Industry 'Tailwind' Following Passage of Venture Business-Related Legislation

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[Asia Economy Reporter Kim Cheol-hyun] The passage of the 'Venture Business Special Act Amendment', 'Venture Investment Promotion Act', and the 'Data 3 Laws (Personal Information Protection Act, Credit Information Act, and Information and Communications Network Act Amendments)' in the National Assembly is bringing a fresh breeze to the industry. These bills are expected to promote the founding and growth of various venture companies with excellent innovation and high potential.

According to the Venture Business Association on the 12th, the passage of the 'Venture Business Special Act', which reorganizes the venture business verification system from a market-friendly perspective led by the private sector, the 'Venture Investment Promotion Act', which reduces regulations related to venture investment, and the 'Data 3 Laws' for data openness and utilization has established a foundation to enhance the professionalism and fairness of the venture business verification process and activate the data economy. In particular, the guarantee and loan types, which accounted for more than 80% of the existing venture business verification types, have been abolished, opening the way for companies to be recognized as venture businesses if they are evaluated as having excellent innovation and growth potential.

Venture capitalists (VCs) are especially hopeful about the 'Venture Investment Promotion Act'. Since the 'Small and Medium Enterprise Startup Support Act', which provided the basis for establishing small and medium enterprise startup investment companies, one of the types of domestic VC companies, was enacted in 1986, this marks the first legal system unique to the venture capital industry in about 35 years, creating a new turning point for the small and medium venture industry.

The main purpose of this law is to create a private-led startup ecosystem by easing entry barriers to venture investment and systematically fostering the investment environment. To this end, it includes market-friendly contents such as the integration and unification of venture investment laws scattered across various corporate-related laws and the relaxation of the mandatory investment ratio for venture associations. Jung Sung-in, chairman of the Korea Venture Capital Association, said, "With the passage of the Venture Investment Promotion Act, we expect a major transformation in economic innovation as venture investment performance and unicorn company achievements expand further."