[Asia Economy Reporter Junhyung Lee] Cooperatives, business cooperatives, and cooperative federations under the 'Small and Medium Enterprise Cooperative Act' are also recognized as small and medium enterprises (SMEs).
The Ministry of SMEs and Startups announced that the amendment to the Enforcement Decree of the Framework Act on Small and Medium Enterprises, which includes this content, will take effect from the 21st.
With this amendment, SME cooperatives that meet certain criteria such as average sales and total assets will be recognized as SMEs. They must satisfy three conditions: ▲average sales over the past three years below the industry-specific sales standard ▲total assets under 500 billion KRW, among others.
This amendment is part of institutional improvements to support collaboration among SME cooperatives. Until now, SME cooperatives faced restrictions in participating in government and local government support projects for SMEs, limiting collaboration among companies. A representative from the Korea Federation of SMEs stated, "SME cooperatives encountered legal limitations when trying to promote joint projects for tasks difficult for individual companies to handle alone, causing difficulties in project implementation."
The Ministry of SMEs and Startups expects this amendment to also improve policy efficiency. Supporting one SME cooperative can benefit many SME members.
Jokyungwon, Director of Policy Coordination at the Ministry of SMEs and Startups, said, "Cooperatives will be able to utilize various SME support policies, which is expected to serve as an opportunity to revitalize joint projects," adding, "We will expand effective policy support so that cooperatives can feel the impact, helping to resolve funding difficulties and expand sales channels."
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