Cooperatives Also Included in the Scope of Disabled Enterprises

Enforcement Decree to Be Promulgated in Mid-June... Support Policies for Disabled Enterprises Including Public Procurement Available

[Asia Economy Reporter Kim Cheol-hyun] A path has been opened for cooperatives to be recognized as disabled-owned enterprises. This will enable them to utilize support policies for disabled-owned enterprises, such as public procurement. The Ministry of SMEs and Startups (Minister Park Young-sun, hereinafter referred to as the Ministry) announced that the "Enforcement Decree of the Act on the Promotion of Disabled-Owned Enterprises," which includes key provisions such as expanding the scope of recognition for disabled-owned enterprises, extending the validity period of disabled-owned enterprise certification, and establishing grounds for handling unique identification numbers, passed the Cabinet meeting on the 9th. This amendment to the enforcement decree aims to revitalize disabled-owned enterprises in the form of cooperatives and to reduce the burden on companies related to the disabled-owned enterprise certification system.

First, cooperatives substantially owned and managed by disabled persons will be able to receive certification as disabled-owned enterprises. This is to eliminate discrimination between cooperatives and other business forms as part of "social economy revitalization" and to support various forms of disabled-owned enterprise activities. To be recognized as a disabled-owned enterprise, a cooperative must meet all three conditions: it must be a general cooperative under the Framework Act on Cooperatives, more than half of the total members must be disabled persons, more than half of the total contributed shares must be contributed by disabled members, and the chairman of the board must be a disabled member. Once recognized as a disabled-owned enterprise, cooperatives will be able to receive various policy supports such as priority purchase by public institutions and preferential participation in government-supported projects.

Additionally, the validity period of disabled-owned enterprise certification has been extended from 2 years to 3 years to reduce the burden on companies for certification and renewal. Until now, companies had to submit documents every two years proving that the representative was a disabled person under the Commercial Act or a sole proprietor, documents proving a disabled employment rate of 30% or more, and evidence that the disabled representative was substantially managing the business. With the extension of the validity period through this amendment, it is expected that the document submission burden for about 5,000 disabled-owned enterprises requiring certification renewal will be alleviated from mid-June, when the enforcement decree is promulgated.

To facilitate administrative tasks such as certification of disabled-owned enterprises, a regulatory basis has also been established to handle unique identification numbers required for certification and renewal. Kwon Dae-su, Director of Small Business Policy at the Ministry, stated, "With this amendment to the enforcement decree, the activity scope of disabled-owned enterprises will expand, while the administrative burdens hindering their activities will be reduced, leading to the revitalization of various forms of disabled-owned enterprises." He added, "We will continue to expand practical and effective policy support that can be felt on the ground to ensure that the diverse activities of disabled-owned enterprises are guaranteed."

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