Delivery Price Adjustment Committee, "Measures Needed to Prevent Retaliation Against Consignment Companies"

Discussion on Measures to Activate 'Korea Federation of SMEs Delivery Payment Adjustment Negotiations' Scheduled for April This Year
Chairman Seo Byeongmun: "Efforts to Spread the Culture of Receiving Fair Delivery Prices"

(From the front row, left to right) Jo Yong-jun, Chairman of the Korea Pharmaceutical Cooperative / Song Yoo-kyung, Chairman of the Gyeonggi Southern Supermarket Cooperative / Han Byung-jun, Chairman of the Korea Information Industry Cooperative / Bae Jo-ung, President of the Korea Ready-Mixed Concrete Industry Cooperative Federation / Seo Byung-moon, Chairman (Chairman of the Korea Foundry Industry Cooperative) / Noh Jae-geun, President of the Korea Metal Furniture Industry Cooperative Federation / Seo Seung-won, Executive Vice President of the Korea Federation of SMEs / Choi Sang-rok, Executive Director of the Korea Productivity Center / Lee Jung-heon, Director of the Korea Institute of Certified Public Accountants.
[Photo by Korea Federation of SMEs]

[Asia Economy Reporter Kim Jong-hwa] Ahead of the April implementation of the revised "Act on the Promotion of Mutual Cooperation between Large, Medium, and Small Enterprises (Mutual Cooperation Act)" last year, a forum for smooth operation of the system was held.

The Korea Federation of SMEs (Chairman Kim Ki-moon) held the "2021 1st Large, Medium, and Small Enterprises Supply Price Adjustment Committee" at the Federation of SMEs on the 5th.

The revised Mutual Cooperation Act, amended on September 24 last year, will be enforced from April. At the meeting, it was discussed that, according to the revised law, the Federation of SMEs can directly negotiate supply price adjustments with large enterprises on behalf of small enterprises and small enterprise cooperatives, and proposals for amendments to the enforcement decree for smooth prior preparation and future system operation directions were made.

Industry experts attending the meeting agreed that the current enforcement decree of the Mutual Cooperation Act imposes strict requirements for small enterprise cooperatives to apply for supply price adjustments through the Federation of SMEs, and that measures to prevent retaliatory actions by consigning companies should be established.

Specifically, the following measures were proposed: △ easing the requirements for application for adjustment consultation (such as resolutions by general meetings and boards of directors), △ relaxing the conditions for adjustment consultation eligibility (such as a certain standard increase in raw material costs, labor costs, and other expenses), △ reflecting industry-specific characteristics, and △ providing incentives and penalties to consigning companies (large enterprises) to strengthen enforceability.

Seo Byung-moon, Chairman of the Large, Medium, and Small Enterprises Supply Price Adjustment Committee, said, "The polarization of economic agents is expected to deepen due to COVID-19," and added, "We will strive to spread the culture of 'getting fair prices for supply prices' so that small enterprises receive appropriate compensation for their efforts and large, medium, and small enterprises can grow together in a virtuous economic cycle."