[Asia Economy Reporter Changhwan Lee] A personalized health supplement recommendation and sales service (health supplements packaged in small portions and delivered according to one’s health status and lifestyle) and a shared beauty salon have passed the Korea Chamber of Commerce and Industry (KCCI) and Ministry of Trade, Industry and Energy sandbox and are newly opening.
The KCCI Sandbox Support Center and the Ministry of Trade, Industry and Energy announced on the 27th that they held the ‘Industrial Convergence Regulatory Special Cases Deliberation Committee’ in writing and approved a total of 11 cases, including ‘personalized health functional food recommendation and sales’ (9 cases) and ‘shared beauty salons’ (2 cases).
This deliberation committee applied a ‘Fast Track’ considering rapid commercialization and the COVID-19 situation. For projects similar to previously approved sandbox cases, the expert committee and other steps were omitted and handled in writing. Personalized health functional food recommendation and sales were approved for demonstration exemption in April, and shared beauty salons in June for similar business models.
A KCCI official said, “Typically, sandbox deliberations go through review by related ministries, expert committees, and face-to-face special deliberation meetings after submission, but this time, similar projects were grouped and quickly reviewed in writing.” The average period from submission to approval for these 11 projects was about 42 days, with the shortest period being 13 days.
KCCI explained that with the sandbox approval of the personalized health supplement recommendation and sales service, more consumers will be able to receive their own nutritional supplements delivered to their homes.
Consumers provide a questionnaire containing their health status and lifestyle patterns along with ‘genetic test results’ requested by the consumer. Companies analyze this information and recommend health functional foods that need supplementation, then sell them online packaged in portions suitable for one-time consumption. Consumers visit an offline store once for the initial purchase, after which regular purchases can be made online.
The companies approved this time to provide this service are nine in total: Green Cross Wellbeing, Nuritelecom, Dawon H&B, Bioeleven, Onnuri H&C, Unibio, ToBeCon, Korea Yakult, and Hanpoong Naturefarm. They received a two-year demonstration exemption.
Under current laws and systems, such business models were not possible. Therefore, the sandbox deliberation committee granted additional demonstration exemptions to prevent misuse of health functional foods and enhance consumer convenience. The Ministry of Food and Drug Safety, the competent authority, plans to fully allow small-portion sales of health functional foods by revising the ‘Health Functional Food Act Enforcement Rules’ next year if no issues arise during the demonstration project.
The ‘shared beauty salon’ platform companies (Bentlespace, VirtuLive, etc., two companies) will also enter sandbox testing additionally. A shared beauty salon is a platform where multiple hairdressers reside in one beauty salon business location and share facilities such as shampoo rooms and perm machines. Hairdressers can start a business by paying only a fixed membership fee without separate costs such as key money or interior expenses. The platform operator supports commercialization by providing space, facilities, beauty materials, and marketing to hairdressers.
Current Public Hygiene Management Act (Enforcement Rule Article 2) restricts ‘joint use of beauty business facilities.’ This is due to concerns that sharing beauty tools and facilities may be unhygienic and pose fire risks. The deliberation committee granted a ‘demonstration exemption’ on the condition of compliance with safety and hygiene guidelines. The Ministry of Health and Welfare, the competent authority, announced plans to fully allow shared beauty salons by revising related regulations in the second half of next year if no problems arise during the demonstration project.
Meanwhile, the KCCI Sandbox Support Center is the first private sandbox organization in Korea. It supports all industrial sectors including industrial convergence, ICT convergence, and financial innovation sandboxes. Since its launch in May, it has supported market launches for 24 innovative products and services. Additionally, it has processed 25 cases through rapid confirmation that verifies regulatory status of innovative businesses within 30 days.
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