91% of Domestic Companies Oppose the Enactment of the Serious Accidents Punishment Act... Business Community Urges Legislative Suspension

[Asia Economy Reporter Su-yeon Woo] While the ruling party is pushing for the enactment of the Serious Accident Corporate Punishment Act, more than 30 economic organizations have called for a halt to the legislation. With 9 out of 10 domestic companies opposing the Serious Accident Corporate Punishment Act currently being promoted by the National Assembly, the ruling party, which unilaterally processed the 'three corporate regulation laws' including the Commercial Act, the Fair Trade Act, and the Financial Group Supervision Act, is now pushing through the Serious Accident Corporate Punishment Act as well. This move is intended to directly inform the public about the problems of the bill.

On the 16th at 11 a.m., 30 economic organizations and industry associations, including the Korea Employers Federation, the Korea Chamber of Commerce and Industry, and the Federation of Korean Industries, held a joint press conference at the Korea Press Center in Jung-gu, Seoul, to oppose the enactment of the Serious Accident Act. The business community urged the suspension of the legislation, stating that if businesspeople cannot shake off the fear of when and how they might be severely punished, overall business activities will inevitably be restrained. They argued that the scope of corporate executives' obligations in the bill is vague, and that it imposes additional regulations that tighten the grip on companies by including minimum imprisonment terms of 2 to 5 years and punitive damages of 3 to 5 times the amount. ▶Related article page 2

Kim Yong-geun, Vice Chairman of the Korea Employers Federation, along with key representatives from major economic organizations, held a joint press conference on the "Legislation of the Serious Accidents Punishment Act" on the 16th at the Press Center in Jung-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

Fear among companies regarding the Serious Accident Corporate Punishment Act has reached its peak. According to the 'Serious Accident Corporate Punishment Act Corporate Awareness Survey' released by the Korea Employers Federation on the same day, 90.9% of the 654 participating companies responded that they 'oppose' the enactment of the bill. Furthermore, 95.2% overwhelmingly felt that the level of punishment imposed on business owners, management officials, and corporations contained in the bill is excessive. When asked about the effectiveness of strengthened punishments in preventing serious accidents, 84.3% of the responding companies answered that there is 'no or minimal preventive effect.'

Additionally, companies predicted that if punishments are strengthened, small and medium-sized enterprises (89.4%) rather than large corporations (7.2%) will be the most affected business groups. Regarding related impacts, the majority of companies (63.6%) expressed concern about 'increased business management risks due to the rise in actual imprisonment of business owners and management officials,' followed by worries about 'contraction of production activities due to excessive fines and administrative sanctions (60.9%).' As for practical improvement measures for preventing serious accidents, 48.8% of the responding companies selected the reform of safety systems considering the characteristics of industries and company sizes, as well as the improvement of unreasonable overlapping regulations.

Kim Yong-geun, Vice Chairman of the Korea Employers Federation, emphasized, "It is an urgent national task to shift the focus of South Korea's industrial safety policy from the current 'post-penalty' approach to a 'prevention-centered policy.' A bill that blindly strengthens only the level of punishment will rather cause companies to hesitate in making bold investments and efforts in industrial safety."

This content was produced with the assistance of AI translation services.