Since November 2022, multiple government ministries have been jointly promoting the establishment of world’s top-class clusters for domestic production of key high-tech strategic industries (e.g., semiconductor industry) to secure super-gap technologies and economic security. In this regard, the government plans to provide significant investment incentives. Further, to find best locations for specialized complexes, the Ministry of Trade, Industry and Energy (the “MOTIE”) published a public invitation on December 26, 2022, seeking applications from local governments, central administrative agencies, and companies.
Specialized Complex for National High-tech Strategic Industry
On August 4, 2022, the “Act on Special Measures for Strengthening and Protecting the Competitiveness of the National High-Tech Strategic Industry (the “Special Act”)” became effective in response to intensified competition on control over high-tech industries in the international community. With a specific purpose of supporting the national high-tech strategic industry, the Special Act addresses establishment of the National High-Tech Strategic Industry Committee and expedited approval/permitting process to increase investment in national high-tech industries.
“Specialized Complex for National High-tech Strategic Industry” refers to a designated area where educational, research, and industrial facilities related to strategic industries and strategic technologies form an innovative ecosystem to promote investment and technological development. In November 2022, the first National High-tech Strategic Industry Committee selected 15 sectors of national high-tech strategic technology as follows (the MOTIE appears to be working on and aiming to announce the specific details of the 15 fields considered as National High-Tech Strategic Technologies in March 2023.):
[Selected Sectors of National High-tech Strategic Technology (excerpt from the MOTIE’s press release dated November 4, 2022)]
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15 Sectors of National High-tech Strategic Technology |
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Semiconductor |
Memory |
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Non-memory |
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Packaging |
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Display |
OLED |
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Next-generation |
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Secondary Battery (3) |
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For those companies interested in specialized complex, the availability of the “fast track” system for obtaining relevant approval/permit is the most attractive merit. Moreover, as various local governments will offer competitive fostering plans and incentives to attract companies for specialized complexes, it appears that companies will be able to enjoy those benefits from local governments on the top of other supports available under applicable laws.
According to the MOTIE’s public invitation, the application period expires on February 27, 2023. To attract more applicants, the MOTIE held a briefing session on January 10, 2023 for local governments, institutions, and companies that are interested in specialized complexes. Once applicants submit a designation application form along with a fostering plan and evidentiary documents to support their qualifications for designation, an expert committee will conduct an initial review and evaluation. If any part of the fostering plan requires the government’s system improvement or support, further consultation with the relevant government will be carried out to proceed with the plan. After deliberation by the National High-Tech Strategic Industry Committee, a specialized complex for national high-tech strategic industry will be ultimately designated.
Eligible Companies and Benefits
All companies, including foreign corporations, are eligible for specialized complex as long as they engage in any of the 15 sectors specified above. According to the MOTIE’s public invitation, the MOTIE plans to provide the following supports to the companies that are participating in specialized complex (however, details of each support program may change based on consultation with relevant ministries):
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Expedited approval/permitting process for project operator of specialized complex, prompt processing of civil complaints by institutions occupying a specialized complex, and customized project feasibility studies.
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Installation of various amenities for the operation of specialized complexes, including sites, industrial infrastructure, joint R&D infrastructure, medical facilities, educational facilities, and housing.
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Promotion of technology development, improvement of productivity, and export for companies occupying a specialized complex.
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Support for training of human resources and prevention of industrial accidents & environmental contamination within a specialized complex.
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Reduction of, or exemption from, fees for the use of national or public property and/or rent paid by institutions occupying a specialized complex (limited SMEs and research institutions).
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Reduction of, or exemption from, charges for institutions occupying a specialized complex (limited to SMEs) and project operators.
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Other supports necessary to foster strategic industries, etc. under the Special Act.