Two Amendments Proposed to Fulfill President Lee Jaemyung's Campaign Pledges
Kim Won Introduces Bills to Protect Small Business Owners and Ensure Fair Subcontracting Practices
Won Kim, member of the Democratic Party of Korea.
Kim Won, a member of the Democratic Party of Korea (representing Mokpo, South Jeolla Province), announced on June 17 that he has introduced two bills as the lead sponsor: the Small Business Protection Act and the Amendment to the Fair Transactions in Subcontracting Act, both aimed at fulfilling President Lee Jaemyung's campaign pledges.
The proposed amendment to the Act on the Protection and Support of Small Businesses is intended to protect small business owners from violent crimes and other threats. It explicitly allows the Minister of SMEs and Startups and local government heads to implement necessary measures, such as providing safety equipment to female sole proprietors.
As of April, there were 1,734,000 female self-employed workers in Korea, with 1,327,000, or 76.5%, working alone without employees. Due to concerns over safety, especially for those operating late at night in specific locations, the amendment establishes a legal basis for supporting female sole proprietors by providing them with a safety call system directly connected to the National Police Agency.
The proposed amendment to the Fair Transactions in Subcontracting Act is intended to prevent large corporations and others from circumventing the supply price indexation system through loopholes. Since 2023, this system has allowed for the adjustment of supply prices in response to fluctuations in raw material costs.
However, under the current law, the supply price indexation system does not have to be applied in cases where: ▲ the principal contractor is a small business; ▲ the subcontracting period is within 90 days; ▲ the subcontract amount is 100 million won or less; or ▲ the principal and subcontractor have agreed not to apply the indexation system.
In practice, this has led to abuses such as so-called "split contracts," where contract periods or amounts are divided, and situations where principal contractors effectively force subcontractors to agree not to use the indexation system.
The amendment specifically prohibits: ▲ dividing contract periods or amounts without justifiable reasons when assigning work; ▲ demanding or inducing agreements not to apply the supply price indexation system; and ▲ retaliatory actions against subcontractors who request indexation.
Kim emphasized, "By passing these two amendments that realize President Lee Jaemyung's pledges, I will do my utmost to create a safer country for small business owners and foster a nation where small and large companies cooperate for mutual benefit."
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