'Local Commercial Area Act' to Revitalize Declining Business Districts to Take Effect from the 28th... "Expecting Economic Vitality"

Enforcement Decree of Local Commercial Area Act Passed at Cabinet Meeting on 26th
Establishing Criteria for Local Coexistence and Autonomous Commercial Zone Designation
Private Sector Efforts to Protect Commercial Areas...Government and Local Government Support

[Image source=Yonhap News]

[Asia Economy Reporter Kim Bo-kyung] The so-called 'Local Commercial District Act,' which supports the revitalization of declining commercial districts through public-private cooperation, will come into effect on the 28th.

The Ministry of SMEs and Startups announced that the Enforcement Decree of the Local Commercial District Act (Local Commercial District Act) passed the Cabinet meeting on the 26th.

The Local Commercial District Act is expected to serve as an institutional foundation to breathe new life into declining commercial districts and provide opportunities for revival to those struggling with rapidly rising rents.

The enforcement decree of the Local Commercial District Act, which passed the Cabinet meeting on this day, will be implemented together with the Local Commercial District Act enacted last year, starting from the 28th.

First, commercial districts are divided into 'Local Win-Win Zones,' where rents have surged sharply according to the characteristics of the commercial district, and 'Autonomous Commercial Zones,' where the economy has declined.

In each zone, private organizations such as local win-win councils and autonomous commercial associations will operate, allowing merchants and landlords to promote the protection of commercial districts, while the government and local governments provide support such as tax reductions, finances, and loans.

According to the enforcement decree passed on this day, to be designated as a Local Win-Win Zone, the rent increase criteria must exceed both ▲5% according to the Commercial Lease Protection Act and ▲the standards set by ordinances.

The Autonomous Commercial Zone is defined as a commercial district where two or more of the following?number of businesses, population, and sales?have decreased for two consecutive years regardless of the rate.

Additionally, to ensure transparency in the operation of the system, the enforcement decree requires a procedure for collecting opinions from merchants, landlords, and others when concluding a win-win agreement.

Asia Economy DB=Photo by Moon Honam munonam@

The decree also specifies detailed procedures for holding public hearings when designating zones and for establishing private organizations managing commercial districts in each zone (local win-win councils, autonomous commercial associations).

The target subject to business restrictions within the Local Win-Win Zone is limited to directly operated stores of franchise headquarters and chain headquarters exceeding the small and medium enterprise size criteria. The decree also specifies detailed procedures for consultation and review necessary for business restrictions and registration of restricted business types.

Other detailed matters include training commercial district specialists, establishing comprehensive plans for commercial district revitalization, and formulating basic plans by region.

The Ministry of SMEs and Startups plans to hold regional briefing sessions for local government officials and others to promote the spread of laws and commercial district policies. The briefings will be held sequentially starting from the end of next month, when the call for commercial district revitalization projects begins.

Jang Se-hoon, head of the Local Commercial District Division at the Ministry of SMEs and Startups, said, "The enforcement decree of the Local Commercial District Act contains specific provisions necessary for merchants, landlords, local governments, and other members of the commercial district to voluntarily come forward to protect and revitalize commercial districts. We hope to transform local commercial districts into vibrant places for life and work."

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