[Yoon Administration Economy] Pilot Operation of 'Delivery Price Linkage System' Within the Year... Strengthening Punishment for Technology Theft

Preparation of Measures to Introduce Delivery Price Linkage System... Improvement of Adjustment Consultation System
Strengthening Punitive Damages for Technology Theft... Platforms Regulated by Self-Regulation
Promotion of SME Development Measures... Reform of Policy Finance Focused on Innovation and Growth
Introduction of Multiple Voting Rights... Launch of 'Global Unicorn Project'

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho is speaking at the emergency macroeconomic financial meeting held at the Bankers' Hall in Jung-gu, Seoul on the 16th. Photo by Moon Honam munonam@

[Asia Economy Sejong=Reporter Lee Junhyung] As part of its policy to foster small and medium-sized enterprises (SMEs), the government will pilot the ‘Delivery Price Linkage System’ in the second half of this year. Punishments for unfair practices such as technology theft by large corporations will also be strengthened. The government plans to establish a private self-regulatory organization to reduce ‘platform gapjil’ (abuse of power by platforms).

The government announced these details in the ‘New Government Economic Policy Direction’ on the 16th.

First, the government will pilot the Delivery Price Linkage System within the second half of this year. This is to ensure that subcontractors and other SMEs receive fair prices from primary contractors. The government also plans to prepare a standard contract for delivery price linkage within the year. In addition to the Delivery Price Linkage System, the government intends to foster a voluntary win-win culture between large and small businesses through improvements in adjustment consultation systems and the provision of incentives.

The level of punishment for unfair practices such as technology theft will also be increased. The government’s stance is to ease regulatory burdens on companies while strictly punishing unfair practices to establish a fair market economy order. Accordingly, punitive damages for technology theft will be strengthened. After analyzing prosecution and court ruling cases, the government plans to improve guidelines related to reporting violations of the Fair Trade Act and operate a strict and objective exclusive prosecution system. The government also plans to strengthen monitoring of unfair practices such as abuse of intellectual property rights that block new market entry and unfair internal transactions.

The platform market will be regulated through private-led self-regulation. The government will form a private self-regulatory organization to prepare self-regulation measures that enable platforms, small business owners, and consumers to coexist. Through the self-regulatory organization, measures such as establishing voluntary dispute resolution bodies, preparing self-regulatory codes, and signing win-win agreements are expected to be proposed.

The Ministry of Economy and Finance, Ministry of Science and ICT, Fair Trade Commission, and other related ministries will establish a pan-government platform consultative body to support the private self-regulatory organization. They also plan to prepare review guidelines specialized for unfair practices by platform companies and continuously monitor the related market.

Measures to foster SMEs will also be promoted. The government will prepare a ‘Reform Plan for SME Support Project Evaluation System’ within the second half of this year to evaluate each ministry’s financial support projects and policy finance for SMEs from the perspectives of innovation and growth. To focus policy finance on innovation and growth, the joint standards for policy finance will be revised by December. Research and development (R&D) financial support will be restructured to focus on supporting scale-up of high-growth companies.

Support by corporate growth stages will be strengthened to foster the venture ecosystem. Specifically, the government will expand ‘Startup-Centered Universities’ that support from startup preparation to commercialization and support the activation of Corporate Venture Capital (CVC). The tax-exempt limit on gains from exercising stock options will be increased from the existing 50 million KRW to 200 million KRW. The government plans to systematically support promising venture companies’ overseas expansion by launching the ‘Global Unicorn Project’ linked with overseas venture capital (VC).

The multiple voting rights system, requested by the venture industry, will also be introduced. Multiple voting rights is a system that grants founders or CEOs more voting rights than common shares based on their shareholdings. It is a management control defense tool that supports venture and startup founders to make bold decisions without being swayed by external capital even with large-scale investments. To strengthen the venture investment ecosystem, the government will diversify funding methods such as Silicon Valley-style hybrid finance and improve regulations related to mergers and acquisitions (M&A) and initial public offerings (IPO) to revitalize the exit market.