; Jul. 26, 2017; Jan. 15, 2019; Oct. 20, 2020; Dec. 29, 2020> |
| (2) | Upon receipt of a request pursuant to paragraph (1), the Chairperson of the Fair Trade Commission shall give priority to examining the request; take necessary measures within six months; and notify the Minister of SMEs and Startups of the results: Provided, That the deadline may be extended by up to one year in consultation with the Minister of SMEs and Startups, if unavoidable reasons arise. <Amended on Mar. 18, 2014; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 27 (Improvements in Unfair Trade Practices between Commissioned and Commissioning Enterprises) |
| (1) | The Minister of SMEs and Startups shall periodically survey whether commissioning enterprises implement Articles 21, 21-2 (1), 22, 22-2, 23, and 25 (1) through (3) in the course of transactions effected on consignment and commission between large enterprises and small and medium enterprises, as prescribed Presidential Decree; and may request relevant enterprises to improve the matters requiring improvement. <Amended on Jul. 26, 2017; Jan. 15, 2019; Oct. 20, 2020; Aug. 17, 2021> |
| (2) | Where any commissioning enterprise under paragraph (1) violates Article 21, 22, 22-2, 23, or 25 (1) through (3), the Minister of SMEs and Startups may order such enterprise to pay the price of delivered goods, suspend its violation of the Act, or to take other necessary measures for correction: Provided, That this shall not apply where the violations fall under Articles 3, 4 through 12, 12-2, 12-3, 13, 13-2, 15, 16, 16-2, and 17 through 20 of the Fair Transactions in Subcontracting Act or prohibited acts under Article 23 (1) of the Monopoly Regulation and Fair Trade Act. <Newly Inserted on Oct. 20, 2020> |
| (3) | Where any commissioning enterprise in receipt of a request for improvement under paragraph (1) or an order under paragraph (2) fails to comply with such request or order, the Minister of SMEs and Startups shall publish the name of such enterprise and the summary of the request or order. <Newly Inserted on Oct. 20, 2020> |
| (4) | Where deemed necessary, the Minister of SMEs and Startups shall apply paragraphs (1) through (3) mutatis mutandis where small and medium enterprises of a size exceeding that prescribed by Presidential Decree commission the manufacture of goods to other small and medium enterprises. <Amended on Jul. 26, 2017; Oct. 20, 2020> |
| (5) | Where an enterprise is found to have good settlement conditions, including the increase of cash settlements, mutually-beneficial settlements, etc., and to have endeavored to establish fair relation of transaction effected on consignment and commission as a result of the survey referred to in paragraphs (1) and (4), the Minister of SMEs and Startups may grant reward to such enterprise and provide it with other necessary support. <Amended on Jul. 26, 2017; Mar. 20, 2018; Oct. 20, 2020> |
| (6) | The Government may provide taxation support and other necessary support in order to improve settlement conditions for the price of goods delivered by small and medium enterprises to large enterprises and to increase the cash settlement (including the settlement in cash and mutually-beneficial settlement). <Amended on Mar. 20, 2018; Oct. 20, 2020> |
| (7) | Deleted. <Mar. 28, 2023> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 28 (Mediation of Disputes) |
| (1) | Where a dispute on any of the following matters arises between commissioning enterprises and commissioned enterprises or between small-medium enterprise cooperatives, the commissioning enterprises and the commissioned enterprises as well as the small-medium enterprise cooperatives involved in such dispute may request the Minister of SMEs and Startups to mediate their dispute, as prescribed by Presidential Decree: <Amended on Jul. 26, 2017; Jan. 15, 2019; Jan. 3, 2023> |
| 1. | Matters concerning a written agreement, linkage of the price of delivered goods, and the receipt of goods provided for in Article 21; |
| 2. | Matters concerning the payment of delivered goods, etc. provided for in Article 22; |
| 2-2. | Matters concerning the adjustment of the price of delivered goods under Article 22-2; |
| 3. | Matters concerning the inspection of goods, etc. provided for in Article 23; |
| 4. | Matters concerning deposit of technical data provided for in Article 24-2; |
| 5. | Matters concerning whether matters to be observed pursuant to Article 25 are complied with. |
| (2) | The commissioned enterprise involved in the dispute as described in paragraph (1) may delegate its authority regarding the mediation of the dispute to an organization of small-medium enterprisers. <Newly Inserted on Jan. 27, 2016> |
| (3) | Upon receipt of a request for mediation referred to in paragraph (1), the Minister of SMEs and Startups shall without delay examine the contents thereof and where it is deemed necessary to correct the matters referred to in each subparagraph of paragraph (1), recommend the relevant commissioning enterprise, commissioned enterprise, or small-medium enterprise cooperatives to correct such matters or issue a corrective order. <Amended on Jan. 27, 2016; Jul. 26, 2017> |
| (4) | When the relevant commissioning enterprise, commissioned enterprise, or small-medium enterprise cooperatives refuses to comply with a corrective order under paragraph (3), the Minister of SMEs and Startups shall publish its names and the gist of the corrective order: Provided, That where the acts of the relevant commissioning enterprise fall under Article 26, the Minister of SMEs and Startups shall request the Fair Trade Commission to take necessary measures. <Amended on Jan. 27, 2016; Jul. 26, 2017> |
| (5) | Necessary matters concerning the examination, recommendation for correction, and a corrective order under paragraph (3) shall be prescribed by Presidential Decree. <Amended on Jan. 27, 2016> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 28-2 (Demerit Points) |
| (1) | The Minister of SMEs and Startups may impose demerit points on a commissioning enterprise that has violated Article 21, 21-2 (1), 22, 22-2, 23, or 25 (1) through (3), depending on the severity of a violation and damage, as prescribed by Presidential Decree. |
[This Article Newly Inserted on Mar. 28, 2023]
[Previous Article 28-2 moved to Article 28-4 <Mar. 28, 2023>]
| Article 28-3 (Reduction of or Exemption from Demerit Points) |
| (1) | The Minister of SMEs and Startups need not make a request for improvement, etc., where an enterprise subject to inspection remedies damage resulting from any violation (hereinafter referred to as "violation") subject to a request for improvement or a corrective order under Article 27 (1), (2), or (4) and a recommendation for correction or a corrective order under Article 28 (3) (hereinafter referred to as "request for improvement, etc.") before the commencement of an inspection under Article 40. |
| (2) | The Minister of SMEs and Startups may reduce and impose the demerit points under Article 28-2 (1), as prescribed by Presidential Decree, where an enterprise subject to inspection has remedied damage resulting from any violation before the Minister makes a request for improvement, etc. |
[This Article Newly Inserted on Mar. 28, 2023]
| Article 28-4 (Training Orders) |
| (1) | With regard to the commissioning enterprise which has received demerit points pursuant to Article 28-2 (1), the Minister of SMEs and Startups may take measures, such as a training order, to the executive officers and employees of the relevant enterprise, as well as a request for improvement, etc., according to the criteria for demerit points prescribed by Presidential Decree. In such cases, he or she may have the commissioning enterprise bear the expenses incurred in training. <Amended on Mar. 23, 2013; Jan. 27, 2016; Jul. 26, 2017; Oct. 20, 2020; Mar. 28, 2023> |
| (2) | Necessary matters concerning the detailed procedures, methods, etc. of taking measures, such as a training order, etc. shall be publicly notified by the Minister of SMEs and Startups. <Amended on Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
[Moved from Article 28-2] <Mar. 28, 2023>]
| Article 28-5 (Establishment of Consignment and Commission Dispute Mediation Council) |
| (1) | The Foundation shall establish a Consignment and Commission Dispute Mediation Council (hereinafter referred to as the "Dispute Mediation Council") to support the autonomous mediation of disputes between commissioning enterprises and commissioned enterprises under Article 20 (2) 5. |
| (2) | The Dispute Mediation Council shall deliberate and resolve on the following matters: |
| 1. | Matters relating to mediation of disputes; |
| 2. | Matters relating to the enactment, amendment, and repeal of the rules of the Dispute Mediation Council; |
| 3. | Other matters submitted to meetings by the chairperson of the Dispute Mediation Council. |
| (3) | The Government may subsidize all or part of the expenses incurred in operating the Dispute Mediation Council. |
[This Article Newly Inserted on Mar. 28, 2023]
| Article 28-6 (Composition and Operation of Dispute Mediation Council) |
| (1) | The Dispute Mediation Council shall be composed of up to 20 members, including one chairperson, and its members shall be commissioned by the Minister of SMEs and Startups from among any of the following persons: |
| 1. | A person who has majored in law, economics, or business management, and works or has worked at a university or college or an accredited research institute as at least an associate professor or equivalent; |
| 2. | A person who serves or has served as a judge or prosecutor; |
| 3. | A person with experience in the business affairs related to the fairness of transactions effected on consignment and commission, who is or has been in the position of public official of Grade IV or higher (including a member in general service of the Senior Executive Service); |
| 4. | A person qualified as an attorney-at-law, patent attorney, or certified public accountant; |
| 5. | Other persons with extensive knowledge of and experience in the fairness of transactions effected on consignment and commission. |
| (2) | The chairperson of the Dispute Mediation Council shall be appointed by the Minister of SMEs and Startups from among the members qualified as attorneys-at-law, and shall represent the Dispute Mediation Council. |
| (3) | Each member shall hold office for a term of two years and may be appointed consecutively for further terms. |
| (4) | Where a member falls under any of the following cases, the Minister of SMEs and Startups may dismiss the relevant member: |
| 1. | Where the member becomes unable to perform the duties due to mental or physical disability; |
| 2. | Where the member commits any misconduct in relation to his or her duties; |
| 3. | Where the member is deemed unfit as a member due to negligence of duties, injury to dignity, or other causes; |
| 4. | Where the member voluntarily admits that it is impracticable for him or her to perform the duties. |
| (5) | A majority of the members of the Dispute Mediation Council shall constitute a quorum, and any resolution thereof shall require the concurring vote of at least a majority of those present. |
| (6) | Except as provided in this Act, matters necessary for the operation, etc. of the Dispute Mediation Council shall be determined by the Dispute Mediation Council with approval from the Minister of SMEs and Startups. |
[This Article Newly Inserted on Mar. 28, 2023]
| Article 28-7 (Composition and Operation of Mediation Panel) |
| (1) | To efficiently settle disputes referred to in Article 28-5 (2) 1, the Dispute Mediation Council may establish a mediation panel composed of not more than three members of the Dispute Mediation Council. |
| (2) | The head and members of a mediation panel shall be appointed by the chairperson of the Dispute Mediation Council. In such cases, the head of the mediation panel shall be appointed from among members qualified as an attorney-at-law. |
| (3) | A majority of the members of a mediation panel, including the head of the mediation panel, shall constitute a quorum, and any resolution thereof shall require the concurring vote of a majority of those present. In such cases, a resolution of the mediation panel shall be deemed a resolution of the Dispute Mediation Council. |
[This Article Newly Inserted on Mar. 28, 2023]
| Article 28-8 (Exclusion of, Challenge to, or Recusal of, Members of Dispute Mediation Council) |
| (1) | A member who falls under any of the following cases shall be excluded from the mediation of the relevant case: |
| 1. | Where the member or his or her spouse or ex-spouse is a disputing party to the relevant case or is in a relationship of a joint right-holder or obligor with the disputing party; |
| 2. | Where the member is or was a relative under the Civil Act of a party to the relevant case; |
| 3. | Where the member has given testimony or expert opinions in connection with the relevant case; |
| 4. | Where the member is or was involved in the relevant case, as an agent for the disputing party or as an executive officer or employee; |
| 5. | Where the member or a corporation to which the member belongs serves as a consultant or advisor for legal affairs, business management, etc. of the disputing party. |
| (2) | If the circumstances indicate that it would be impracticable to expect fair deliberations and resolutions by a member, a disputing party may file a motion for challenge to the relevant member with the Dispute Mediation Council. |
| (3) | Where a member falls under any of the grounds referred to in paragraph (1) or (2), he or she may voluntarily recuse himself or herself from the mediation of the relevant case. |
[This Article Newly Inserted on Mar. 28, 2023]
| Article 28-9 (Application for Mediation with Dispute Mediation Council) |
| (1) | A person who wishes the mediation of a dispute over the matters specified in the subparagraphs of Article 28 (1) may apply for mediation, by submitting a written application for mediation stating the purpose and ground for the application to the Dispute Mediation Council. |
| (2) | The Minister of SMEs and Startups may request the autonomous mediation of disputes from the Dispute Mediation Council regarding the cases of disputes over the matters specified in the subparagraphs of Article 28 (1). |
| (3) | Upon receipt of an application for dispute mediation from the disputing parties pursuant to paragraph (1), the Dispute Mediation Council shall report the details thereof to the Minister of SMEs and Startups without delay. |
| (4) | An application for dispute mediation under paragraph (1) shall have the effect of interrupting civil prescription: Provided, That this shall not apply when the application is withdrawn or dismissed without prejudice. |
| (5) | In cases falling under the proviso of paragraph (4), when a judicial claim is made, bankruptcy procedures commence, or seizure, provisional seizure, or provisional disposition occurs within six months, prescription shall be deemed interrupted by filing the initial application for dispute mediation. |
| (6) | Prescription interrupted under the main clause of paragraph (4) shall begin to run anew from any of the following time: |
| 1. | When a mediation report is prepared after the mediation is successfully concluded; |
| 2. | When the mediation procedures end failing to mediate the dispute. |
| (7) | Where mediation by the Dispute Mediation Council is successfully concluded and the agreed matters are fulfilled, the Minister of SMEs and Startups shall not make a request for improvement, etc. |
[This Article Newly Inserted on Mar. 28, 2023]
| Article 28-10 (Mediation of Dispute Mediation Council) |
| (1) | If necessary for mediation, the Dispute Mediation Council may request the submission of related data or attendance from the disputing parties or an expert witness. In such cases, the disputing parties or expert witness shall not reject such request without good cause. |
| (2) | The Dispute Mediation Council may recommend the disputing parties to come to an agreement on the relevant case on their own, or may prepare a proposal of mediation and suggest it to the disputing parties. |
| (3) | The Dispute Mediation Council shall dismiss an application for mediation, in any of the following cases: |
| 1. | Where the application for mediation is filed by a person who has no direct interest in the details of the application for mediation; |
| 2. | Where the application for mediation is filed for a case that is not a dispute over any matter specified in the subparagraphs of Article 28 (1). |
| (4) | The Dispute Mediation Council shall terminate the mediation procedures, in any of the following cases: |
| 1. | Where the mediation is successfully concluded because the disputing parties accept the recommendation or mediation proposals of the Dispute Mediation Council, or mediate on their own, etc.; |
| 2. | Where there is no practical benefit to proceed with the mediation procedures, because one of the disputing parties refuses the mediation, or for other reasons. |
| (5) | Where the mediation for the relevant case is successfully concluded, the Dispute Mediation Council shall prepare a mediation report to which the members participating in the mediation and the disputing parties affix their names and seals or their signatures. |
| (6) | Where the disputing parties come to an agreement on the relevant case on their own and request the preparation of a mediation report, the Dispute Mediation Council shall prepare such mediation report. |
| (7) | Where an agreement is reached between the parties to the effect that they accept compulsory execution, the details thereof shall be entered in a mediation report under paragraph (5) or (6). |
| (8) | Notwithstanding Article 56 of the Civil Execution Act, the authenticated copy of a mediation report stating the purport of giving a consent to the compulsory execution under paragraph (7) shall have the same effect as the executive titles with executive force: Provided, That Article 44 (2) of the same Act shall not apply to the allegation of demurrer against the claims. |
| (9) | The disputing parties shall implement the details of the mediation report prepared pursuant to paragraph (5) or (6), and submit the outcomes of performance to the Dispute Mediation Council. |
| (10) | Where an application for mediation is dismissed without prejudice or the mediation procedures are terminated, or where the disputing parties submit the outcomes of implementation of the mediation report, the Dispute Mediation Council shall report the key matters to the Minister of SMEs and Startups. |
| (11) | The Minister of SMEs and Startups may request the Dispute Mediation Council to submit data on the performance records, etc. of dispute mediation. |
[This Article Newly Inserted on Mar. 28, 2023]
CHAPTER V PROTECTION OF BUSINESS ARENA OF SMALL AND MEDIUM ENTERPRISES
| Article 29 Deleted. <Jan. 27, 2010> |
| Article 30 Deleted. <Jan. 27, 2010> |
| Article 31 (Small and Medium Enterprise Business Coordination Council) |
| (1) | The Small and Medium Enterprise Business Coordination Council (hereinafter referred to as the "Coordination Council") shall be established under the jurisdiction of the Minister of SMEs and Startups in order to promote mutually beneficial cooperation between large enterprises and small and medium enterprises and facilitate business coordination provided for in Article 33: Provided, That if the Minister of SMEs and Startups delegates part of his or her authority to the Special Metropolitan City Mayor, a Metropolitan City Mayor, a Special Self-Governing City Mayor, a Do Governor, or a Special Self-Governing Province Governor (hereafter in this Article referred to as the "Special Metropolitan City Mayor, etc.") pursuant to Article 38 (2), the small and medium enterprise business coordination council of a local government (hereinafter referred to as the "local government coordination council") shall be established under the jurisdiction of the Special Metropolitan City Mayor, etc. <Amended on Aug. 6, 2013; Apr. 18, 2017; Jul. 26, 2017> |
| (2) | Matters necessary for the composition and operation of the Coordination Council and local government coordination councils shall be prescribed by Presidential Decree. <Amended on Aug. 6, 2013> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 32 (Application for Business Coordination) |
| (1) | Where an organization of small-medium enterprisers deems that any of the following enterprises has or is likely to have a material adverse effect on the managerial stability of small and medium enterprises by taking over, commencing, or expanding of any business and thereby causing a decrease in the demand for goods and services supplied by a large number of small and medium enterprises of the relevant type of business, it may file an application with the Minister of SMEs and Startups for business coordination via the Korea Federation of Small and Medium Business referred to in Article 3 (1) 4 of the Small and Medium Enterprise Cooperatives Act, as prescribed by Presidential Decree. In such cases, the application date for business coordination shall be deemed the date on which the application for business coordination is accepted by the Korea Federation of Small and Medium Business: Provided, That in cases where the organization of small-medium enterprisers involved in the relevant business type does not exist, the small-medium enterprise of the relevant business type may file an application with the Minister of SMEs and Startups for business coordination via the Korea Federation of Small and Medium Business by obtaining consent from at least a specific ratio of the small and medium enterprises among those engaged in the same business type in the relevant region. In such cases, the scope of the relevant region and the ratio of the small and medium enterprises from which the consent should be obtained shall be prescribed by Presidential Decree: <Amended on Dec. 7, 2010; Mar. 23, 2013; Jul. 26, 2017> |
| 2. | Where a large enterprise directly manages several retail stores of the same business type (which means directly managing stores at its own responsibility and for its own account at the stores it owns or rents; hereinafter the same shall apply), or where it manages any of the following businesses in which it continuously provides management guidance and supplies goods, raw materials, or services to several retail stores of the same business type, a chain store determined by Ordinance of the Ministry of SMEs and Startups which belongs to such business: |
| (a) | Chain business operating company-owned locations: |
Chain business in most cases of which the chain headquarters directly manages retail stores, while continuously supplying goods and providing management guidance to some retail stores under a franchise agreement with the chain headquarters (hereafter in this subparagraph referred to as "member store");
| (b) | Franchise-type chain business: |
Chain business in which the chain headquarters that has developed its own goods or sales and management techniques determines the trade name, the method of sales, the methods of shop management and advertisement, and has its member stores manage shops in compliance with its decision and guidance;
| 3. | A small or medium enterprise determined by Ordinance of the Ministry of SMEs and Startups, which is under the de facto control of a large enterprise. |
| (2) | An application for business coordination referred to in paragraph (1) may be filed before an enterprise referred to in paragraph (1) 1 through 3 (hereinafter referred to as "large enterprise, etc.") takes over, commences, or expands business: Provided, That after the large enterprise, etc. takes over, commences, or expands business, an application for business coordination shall be filed within 180 days from the relevant date. <Amended on Dec. 7, 2010; Aug. 6, 2013> |
| (3) | Upon receipt of the application referred to in paragraph (1), the Korea Federation of Small and Medium Business shall survey the fact, as prescribed by Presidential Decree, and prepare the statement of opinion on the business coordination to submit it to the Minister of SMEs and Startups. <Amended on Jul. 26, 2017> |
| (4) | Upon receipt of the application referred to in paragraph (1), the Minister of SMEs and Startups shall notify the large enterprise, etc. related to the relevant application of the fact. <Amended on Jul. 26, 2017> |
| (5) | Deleted. <Apr. 18, 2017> |
| (6) | The Coordination Council shall complete deliberation on the matters subject to business coordination within one year from the application date for business coordination referred to in paragraph (1): Provided, That where the Minister of SMEs and Startups deems it necessary, such period may be extended by up to one year. <Amended on Jan. 17, 2012; Apr. 18, 2017; Jul. 26, 2017> |
| (7) | Upon receipt of an application for business coordination under Article 20-4 (3), the Coordination Council shall complete deliberation on the relevant business coordination matter within three months from the date of application: Provided, That if deemed necessary by the Minister of SMEs and Startups, such period may be extended only once by up to three months. <Newly Inserted on Aug. 6, 2013; Jul. 26, 2017; Apr. 8, 2017> |
| (8) | Organizations of small-medium enterprisers or small and medium enterprises shall not apply for business coordination referred to in paragraph (1) in cases prescribed by Presidential Decree where a procedure or system with the similar effect as business coordination has been established for the business type or other business subject to approval, authorization, registration, etc. under other statutes or regulations. <Amended on Jan. 17, 2012; Aug. 6, 2013> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 33 (Recommendations and Orders Related to Business Coordination) |
| (1) | Upon receipt of an application for business coordination provided for in Article 32, if it is deemed necessary to secure an opportunity for the business activities of small and medium enterprises of the relevant business type, the Minister of SMEs and Startups may recommend the relevant large enterprise, etc. to postpone the time to acquire, commence, or expand business for a fixed period not exceeding three years or to reduce production items, production quantity, production facilities, etc. subject to deliberation by the Coordination Council: Provided, That if the initial application for business coordination is filed, the Minister of SMEs and Startups may extend the relevant term only once by up to three years subject to deliberation by the Coordination Council and may determine the scope of extension by considering the characteristics of each business type. <Amended on Jul. 26, 2017> |
| (2) | Upon receipt of an application for business coordination provided for in Article 20-4 (3), if it is deemed necessary to secure an opportunity for the business activities of small and medium enterprises of the relevant business type, the Minister of SMEs and Startups may recommend the relevant large enterprise, etc. to transfer the relevant business, withdraw or reduce all or part of the business, or refrain from expanding or entering the business for a fixed period not exceeding three years subject to deliberation by the Coordination Council: Provided, That if an application for extension is filed by the Commission or the relevant organization of small-medium enterprisers (limited to where an application for extension of business coordination is filed via the Commission), the Minister of SMEs and Startups may extend the relevant term only once by up to three years subject to deliberation by the Coordination Council and may determine the scope of extension, in consideration of the characteristics of each business type. <Newly Inserted on Apr. 18, 2017; Jul. 26, 2017> |
| (3) | Where the large enterprise, etc. fails to comply with the recommendation referred to in paragraph (1) or (2), the Minister of SMEs and Startups may publish the subject of recommendation or details thereof. <Amended on Apr. 18, 2017; Jul. 26, 2017> |
| (4) | Where the large enterprise, etc. fails to comply with the recommendation without any justifiable grounds after the publication referred to in paragraph (3) is made, the Minister of SMEs and Startups may order the relevant large enterprise, etc. to comply with such recommendation. <Amended on Apr. 18, 2017; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 34 (Rescindment of Temporary Suspensions and Orders for Coordination) |
| (1) | Upon receipt of an application for business coordination provided for in Article 20-4 (3) or 32 (1), the Minister of SMEs and Startups may recommend the relevant large enterprise, etc. to temporarily suspend acquiring, commencing, and expanding the relevant business until the time he or she notifies the results of deliberation by the Coordination Council to the relevant large enterprise, etc. <Amended on Apr. 18, 2017; Jul. 26, 2017> |
| (2) | Where the large enterprise, etc. fails to comply with the recommendation made by the Minister of SMEs and Startups pursuant to paragraph (1), he or she may publish the subject of recommendation or details thereof. <Amended on Jul. 26, 2017> |
| (3) | Where the recommendation is not implemented without any justifiable grounds even after the publication under paragraph (2) is made, the Minister of SMEs and Startups may order the implementation thereof to the relevant large enterprise, etc., subject to deliberation by the Coordination Council. <Newly Inserted on Aug. 6, 2013; Jul. 26, 2017> |
| (4) | When the Minister of SMEs and Startups issues an order pursuant to Article 33 (4) or (3) of this Article but deems that the grounds for issuing an order are changed or cease to exist before such order is executed, he or she shall rescind all or part of the details of coordination subject to deliberation by the Coordination Council. <Amended on Aug. 6, 2013; Apr. 18, 2017; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 34-2 (Support for Small-Medium Enterprises of Business Type under Business Coordination) |
The Government may support the small and medium enterprises of the business types under business coordination with matters necessary for the improvement in business activities such as upgrading of facilities of small and medium enterprises of the relevant business type, improvement of technology, etc. with the aim of sharpening the competitiveness of the relevant small and medium enterprises, within the budget.
[This Article Newly Inserted on Jan. 7, 2009]
| Article 35 (Transfer of Large Enterprise's Business to Small-Medium Enterprise) |
A large enterprise, etc., which runs any of the following business shall endeavor to transfer such business to any small-medium enterprise for the purpose of increasing industrial efficiency through the rational sharing of the role with small and medium enterprises: <Amended on Jan. 27, 2010; Jul. 26, 2017>
| 1. | Deleted; <Jan. 27, 2010> |
| 2. | The type of business subject to recommendation or order of compliance provided for in Article 33; |
| 3. | Other types of business and the items of business which are recognized by the Minister of SMEs and Startups as being appropriate for small and medium enterprises. |
| Article 36 (Support for Small-Medium Enterprises That Take over Large Enterprises' Businesses) |
The Government may provide the following support to small and medium enterprises that take over the business of large enterprises, etc.: <Amended on Apr. 12, 2010; Dec. 28, 2021>
| 2. | Preferential occupancy of cooperative industrial complexes and knowledge-based industry center, etc.; |
| 3. | Preferential subsidization of technology-development fund, etc. |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 37 (Support for Large Enterprises that Transfer their Businesses) |
When the businesses transferred by a large enterprise, etc. to small and medium enterprises meet the standards prescribed by Presidential Decree, the Government may provide the relevant large enterprise, etc. with financial and taxation support.
[This Article Wholly Amended on Jan. 27, 2010]
CHAPTER VI SUPPLEMENTARY PROVISIONS
| Article 38 (Delegation and Entrustment of Authority or Duties) |
| (1) | Deleted. <Jul. 26, 2017> |
| (2) | The Minister of SMEs and Startups may partially delegate his or her authority bestowed by this Act to the head of the related agency, the Special Metropolitan City Mayor, a Metropolitan City Mayor, a Special Self-Governing City Mayor, a Do Governor, or a Special Self-Governing Province Governor or may entrust part of his or her authority to the competent Ministers by business type, as prescribed by Presidential Decree. <Amended on Aug. 6, 2013; Jul. 26, 2017; Jan. 3, 2023> |
| (3) | The Minister of SMEs and Startups may partially entrust his or her duties under this Act to the Korea Federation of Small and Medium Business, the Korea SMEs and Startups Agency, or the Foundation, as prescribed by Presidential Decree. <Amended on Jul. 26, 2017; Dec. 31, 2018> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 39 (Keeping of Documents) |
| (1) | Commissioning enterprises, commissioned enterprises, or small-medium enterprise cooperatives shall keep the documents pertaining to transactions effected on consignment and commission. |
| (2) | Necessary matters concerning the scope of the documents referred to in paragraph (1) and the period of keeping such documents shall be prescribed by Ordinance of the Ministry of SMEs and Startups. <Amended on Mar. 23, 2013; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 27, 2010]
| Article 40 (Submission of Materials) |
| (1) | If deemed necessary in any of the following cases, the Minister of SMEs and Startups may request the relevant small and medium enterprises or large enterprises, etc. to submit materials and have public officials under his or her control enter offices, places of business, factories, etc. to inspect books, documents, facilities, and other items: <Amended on Jan. 27, 2010; Apr. 18, 2017; Jul. 26, 2017; Jan. 15, 2019; Aug. 17, 2021> |
| 1. | Where he or she intends to ascertain the actual state of transactions effected on consignment and commission provided for in Articles 21, 21-2 (1), 22, 22-2, 23, 24, 24-2, and 25; |
| 2. | Deleted; <Jan. 27, 2010> |
| 3. | Where he or she receives an application for business coordination pursuant to Article 20-4 (3) or 32 (1); |
| 4. | Where he or she finds it necessary to ensure the fairness of transactions effected on consignment and commission and protect the business arena of small and medium enterprises. |
| (2) | Where conducting inspections referred to in paragraph (1), the Minister of SMEs and Startups shall notify the person to be inspected of the inspection plan including the date and time, purposes, details of the inspection, etc. by not later than seven days prior to the scheduled inspection: Provided, That the same shall not apply where the emergent inspection is required and where it is recognized that any prior notice might cause destruction of any evidence, etc. to make it impracticable to attain the purposes of such inspection. <Amended on Jan. 27, 2010> |
| (3) | Public officials who conduct an inspection referred to in paragraph (1) shall carry identification indicating their authority and shall show it to relevant persons and deliver a document stating the names of the relevant public officials, the entry and exit hours, and the purposes of the entry and exit to relevant persons. <Amended on Jan. 27, 2010> |
| (4) | Where any lawsuit is filed to claim damages with regard to the matters prescribed in paragraph (1) under Article 40-2 (1) or (2), a court may request the Minister of SMEs and Startups to send the records of the relevant case as follows: <Newly Inserted on Aug. 17, 2021; Jan. 9, 2024> |
| 1. | Affidavits of persons interested in the case, witnesses, or appraisers; |
| 2. | A complete list of records submitted by the party or obtained from the party in the course of an on-site investigation; |
| 3. | Other investigative records related to the relevant case. |
| Article 40-2 (Liability for Damages) |
| (1) | If any person suffers damage due to a violation of this Act committed by a commissioning enterprise, the commissioning enterprise shall be liable to pay damages to the person: Provided, That the foregoing shall not apply if the commissioning enterprise proves that there was no intent or negligence on its part. |
| (2) | If any person suffers damage due to a violation of Article 25 (1) 1, 3, 7 or 14 or paragraph (2) of the same Article committed by a commissioning enterprise, the commissioning enterprise shall be liable to pay damages to the person within the limit as specified in the following subparagraphs: Provided, That this shall not apply where the commissioning enterprise proves that there was no intent or negligence on its part. <Newly Inserted on Jan. 15, 2019; Aug. 17, 2021; Jan. 9, 2024> |
| 1. | In cases of violating Article 25 (1) 1, 3, 7, 14 (a) (i) or 14 (a): Up to three times the damage sustained by the person; |
| 2. | In cases of violating Article 25 (1) 14 (a) (ii) or paragraph (2) of that Article: Up to five times the damage sustained by the person. |
| (3) | In determining the amount of damage referred to in paragraph (2), a court shall consider the following matters: <Newly Inserted on Jan. 15, 2019; Aug. 17, 2021> |
| 1. | The level of intention and the level of perceiving the likelihood of causing damage; |
| 2. | The scale of damage a commissioned enterprise and other persons have suffered due to a violation; |
| 3. | Economic gains a commissioning enterprise has realized from a violation; |
| 4. | The details of a request for improvement following a violation, recommendations to take corrective measures, or the details of orders to take corrective measures, and whether the violation has been publicized; |
| 4-2. | The severity of a criminal punishment for a violation; |
| 5. | The period and number of violations; |
| 6. | The financial status of a commissioning enterprise; |
| 7. | The degree of endeavors a commissioning enterprise has made to remedy the damage of a commissioned enterprise. |
| (4) | Deleted. <Amended on Aug. 17, 2021> |
[This Article Newly Inserted on Jan. 27, 2016]
| Article 40-3 (Recognition of Damages) |
| (1) | Where a commissioned enterprise files a claim for damages as a commissioning enterprise violates Article 25 (2), a court may recognize any of the following amounts as the amount of damages suffered by the commissioned enterprise: |
| 1. | The aggregate of the following amounts where the commissioning enterprise transfers the goods, etc. that has caused the relevant violation: |
| (a) | The amount calculated by multiplying the quantity not exceeding the quantity of the goods that the commissioned enterprise could have produced, minus the quantity of the goods, etc. actually sold, out of the quantity of the goods, etc. transferred (where the commissioned enterprise could not sell the goods, etc. for any reason other than the violation, the quantity calculated by subtracting the quantity of the goods, etc. not sold for such reason other than the violation), by profits per unit quantity of the goods, etc. that the commissioned enterprise could have sold if there had been no such violation; |
| (b) | With respect to the quantity not calculated under item (a) out of the quantity of the goods, etc. transferred, a reasonable amount to be paid for the use of the technical data; |
| 2. | A reasonable amount to be paid for the use of technical data; |
| 3. | Where the commissioning enterprise gains profits from its violation, the amount of such profits. |
| (2) | Where a court finds, in a lawsuit filed to claim damages under Article 40-2 (1) or (2), that damage has been incurred but it is extremely impracticable to verify the facts necessary to substantiate the relevant damages in light of the nature of the relevant facts, it may award reasonable damages based on the purport of entire arguments and the results of examination of evidence. |
[This Article Newly Inserted on Aug. 17, 2021]
[Previous Article 40-3 moved to Article 40-6 <Aug. 17, 2021>]
| Article 40-4 (Obligation to Present Specific Type of Behavior) |
| (1) | A commissioning enterprise who denies a specific type of behavior related to the act of misusing technical data, as asserted by a commissioned enterprise, in a lawsuit filed to claim damages with regard to a violation of Article 25 (2) shall present his or her own specific type of behavior: Provided, That the same shall not apply where the commissioning enterprise has a reasonable ground for being unable to do so. |
| (2) | Where a commissioning enterprise argues that it has a reasonable ground for being unable to present his or her own specific type of behavior under paragraph (1), a court may order the relevant party to submit materials to judge whether such argument is right: Provided, That the same shall not apply where the possessor of such materials has good reason for refusing to submit them. |
| (3) | Article 40-5 (2), (3), and (8) shall apply mutatis mutandis to orders to submit materials under paragraph (2). In such cases, "when it is necessary to prove whether a violation exists or to calculate damages" in the former part of Article 40-5 (3) shall be construed as "when it is necessary to judge whether there exists any good reason for being unable to present a specific type of behavior related to the act of misusing technical data". |
| (4) | Where any good reason under the proviso of paragraph (2) is deemed not to exist, a court may order the presentation of a specific type of behavior. An immediate appeal may be made against such order. |
| (5) | Where a commissioning enterprise fails to present a specific type of behavior without good reason, a court may recognize that the specific type of behavior claimed by a commissioned enterprise is true. |
[This Article Newly Inserted on Aug. 17, 2021]
| Article 40-5 (Orders to Submit Materials) |
| (1) | In a lawsuit filed to claim damages under Article 40-2 (1) or (2), a court upon application by a party to such lawsuit may order the other party to submit the following materials necessary to prove whether the relevant violation exists or to calculate such damages: Provided, That the same shall not apply where the possessor of such materials has good reason to refuse submission of such materials: |
| 1. | Information stored in the electronic medium, including a document, text, picture, graph, table, photograph, voice recorded, image, or other data or database, which is held or kept by or under the control of the other party and can be acquired directly from the relevant medium or converted into a reasonably available form as necessary; |
| 2. | Other designated tangible objects. |
| (2) | Where any possessor of materials argues that he or she has good reason to refuse submission of materials pursuant to paragraph (1), a court may order him or her to submit them to judge whether such argument is right. In such cases, the court shall not allow other persons to inspect the materials. |
| (3) | Where the materials that shall be submitted pursuant to paragraph (1) constitute trade secret (referring to the trade secret defined in subparagraph 2 of Article 2 of the Unfair Competition Prevention and Trade Secret Protection Act) but they are necessary to prove whether a violation exists or to calculate the amount of damages, any good reason under the proviso, with the exception of the subparagraphs, of paragraph (1) shall be deemed not to exist. In such cases, a court shall designate a scope within which inspection of materials is allowed or a person allowed to inspect materials within the purpose of an order to submit them. |
| (4) | Where a party fails to comply with an order to submit materials without good reason, a court may recognize that the argument on the description of such materials of the other party who applies for submission thereof is true. |
| (5) | Where a party destroys the materials that he or she is obligated to submit for the purpose of hindering the other party from using them or makes them unusable, a court may recognize that the argument of the other party on the description of materials is true. |
| (6) | In cases falling under paragraph (4), where there exists an extenuating circumstance that makes it significantly difficult for a party who applies for submission of materials to make a specific argument on the description of such materials and it is impracticable to expect that other evidence prove the facts to be substantiated by the materials, a court may recognize that the argument of the party on the facts which he or she intends to prove through the description of the materials is true. |
| (7) | No person who is provided with or inspects materials pursuant to paragraph (3) shall use such materials for purposes other than the intended purpose of ordering submission thereof or for any wrongful purpose such as providing them to a third party. |
| (8) | An immediate appeal may be made against any decision with regard to an application for submission of materials. |
[This Article Newly Inserted on Aug. 17, 2021]
| Article 40-6 (Legal Fiction as Public Officials for Purposes of Applying Penalty Provisions) |
| 1. | A member of the Coordination Council and local government coordination councils; |
| 2. | A member of the Dispute Mediation Council. |
[Newly Inserted on Dec. 31, 2018]
[Moved from Article 40-2 <Aug. 17, 2021>]
CHAPTER VII PENALTY PROVISIONS
| Article 41 (Penalty Provisions) |
| (1) | A person who acquires another person's technical data by improper means, including theft, and registers it pursuant to Article 24-3 shall be punished by imprisonment with labor for up to five years, or by a fine equivalent to the amount which is at least twice but not more than 10 times the proprietary gains resulting therefrom. |
| (2) | A person who fails to comply with an order issued pursuant to Article 33 (4) shall be punished by imprisonment with labor for up to two years, or by a fine not exceeding 150 million won. <Newly Inserted on Aug. 6, 2013; Apr. 18, 2017> |
| (3) | Any of the following persons shall be punished by imprisonment with labor for not more than one year or by a fine not exceeding 50 million won: <Amended on Aug. 6, 2013; Jan. 27, 2016; Oct. 20, 2020; Aug. 17, 2021> |
| 1. | A person who violates a duty of confidentiality under Article 24-4; |
| 1-2. | A person who fails to comply with an order under Article 27 (2) (including cases where the same paragraph is applied mutatis mutandis in Article 27 (4)) until one month after the publication under Article 27 (3) (including cases where the same paragraph is applied mutatis mutandis in Article 27 (4)); |
| 2. | A person who fails to comply with a corrective order under Article 28 (3) until one month after the publication provided for in the main clause of Article 28 (4) is made; |
| 3. | Deleted; <Aug. 6, 2013> |
| 4. | A person who divulges or provides information or materials to any third person or uses such information or materials for any wrongful purpose, in violation of Article 40-5 (7). |
[This Article Wholly Amended on Dec. 7, 2010]
| Article 42 (Joint Penalty Provisions) |
If the representative of a corporation or an agent or employee of, or any other person employed by, a corporation or an individual commits any violation referred to in Article 41 in conducting the business affairs of the corporation or individual, the corporation or individual shall, in addition to punishing the violator accordingly, be punished by a fine prescribed in the relevant provision: Provided, That the same shall not apply, where such corporation or individual has not been negligent in giving due attention and supervision concerning the relevant business affairs to prevent such violation. <Amended on Jan. 7, 2009>
| Article 43 (Administrative Fines) |
| (1) | A person who fails to comply with an order referred to in Article 34 (3) shall be subject to an administrative fine not exceeding 100 million won. <Amended on Apr. 18, 2017; Oct. 20, 2020> |
| (2) | Any of the following persons shall be subject to an administrative fine not exceeding 50 million won: <Newly Inserted on Aug. 17, 2021; Jan. 3, 2023> |
| 1. | A person who fails to submit materials referred to in Article 40, submits false materials, or refuses, obstructs, or evades an inspection; |
| (3) | Any of the following persons shall be subject to an administrative fine not exceeding 10 million won: <Amended on Apr. 18, 2017; Jan. 15, 2019; Aug. 17, 2021> |
| 1. | A person who fails to issue a written agreement referred to in Article 21 (1); |
| 2. | A person who fails to enter into a confidentiality agreement referred to in Article 21-2 (1). |
| (4) | Any of the following persons shall be subject to an administrative fine not exceeding five million won: <Newly Inserted on Apr. 18, 2017; Nov. 28, 2017; Aug. 17, 2021; Mar. 28, 2023> |
| 1. | A person who fails to prepare and keep the minutes referred to in Article 20-2 (5); |
| 2. | A person who fails to perform measures, such as a training order referred to in Article 28-4; |
| 3. | A person who fails to keep documents referred to in Article 39 (1) or has entered false matters in the documents. |
| (5) | Administrative fines referred to in paragraphs (1) through (4) shall be imposed and collected by the Minister of SMEs and Startups, as prescribed by Presidential Decree. <Amended on Jan. 27, 2010; Aug. 6, 2013; Apr. 18, 2017; Jul. 26, 2017; Aug. 17, 2021> |
ADDENDA <Act No. 7864, Mar. 3, 2006>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation.
Article 2 (Repeal of Other Acts)
Article 3 (General Transitional Measures)
Article 4 (Period of Validity) The provisions of Articles 29, 30, subparagraph 1 of 35, 40 (1) 2 and subparagraphs 2 and 3 of 41 shall be valid on or before December 31, 2006 and the "business other than the inherent type of business" in Article 32 (1) shall be made the "business" beginning on January 1, 2007.
Article 5 (Transitional Measures concerning Consultative Council of Commissioned Enterprises)
The consultative council of commissioned enterprises provided for in the provisions of Article 17 of the previous Act at the time of the enforcement of this Act shall be deemed the consultative council of commissioned enterprises provided for in the provisions of Article 17. Article 6 (Special Cases concerning Large and Small Business Cooperation Foundation)
The Large and Small Business Cooperation Foundation that has been established pursuant to the provisions of Article 16 of the previous Act shall be deemed the Foundation provided for in the provisions of Article 20. Article 7 (Transitional Measures concerning Arbitration of Disputes)
The dispute case for which an application is filed for its arbitration pursuant to the provisions of Article 25 of the previous Act and which is pending at the time of the enforcement of this Act shall be deemed the dispute for which an application is filed for its arbitration pursuant to the provisions of Article 28. Article 8 (Transitional Measures concerning Business Coordination)
The application filed for the business coordination, the recommendation made and the order issued for the business coordination and the recommendation made for the temporary suspension pursuant to the provisions of Articles 6 through 8 of the previous Act at the time of the enforcement of this Act shall be all deemed to be filed, made, issued and made pursuant to the provisions of Articles 32 through 34. Article 9 (Transitional Measures concerning Inherent Types of Business of Small-Medium Enterprises)
| (1) | The inherent types of business of small and medium enterprises, which are designated pursuant to the provisions of Article 3 (1) of the previous Act at the time of the enforcement of this Act shall be deemed to be designated pursuant to the provisions of Article 29 (1). |
| (3) | Anyone who has failed to make a report required by the provisions of paragraph (2) shall be punished by an administrative fine not exceeding five million won and the provisions of Article 43 (2) through (5) shall apply mutatis mutandis to the procedures and methods for imposing and collecting the administrative fine. |
Article 10 (Transitional Measures concerning Penalty Provisions, etc.)
The application of the penalty provisions and administrative fines to the act performed prior to the enforcement of this Act shall be governed by the provisions of the previous Act.
Article 11 Omitted.
ADDENDA <Act No. 8108, Jun. 28, 2006>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 Omitted.
Article 3 Omitted.
Article 4 Omitted.
ADDENDUM <Act No. 8454, May 17, 2007>
This Act shall enter into force three months after the date of its promulgation: Provided, That the amended provisions of Article 32 (1) shall enter into force on the date of its promulgation.
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, ... <omitted> ... among the Acts amended pursuant to Article 6 of the Addenda, the amendments to the Acts promulgated before this Act enters into force, but the enforcement dates of which have yet to arrive, shall enter into force on the dates on which the respective Acts take effect. Articles 2 through 7 Omitted.
ADDENDA <Act No. 9013, Mar. 28, 2008>
| (1) | (Enforcement Date) This Act shall enter into force six months after the date of its promulgation. |
ADDENDA <Act No. 9331, Jan. 7, 2009>
| (1) | (Enforcement Date) This Act shall enter into force on the date of its promulgation. (Proviso Omitted.) |
| (2) | (Transitional Measures concerning Business Coordination) The application for business coordination or the recommendation on or the order for business coordination filed and made before this Act enters into force shall be deemed the application for business coordination or the recommendation on or the order for business coordination under this Act. |
ADDENDA <Act No. 9931, Jan. 13, 2010>
Article 1 (Enforcement Date)
This Act shall enter into force three months from the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDUM <Act No. 9978, Jan. 27, 2010>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 10252, Apr. 12, 2010>
Article 1 (Enforcement Date)
This Act shall enter into force three months from the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDA <Act No. 10399, Jun. 7, 2010>
| (1) | (Enforcement Date) This Act shall enter into force on the date of its promulgation. (Proviso Omitted.) |
| (2) | (Applicability concerning Application for Business Coordination) The amended provisions of Article 32 (1) shall apply where an application for business coordination is filed on or after the date this Act enters into force. |
ADDENDA <Act No. 11173, Jan. 17, 2012>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures concerning National Commission for Corporate Partnership)
| (1) | The National Commission for Corporate Partnership established in accordance with the articles of association of the Foundation as at the time this Act enters into force shall be deemed established pursuant to the amended provisions of Article 20-2. |
| (2) | The suitable types of business on which consensus has been secured by the National Commission for Corporate Partnership, which was established in accordance with the articles of association of the Foundation before this Act enters into force, shall be deemed agreed upon and published pursuant to the amended provisions of Article 20-2 (2) 2. |
ADDENDA <Act No. 11690, Mar. 23, 2013>
Article 1 (Enforcement Date)
This Act shall enter into on the date of its promulgation.
Articles 2 through 7 Omitted.
ADDENDA <Act No. 12002, Aug. 6, 2013>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided, That the amended provisions of Articles 8 (1), 15 (3), 17 (3) and 25-2 shall enter into force on the date of its promulgation. Article 2 (Applicable Cases concerning Business Coordination for Suitable Types of Business)
The amended provisions of Article 32 (7) shall begin to apply from the first business coordination for which an application is filed after this Act enters into force.
ADDENDA <Act No. 12307, Jan. 21, 2014>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 6 Omitted.
ADDENDUM <Act No. 12498, Mar. 18, 2014>
This Act shall enter into force on the date of its promulgation.
ADDENDUM <Act No. 13732, Jan. 6, 2016>
This Decree shall enter into force three months after the date of its promulgation.
ADDENDUM <Act No. 13839, Jan. 27, 2016>
This Act shall enter into force on the date of its promulgation: Provided, That the amended provisions of Article 28 (2) shall enter into force three months after the date of its promulgation.
ADDENDA <Act No. 14529, Jan. 17, 2017>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation: Provided, That the amended provisions of Articles 17 (3) and 20 shall enter into force on the date of its promulgation. Article 2 (Transitional Measures concerning Large and Small Business Cooperation Foundation)
As at the time the amended provisions of Article 20 enter into force, the Large and Small Business Cooperation Foundation established under the former provisions of Article 20 shall be construed as the Large and Small Business, Agriculture, and Fisheries Cooperation Foundation established under the amended provisions of Article 20.
ADDENDA <Act No. 14775, Apr. 18, 2017>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Transitional Measures concerning Application for Consensus on Suitable Types of Business)
With regard to an application for which the Commission is in the process of reaching a consensus on suitable types of business as at the time this Act enters into force, the Commission shall reach a consensus within one year after this Act enters into force; and where no consensus is reached on suitable types of business within one year, an application for business coordination may be filed under the amended provisions of Article 20-4 (3).
ADDENDA <Act No. 14839, Jul. 26, 2017>
Article 1 (Enforcement Date)
This Act shall enter into on the date of its promulgation: Provided, That, among the Acts amended pursuant to Article 5 of the Addenda, the amendments to the Acts promulgated before this Act enters into force, but the enforcement dates of which have yet to arrive, shall enter into force on the dates on which the respective Acts take effect. Articles 2 through 6 Omitted.
ADDENDUM <Act No. 15081, Nov. 28, 2017>
This Act shall enter into force six months after the date of its promulgation.
ADDENDA <Act No. 15519, Mar. 20, 2018>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided, That the amended provisions of Article 20-4 (2) shall enter into force on the date of its promulgation. Article 2 (Applicability to Mutually-Beneficial Settlement)
The amended provisions of Article 22 (5) shall begin to apply from the first contract for commissioning the manufacture of goods, etc. concluded after this Act enters into force.
ADDENDA <Act No. 15687, Jun. 12, 2018>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 Omitted.
Article 3 Omitted.
ADDENDUM <Act No. 16168, Jun. 31, 2018>
This Decree shall enter into force three months after the date of its promulgation.
ADDENDA <Act No. 16172, Jun. 31, 2018>
Article 1 (Enforcement Date)
This Act shall enter into force three months from the date of its promulgation. (Proviso Omitted.)
Articles 2 through 5 Omitted.
ADDENDA <Act No. 16290, Jan. 15, 2019>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided, That the amended provisions of subparagraph 11 of Article 2 shall enter into force on the date of its promulgation. Article 2 (Applicability to Burden of Proof by Commissioning Enterprise)
The amended provisions of Article 25-2 shall begin to apply from the first request for mediation of a dispute made under Article 28 or from the first lawsuit filed to claim compensation, after this Act enters into force.
ADDENDUM <Act No. 16996, Feb. 11, 2020>
This Act shall enter into force six months after the date of its promulgation.
ADDENDA <Act No. 17555, Oct. 20, 2020>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Transitional Measures concerning Improvements in Unfair Trade Practices)
Notwithstanding the amended provisions of Article 27, the previous provisions shall apply to violations committed before this Act enters into force. Article 3 Omitted.
ADDENDA <Act No. 17799, Dec. 29, 2020>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 26 Omitted.
ADDENDA <Act No. 18431, Aug. 17, 2021>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Applicability to Conclusion of Confidentiality Agreements)
The amended provisions of Article 21-2 (1) shall begin to apply where a commissioned enterprise provides technical data managed confidentially to a commissioning enterprise on or after the date this Act enters into force. Article 3 (Applicability to Liability for Damages)
The amended provisions of Articles 40-2 (2), 40-3 (1), and 40-4 shall begin to apply where a commissioning enterprise violates the amended provisions of Article 25 (2) on or after the date this Act enters into force.
ADDENDUM <Act No. 18512, Oct. 19, 2021>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 18661, Dec. 28, 2021>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 8 Omitted.
ADDENDA <Act No. 19176, Jan. 3, 2023>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided, That the amended provisions of Article 21 (1) 4, paragraphs (2) through (4) of the same Article, and Articles 25 (1) 1-2 and 14, 28 (1) 1, and 43 (2) 2 shall enter into force nine months after the date of its promulgation. Article 2 (Applicability to Linkage of Price of Delivered Goods)
The amended provisions of Article 21 shall begin to apply to the first contract concluded or renewed by any commissioning enterprise on the entrustment of manufacturing goods, etc. with any commissioned enterprise after this Act enters into force.
ADDENDA <Act No. 19317, Mar. 28, 2023>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided, That the amended provisions of Article 20 (2) 7 shall enter into force on the date of its promulgation. Article 2 (Applicability to Reduction of or Exemption from Demerit Points)
The amended provisions of Article 28-3 shall begin to apply where the Minister of SMEs and Startups commences an inspection under Article 40 after this Act enters into force. Article 3 (Applicability to Effect of Interruption of Prescription and Mediation by Dispute Mediation Council)
The amended provisions of Articles 28-9 (4) through (6) and 28-10 shall begin to apply where the parties file an application for dispute mediation with the Dispute Mediation Council after this Act enters into force. Article 4 Omitted.
ADDENDUM <Act No. 19502, Jun. 20, 2023>
This Act shall enter into force on the date of its promulgation.
ADDENDUM <Act No. 19821, Oct. 31, 2023>
This Act shall enter into force one year after the date of its promulgation.
ADDENDA <Act No. 19989, Jan. 9, 2024>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided, That the amended provisions of Article 22-2 (2) shall enter into force on the date of its promulgation. Article 2 (Applicability to Deletion of Requirements for Request for Adjustment Consultation)
The amended provisions of Article 22-2 (2) shall also apply to cases where a small and medium enterprise cooperative has applied for consultation on the adjustment of the price of delivered goods at the time of the enforcement of such amended provisions. Article 3 (Applicability to Burden of Proof by Commissioning Enterprise)
The amended provisions of Article 25-2 shall begin to apply to the first request for mediation of a dispute made under Article 28 or to the first lawsuit filed to claim compensation after this Act enters into force. Article 4 (Applicability to Request for Submission of Records Made by Court)
The amended provisions of Article 40 (4) shall also apply to cases pending in court as at the time this Act enters into force. Article 5 (Applicability to Liability for Damages)
The amended provisions of Article 40-2 (2) shall begin to apply to violations committed after this Act enters into force.