The Ministry of SMEs and Startups announced on the 15th that it held the second meeting of the ‘Task Force for Resolving the Problem of Unfair Intervention by Third Parties’ chaired by First Vice Minister Noh Yong-seok and attended by the Ministry of SMEs and Startups and four policy finance institutions.
This meeting brought together relevant ministries and agencies, including the Financial Services Commission, the National Police Agency, and the Financial Supervisory Service, along with the Korea SMEs and Startups Agency, the Korea Startup & Entrepreneurship Development Institute, and the Korea Credit Guarantee Fund, for the first time. The task force was formed to develop a swift and systematic government-level response to illicit third-party intervention in policy financing.
The second TF meeting discussed legislative directions, including the introduction of a registration system for policy fund consulting. Detailed implementation plans for response measures were also discussed, including a plan to investigate the status of unfair third-party intervention, a whistleblower reward system, and the introduction of a whistleblower immunity system. The Ministry of SMEs and Startups is reviewing relevant legal revisions to strengthen the management of consultants who handle policy loan and guarantee applications, and plans to prepare amendments, including those to the "Act on Promotion of Small and Medium Enterprises," within the first half of this year.
Additionally, to understand the reality of unfair third-party intervention, the Ministry of SMEs and Startups will conduct an anonymous online survey starting January 21st targeting new and existing users of policy funds from four policy finance institutions. The survey will identify experiences of unfair intervention, the type of intervention, the reasons for use, and any damages incurred.
Each policy-based financial institution will operate a reporting reward system through its Illegal Broker Reporting Center. Reporters who provide information on unfair third-party intervention in policy-based loans and guarantees will receive a reward of up to 2 million won per case. Furthermore, to encourage proactive reporting, a whistleblower immunity system will be introduced in January, exempting companies implicated in unfair intervention from penalties as long as their involvement is not illegal or malicious.
The relevant ministries attending the meeting agreed to strengthen cooperation between relevant agencies to share information and expedite investigations and investigations. The Korea Institute for Advancement of Technology and Information Technology (KIAT) also announced plans to form a separate task force to address undue third-party interference in R&D support projects and to conduct a fact-finding survey and implement a system.
First Vice Minister of SMEs and Startups Noh Yong-seok said, “We will establish an institutional management system, including reviewing a registration system for policy fund consulting, and encourage reporting of unfair third-party intervention through a reward system and immunity system,” adding, “We will take strict measures, such as requesting investigations, for any illegal activities that are reported.”
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