Fair Trade Commission Fines Doosan 230 Million Won for SI Outsourcing Abuse... Cracks Down on Chronic 'Work First, Contract Later' Practice

516 SI Contracts Not Issued to 182 Subcontractors

Some Documents Delivered 291 Days After Work Began

The Fair Trade Commission has intervened to put a stop to the chronic practice among large corporations of commissioning system development and management (SI) services without even issuing written contracts—a so-called "work first, contract later" custom.

On May 10, the Fair Trade Commission announced that it had decided to impose a corrective order and a fine of 230 million won on Doosan for failing to issue or for delaying the issuance of written contracts when outsourcing SI services to 182 subcontractors.

According to the Fair Trade Commission, from January 2022 to October 2024, Doosan outsourced 516 cases of SI services but did not provide written documents containing legally required information, such as subcontract payment amounts, before the commencement of the work. In one case, the contract document was provided only after a delay of 291 days following the start of the service. This constitutes a violation of the Subcontracting Act, which is designed to prevent disadvantages to subcontractors arising from unclear contract terms.

Additionally, Doosan was also found to have issued "incomplete documentation" with unclear payment or inspection dates and failed to preserve essential documents, such as task orders, for three years as required. As a result, the company received a warning.

The domestic SI market has grown to a size of 56 trillion won as of 2025, but unfair practices have persisted within its closed structure, with more than 60% of transactions occurring through internal dealings among SI affiliates of large conglomerates. The Fair Trade Commission expects that this measure will raise awareness across the SI industry and serve as an opportunity to establish fair trading practices.

The Fair Trade Commission stated, "We will continue to correct practices that infringe on the rights and interests of subcontractors in advanced industries and will take strict action in accordance with laws and principles when illegal acts are identified."

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