Korean Government to Assist in Business Overhaul of 10 Companies

The Ministry of Trade, Industry and Energy has finalized its latest plan to assist in 10 selected companies’ business reorganization.

Such plans of the ministry started in 2016 and a total of 128 companies have benefited from the plans. The purpose of the plans is for the government to provide assistance for those planning on new business or efficiency enhancement based on business reshaping. Incentives of the plans include a 50 percent cut in registration license tax for merger or capital increase as well as financial and business location incentives.

In the latest plan, six auto parts manufacturers are planning to shift their business to the electric and hydrogen vehicle industries from internal combustion engine vehicle. The other four companies are going to change their business structures in aircraft, foldable smartphone, smart home and medical equipment.

The latest plan is characterized by being based on batch approval. The ministry adopted the method for the first time in that multiple companies simultaneously pursuing reorganization in the same field of business can maximize the effect of industrial structural innovation. The ministry explained that the six auto parts manufacturers’ reshaping was approved based on the new method.