'Payment Linkage' Outstanding Companies... Ministry of SMEs and Startups - Fair Trade Commission Announce Best Practices

Kia, N2V, Daehan Electric Wire, and a total of 16 companies

The Ministry of SMEs and Startups announced on the 18th that it awarded outstanding companies and contributors who have contributed to the expansion of linked payment systems at the Korea Federation of SMEs in Yeouido, Seoul, together with the Fair Trade Commission.

On the morning of October 25th, Lee Young, Minister of SMEs and Startups, and Han Ki-jung, Chairman of the Fair Trade Commission, attended the joint meeting of the Ministry of SMEs and Startups and the Fair Trade Commission on the implementation of the linked payment system for delivery payments, held at the Foundation for Cooperation between Large, Small and Medium Enterprises and Agriculture and Fisheries in Jung-gu, Seoul. Photo by Heo Younghan younghan@

A total of 16 companies were recognized as excellent linked companies. Six companies including Kia, N2B, Daehan Electric Wire, Pyeonghwa Industry, Sinsung Delta Tech, and E-Land World received the Fair Trade Commission Chairman’s Commendation for outstanding payment adjustment performance, while ten companies including LG Household & Health Care, LG Electronics, Hyundai Wia, Haesung DS, Hanmi Pharmaceutical, Bon I.F., Eugene Technology, Sejin Valve Industry, Korea Midland Power, and Korea Railroad Corporation received the Ministry of SMEs and Startups Minister’s Commendation for outstanding participation in the companion company program.

Executive Director Cho Hoon of KT, Manager Woo Jong-tae of LG Electronics, and Manager Park Eun-hee of POSCO were awarded the Ministry of SMEs and Startups Minister’s Commendation for their contributions as members of the on-site implementation task force (TF), managing internal systems for the efficient operation of the linked payment system, and other activities.

At this event, four companies selected as model cases?Pyeonghwa Industry, Sinsung Delta Tech, Haesung DS, and Korea Midland Power?presented examples such as adjusting payments according to raw material price fluctuations before the enforcement of the linked payment-related law on October 4, establishing internal IT systems for monitoring raw material trends, and actively utilizing not only the linked payment system but also the payment adjustment consultation system.

So far, the Ministry of SMEs and Startups and the Fair Trade Commission have jointly listened to industry opinions through meetings, on-site inspections, and roadshows. Since the opening ceremony of the roadshow in February, a total of 157 roadshows have been held nationwide, informing 12,370 participants about the linked payment system. To encourage participation in the companion company program, the incentive for a one-year exemption from entrusted-subcontracted transaction and subcontracted transaction surveys was expanded last month.

Additional incentives were also prepared for the selected outstanding companies, including a two-year exemption from mandatory investigations of entrusted-subcontracted transactions and up to a two-year exemption from mandatory investigations of subcontracted transactions.

As of the 12th, the number of companion companies was counted at 10,154. This surpassed the initial goal of recruiting 6,000 companion companies in September and reached the new target of 10,000 companies.

The companion companies include 417 entrusting companies (original contractors) and 9,737 entrusted companies (subcontractors). The entrusting companies are composed of 24.7% large enterprises, 23.7% mid-sized companies, 30.2% small and medium enterprises, and 21.3% public institutions. By industry, 66.9% are manufacturing, 19.9% services, 6.5% construction, 4.6% information and communication, and 2.2% wholesale and retail.

Minister Lee Young of the Ministry of SMEs and Startups emphasized, “For sustainable growth and development of our economy, it is important for large enterprises and SMEs to grow together, and the linked payment system will play a significant role. The Ministry will regularly communicate with the field to identify policy demands for the system’s on-site settlement and expand tailored support accordingly, while strengthening field supervision such as entrusted-subcontracted transaction surveys and mandatory investigations to prevent illegal activities.”

Fair Trade Commission Chairman Han Ki-jung said, “Despite difficult economic conditions, the linked payment outstanding companies and model cases that have strived to share costs with partner companies will have a positive influence on our society and serve as role models for other companies. The Fair Trade Commission will revise the standard subcontract agreements for major industries such as automobiles and mold manufacturing within the year to include linked payment provisions and reflect linked payment performance when selecting exemplary win-win companies in the subcontracting sector.”

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