[Column] "No Plans to Replace Anchovies with Hanwoo Beef"... Belated Temporary Easing of the Cheongtak Prohibition Act

"Timing, Policy Targets, and Effects All Poor: Desk-bound Administration"

[Asia Economy Reporter Moon Chaeseok]

"This Chuseok, we plan to give employees anchovy gift sets worth 20,000 to 30,000 KRW. Due to the impact of COVID-19, we are barely maintaining a profit. Just because the government policy changes, can we switch anchovies to Korean beef?" (Financial sector Company A)

"To give Chuseok gifts, preparations need to start at least six weeks before the holiday, but the revision of the Enforcement Decree of the Act on the Prohibition of Improper Solicitation and Graft (Improper Solicitation and Graft Act) was made only 20 days before the holiday. We need to send all gifts before the 'delivery chaos,' but the government’s policy came out too late." (Financial sector Company B)

This year, the revision of the Enforcement Decree of the Improper Solicitation and Graft Act, which raises the gift limit for agricultural, livestock, and fishery products from 100,000 KRW to 200,000 KRW for Chuseok, was passed at the Cabinet meeting on the 10th. Farmers suffering from the longest rainy season and successive typhoon damage, and the distribution industry struggling with consumption stagnation, clearly welcome this change.

However, the reaction from companies, who actually have to spend the money, is lukewarm. On the ground, there are many criticisms that the timing is too late.

Companies plan gift giving by ▲contracting with suppliers through competitive bidding or ▲reporting catalogs obtained from department stores to the budget department. To avoid the delivery chaos two weeks before the holiday, the process takes more than a month.

Moreover, the related budget is set in advance in November to December of the previous year. To give gifts exceeding the amount reported the previous year, companies must get approval again from the budget and internal control departments regarding the changed costs and contract conditions.

An official from a pharmaceutical company said, "Maybe for next year’s Lunar New Year holiday, but not many companies will change gifts from 99,000 KRW to 199,000 KRW this Chuseok. It is also doubtful whether companies like ours, which give gifts other than agricultural, livestock, and fishery products such as health functional foods, will change their gift items."

With management difficulties already high due to COVID-19, not many companies are likely to respond positively to the increased gift limit. Since the policy targets 'persons related to the Improper Solicitation and Graft Act,' it is also difficult to expect domestic demand activation like emergency disaster relief funds or premium efficiency home appliance purchase rebate programs. It is said to be a sudden, desk-based administration without thorough preparation.

Although the Anti-Corruption and Civil Rights Commission showed a rare willingness to listen to the appeals of the market and companies, it is also true that there are many regrets in various aspects.