According to Yonhap News,

(SEJONG = Yonhap News) The Korean government is to simplify the procedures for adding extra land to existing industrial complexes. The move is expected to reduce companies’ burdens arising from the expansion and development of factories.

The Ministry of Land, Infrastructure and Transport (MOLIT) announced on April 7 that it will revise the “integrated guidelines for the development of industrial site” to clarify criteria to allow existing industrial complexes to change development plans for the expansion of sites for factories.

Until now, authorizers, mostly governors of local governments, were reluctant to approve a change in development plans. The authorizers were concerned that the approval would be seen as granting privilege to the complexes, as there were no relevant criteria regulating such circumstances.

In particular, the current guidelines lack the criteria that regulate the change of use of green areas and land for public facilities within a complex.

To resolve this, MOLIT revised the guidelines and set up criteria for a change of development plans as follows: ▲ expansion of sites for factories ▲ improvements for deteriorated infrastructure ▲ change of target industries due to a change in industrial demand ▲ expansion of convenient facilities for employees.

“The revision will allow industrial complexes such as the Yeosu National Industrial Complex to expand their sites for factories very easily. Old industrial complexes, such as the Sihwa-Banwol Industry Complexes, will also find it easier to expand infrastructure such as roads, parks and welfare facilities within the complexes under the new criteria,” said a MOLIT official.

The revised guidelines also require developers to establish public facilities such as roads, parks and green areas when carrying out development projects for the expansion of sites for factories in industrial complexes, by using development profits that are less than 50 percent of the land price difference.

The purpose of setting a limit on the money used to establish public facilities is to lessen the excessive financial burden on companies.

In addition, MOLIT revised the betterment redemption system (Industrial Cluster Development and Factory Establishment Act) that allows authorized administrators of industrial complexes to redeem 50 percent of the land price difference arising from the change in land use.

This is because the coexistence of the betterment redemption system and new criteria that require developers to establish public facilities may impose a double burden on companies.

“We expect the revised guidelines, along with the Enforcement Decree of the Industrial Cluster Development and Factory Establishment Act that is also expected to be revised, will remove the double burden on companies and stimulate investment,” said a MOLIT official.