'Semiconductor Special Act' Approved at Cabinet Meeting... Comprehensive Support for Investment, R&D, and Workforce

'Special Act on National Advanced Strategic Industries'... Initiation of Strategic Technology Selection in Q1

Minister Moon Seung-wook of the Ministry of Trade, Industry and Energy is delivering a keynote speech at the Special Committee on Semiconductor Technology held at the National Assembly on the 15th. Photo by Yoon Dong-joo doso7@

[Sejong=Asia Economy Reporter Kwon Haeyoung] Legal grounds have been established to provide unprecedented support for national advanced strategic industries, including semiconductors. The government plans to begin selecting strategic technologies in the first quarter and will provide package support in investment, research and development (R&D), and manpower.

The Ministry of Trade, Industry and Energy announced on the 25th that the draft enactment and promulgation of the "Special Act on Strengthening Competitiveness and Fostering National Advanced Strategic Industries (National Advanced Strategic Industries Special Act)" was approved at the 5th Cabinet meeting. This promulgation aims to designate national advanced strategic technologies and foster and protect national advanced strategic industries to secure national and economic security and competitiveness in advanced industries.

According to the National Advanced Strategic Industries Special Act, the government will first establish the National Advanced Strategic Industries Committee under the Prime Minister and formulate a basic plan for fostering and protecting strategic industries every five years. The committee will be composed of about 20 government and private members, chaired by the Prime Minister, with the Minister of Trade, Industry and Energy serving as the secretary. It will be responsible for reviewing and deciding on the designation of strategic technologies and major support policies for strategic industries. The Minister of Trade, Industry and Energy will establish a basic plan for fostering and protecting strategic industries every five years, and heads of related central administrative agencies will establish and implement annual execution plans based on the basic plan.

The Minister of Trade, Industry and Energy is scheduled to begin the selection of strategic technologies in the first quarter. Industrial technologies that meet the designation criteria will be designated through review by the Technology Adjustment Committee and deliberation and resolution by the National Advanced Strategic Industries Committee to foster strategic industries and secure national and economic security. In particular, designation will consider factors such as ▲impact on industrial supply chains and national and economic security ▲growth potential and technological difficulty ▲spillover effects on other industries ▲industrial importance ▲and impact on the national economy including exports and employment.

Investment, R&D, and manpower support for strategic industries will also be promoted. Specifically, package support will include ▲special expedited processing of permits and approvals ▲infrastructure establishment ▲civil complaint handling ▲fund formation ▲and tax credits. Especially, if designated as a strategic technology, tax credit rates will support R&D up to 40-50% and facility investment up to 12-20%. Additionally, for strategic technology R&D, priority will be given in government budget allocation, and special exceptions will be made for preliminary feasibility studies when promoting large-scale projects.

Support will also be provided to secure professional manpower through contract departments, establishment and operation of specialized universities (graduate schools), and enhancement of practical skills through the establishment of a "Strategic Industry Comprehensive Education Center." Visa exceptions will also be supported to attract excellent overseas R&D personnel. The Ministry of Trade, Industry and Energy will specify these support details and procedures through subordinate legislation and will collect and reflect industry opinions through legislative notice in March and April.

Furthermore, if companies engaged in strategic industries apply for regulatory improvements, the heads of related administrative agencies must respond with review results within 15 days, and if legal revisions are necessary, regulatory improvements will be promoted through committee deliberation. For the strategic industry solidarity cooperation model, the plan includes treating it as if approved by the Fair Trade Commission regarding the prohibition of unfair joint acts under the Fair Trade Act special provisions.

Moreover, if designated as a strategic technology, it will be regarded as designated national core technology under the "Industrial Technology Protection Act," and regardless of government R&D support, approval from the Minister of Trade, Industry and Energy will be required for technology exports and corporate mergers and acquisitions.

Minister of Trade, Industry and Energy Moon Seungwook stated, "In a situation where major countries around the world are competing to strengthen their advanced industrial competitiveness, fostering and protecting national advanced strategic industries is important to secure our industrial leadership." He added, "With the enforcement of the law in the second half of the year, we will promptly support the strengthening of capabilities in key advanced industries such as semiconductors and secondary batteries, carry out follow-up measures without delay, and enhance communication with the industry."