Lee Young, Ministerial Candidate for the Ministry of SMEs and Startups, "Promoting Legislation of the Delivery Price Linkage System" (Comprehensive)

Lee Young, nominee for Minister of SMEs and Startups, is attending the confirmation hearing held at the National Assembly on the 11th and responding to questions from lawmakers. Photo by Yoon Dong-joo doso7@

[Asia Economy Reporter Donghyun Choi] Lee Young, nominee for Minister of SMEs and Startups, announced on the 11th that he will push for the legislation of the long-awaited 'Delivery Price Linkage System' for small and medium-sized enterprises (SMEs).

At the confirmation hearing held by the National Assembly's Industry, Trade, Energy, and SMEs Committee on the same day, Lee stated, "If appointed as minister, I will promote a measure to include a clause in contracts that mandates at least the linkage of delivery prices."

Yang Geum-hee, a member of the People Power Party, drew out Lee's opinion on the realization of delivery prices, saying, "The difficulties faced by SMEs due to the sharp rise in raw material prices are indescribable." Kim Kyung-man of the Democratic Party also raised the need for the introduction of the linkage system, stating, "The polarization between large and small-medium enterprises is intensifying."

Regarding this, Lee said, "When the Fair Trade Commission and the transition committee reviewed the implementation of the linkage system, they agreed on its necessity, but since excessive government intervention could cause problems, the direction was to leave it to autonomy. However, my personal view is that autonomy alone cannot solve the problem in the market." He added, "I will actively promote legislation that can resolve the issue of soaring raw material prices."

Lee also emphasized, "The delivery price adjustment council is not functioning well on the SME front," and added, "I have witnessed many situations where SMEs, as partner companies, had to bear the risk burden when unpredictable situations like raw material price hikes occurred."

"230 Million KRW Worth of Stocks to be Sold or Placed in Blind Trust"

During the hearing, the issue of disposing of unlisted stocks held by Lee was also raised. The stocks Lee holds include 42,000 shares of Y Alliance Investment, a venture capital firm he founded and operated, and 177,200 shares of Terten, an IT security company, totaling approximately 230 million KRW.

Shin Jeong-hoon of the Democratic Party pointed out, "According to the Public Officials Ethics Act, if stock holdings conflict with a lawmaker's duties, disposal is mandatory. However, Lee changed the relevant standing committee without disposing of the stocks."

Lee explained, "Since I was selected as a proportional representative, the time to wind up the company was very tight," and added, "I will dispose of the stocks within two months by sale or placing them in a blind trust, in accordance with the Public Officials Ethics Act and related regulations."

Actively Explaining 'Conflict of Interest' Controversy... Tearfully Stated, "I Did Not Use My Company to Enter Politics"

The operation and investment methods of Terten and Y Alliance Investment, founded by Lee, and the conflict of interest issues were also brought up. Criticism was raised over Y Alliance Investment, a venture capital (VC), investing in sound companies contrary to its original purpose of fostering youth startups, and transferring its shares to Sanha Industry, where Park Sung-taek, former chairman of the Korea Federation of SMEs, is the largest shareholder.

Lee Dong-joo of the Democratic Party criticized, "There is suspicion that the VC was used as a personal safe for former chairman Park of the Korea Federation of SMEs," and added, "It appears there are special economic interests with a specific entrepreneur, raising concerns about whether fair work can be done for venture investments."

Lee responded, "If you visit my Facebook, you can see photos and records of pitching with startups from 2017 to 2020," and said, "Thirty entrepreneurs gathered to form a team for angel funds and mentoring." He added, "I have never heard that becoming a lawmaker comes from creating a VC."

Another major issue was that Lee, while serving as CEO of Terten, acted as a government advisory member and supplied his company's products to public institutions. Lee stated, "The solution was registered through the proper procedures of the Public Procurement Service," and added, "Sales to public institutions account for less than 10% of the company's total sales."

During the hearing, Lee tearfully said, "I did not build my credentials or use my company to enter politics."

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