Ministry of SMEs and Startups Conducts On-site Investigation of Payment for Supplies... "Minimizing the Burden of Raw Material Price Increases"

'Regular Survey on Consignment and Subcontract Transactions' Conducted
Focus on Unfair Trade and Non-payment of Supply Prices

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[Asia Economy Reporter Kim Bo-kyung] The Ministry of SMEs and Startups announced on the 1st that it will conduct on-site inspections targeting companies suspected of violating the Win-Win Cooperation Act.

The Ministry conducts regular surveys on consignment transactions every year to correct unfair trade practices and promote sound trading customs.

In the survey that began in December last year, a written investigation was conducted on 15,000 consigner and consignee companies regarding payment for delivered goods, issuance of agreements, unfair reductions in delivery payments, and the use of Win-Win Payment systems.

In particular, considering the situation where the difficulties of consignee companies are increasing due to fluctuations in supply costs such as rising raw material prices, the survey focused on the actual conditions related to unfair special clauses on delivery payment adjustments and the delivery payment adjustment consultation system.

To verify suspected violations of the Win-Win Cooperation Act found during the written survey, on-site inspections will be conducted on the relevant companies from the 2nd until the 10th of next month (with extensions if necessary).

The on-site inspections will focus on unfair practices related to delivery payment adjustments and whether payments such as delivery payments have been withheld. If violations of the law are confirmed, voluntary correction will be encouraged, but companies that do not comply will face strict sanctions such as improvement orders and public disclosure.

Jung Ki-hwan, Director of the Win-Win Cooperation Policy Division at the Ministry of SMEs and Startups, stated, "Through this investigation, we will improve and prevent unfair trade practices that may occur in consignment transactions," adding, "We will focus on correcting unfair practices related to delivery payment adjustments to minimize the burden on consignee companies caused by rising raw material prices."

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