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National Assembly Legislation

  • Act on the Promotion of Mutually Beneficial Cooperation between Large Enterprises and Small and Medium Enterprises
    • Competent Ministry : Ministry of SMEs and Startups
    • Advance Publication of Legislation : 2020-07-08
    • Opinion Submission Deadline : 2020-07-22
Reasons for Proposal

The current Act prohibits commissioning enterprises from demanding technical data from commissioned enterprises without just cause, and prescribes that in the case of technical data being demanded for just cause, the commissioning enterprise shall confer with the commissioned enterprise beforehand regarding their purpose, confidentiality matters, etc., and provide such contents in writing to the commissioned enterprise.

Despite such provisions, certain large enterprises with superior bargaining power demand confidential technical data from small and medium enterprises with less bargaining power on grounds of quality assurance or submission to state institutions, etc., by making demands through various channels such as in person, over the phone, through e-mail, etc., and do not even enter into non-disclosure agreements. As a result, small and medium enterprises experience difficulties in proving technology theft.

Therefore, this proposal aims to prescribe that when a commissioning enterprise with superior bargaining power demands technical data from a commissioned enterprise with less bargaining power, such commissioning enterprise shall enter into a non-disclosure agreement in writing with the commissioned enterprise which can act as evidence, and provide a basis for requesting the imposition of  black marks or placement of restrictions on the qualifications for participation in a bid in the case of a violation (Articles 25 (2) and 27 (1) and (5)).


Major Provisions

Matters to be Observed (Article 25)


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