Amendment to the Enforcement Decree of the Small Business Act Passed at the Cabinet Meeting on the 17th
Maximizing Use of Administrative Data in Advance...Preliminary Review of Compensation
Private Experts Participate in Review Committee..."Expecting Objective Review"
[Asia Economy Reporter Kim Bo-kyung] Detailed regulations related to the loss compensation system that compensates for losses caused by COVID-19 quarantine measures have passed the Cabinet meeting. The government plans to prepare meticulously so that payments can begin by the end of October through prior review before the compensation application.
The Ministry of SMEs and Startups announced on the 17th that the amendment to the 'Enforcement Decree of the Small Business Act,' which specifies the details of the loss compensation system, has passed the Cabinet meeting. This is a follow-up measure for the enforcement of the amended Small Business Act promulgated in July, concretizing the matters stipulated in the law.
The amendment to the enforcement decree stipulates the scope of loss compensation, rapid payment procedures, and the composition and operation plan of the Loss Compensation Deliberation Committee.
First, the loss compensation target measures are the government's direct quarantine measures, such as business suspension and operating hour restrictions.
In other words, it applies when serious business losses occur due to measures that prohibit gatherings within business premises (business suspension) or restrict part of the operating hours (operating hour restrictions) under the Infectious Disease Control and Prevention Act.
Indirect damages caused by quarantine measures and business losses due to measures such as spaced seating and personnel limits are difficult to be compensated.
A basis for prior review to expedite the payment of compensation has also been established.
Typically, loss compensation proceeds through a process of calculating and reviewing the compensation amount after the application. However, the government plans to utilize administrative data it holds as much as possible even before the application to pre-review and calculate the compensation amount. This is expected to significantly shorten the period from application to payment.
The qualifications of participants in the Loss Compensation Deliberation Committee have also been specified.
The chairperson is the Vice Minister of the Ministry of SMEs and Startups, and ex officio members include senior officials from seven ministries such as the Ministry of Economy and Finance, Ministry of the Interior and Safety, Ministry of Health and Welfare, Office for Government Policy Coordination, and National Tax Service.
Appointed members include not only those recognized as representatives in the small business sector but also experts in loss compensation and quarantine, as well as legal professionals. A Ministry of SMEs and Startups official stated, "We expect rational and objective deliberations through the participation of private experts from various fields."
Specifically, the qualifications for appointed members include ▲ heads of specialized institutions and related organizations in the fields of loss compensation or quarantine ▲ professors, associate professors, or assistant professors with more than 10 years of service in the fields of loss compensation or quarantine ▲ judges, prosecutors, military legal officers, or lawyers with more than 10 years of service ▲ persons affiliated with small business-related organizations recognized as representatives in the small business sector ▲ and others whom the Minister of SMEs and Startups recognizes as having abundant knowledge and experience in loss compensation, quarantine, or small business-related fields.
Details on the compensation calculation method, payment procedures, and other standards will be announced by the Minister of SMEs and Startups after deliberation by the Loss Compensation Deliberation Committee scheduled for October 8, the enforcement date of the law.
Park Chi-hyung, Director of Small Business Policy at the Ministry of SMEs and Startups, said, "The small business loss compensation system is the first institutional foundation to systematically compensate small business owners for losses caused by quarantine measures, and it is a very advanced case that is hard to find legislative precedents for worldwide."
He added, "We will prepare quickly and flawlessly so that compensation applications and payments can begin by the end of October, working closely with related ministries and local governments."
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