The Present Status and Problems of SME Legal System and its Way of Improving in Korea

Abstract

SMEs as a “vital majority” play a central role in the growth engine of the national economy that leads innovation, generates jobs and facilitates competitions. In case SMEs continue to grow soundly with challenge and flexibility, it is possible to keep national economy and society vital and enhance sustainable developments. Most of developed countries have been developing various policies to protect and foster SMEs for social stability as well as free market economy. They have made commitments to amend laws for supporting small and medium-sized enterprises. SMEs have been traditionally regarded as the “social weak” compared to large enterprises and thought to be protected by the social policies. Especially Korean government has established and revised a number of SME-related laws for protecting and fostering small and medium-sized enterprises for nearly half a century. Nevertheless, the current SME laws are systematically complicated and there may seem to be a lot of problems such as separation in contents between policies and laws, contradictions and duplications among laws, unnecessary regulations and so on. It is also true that government has made lots of efforts and attempts to improve SME laws and legal systems. However, these measures have not reflected the perpectives of SMEs but done government's views. And government has only focused on introducing laws for small and medium-sized enterprises, whenever necessary, without fully making consideration for overall legal systems. Various individual levels of SME laws should be complemented and developed according to newly changing policy environments. At the same time, it is a major challenge to improve systems and contents of SME laws from diverse points of view such as connection between Framework Act on Small and medium Enterprises(SMEs) and individual measures, policy relevance, effectiveness of a legal system, SME's accessibility, objective of laws and policies, and the reasonability of regulation in an overall law system. The present study tries to systemize SME laws as a whole, analyse current legal problems and suggest ways of improvement from a different point of view. This study is meaningful to make SME's legal systems advanced.