Baram International, which operates the vegan beauty brand 'Dear Dahlia', has escaped a fine of 100 million won imposed by the Ministry of Small and Medium Enterprises and Startups. The ministry had determined that Baram International improperly used subsidies, but withdrew the fine based on the court's ruling that it did not sufficiently examine the facts.
According to a report by ChosunBiz on the 1st, Baram International participated in the 'Export Voucher Business Utilizing Export Support Infrastructure' and the 'Online Export Star Enterprises Establishment and Fostering Project' by the ministry in 2019, receiving subsidies and vouchers.
These projects aimed to support small and medium-sized enterprises in conducting overseas marketing suitable for their scale and capabilities and ensuring that their shopping malls obtained international competitiveness.
Baram International spent a minimum of 85 million won on marketing expenses and submitted evidence documents to Company A, the subsidized partner with which it was conducting the project alongside the ministry. During this process, the responsible employee mistakenly submitted some evidence of the marketing expenses to another project.
Company A judged it as 'improper receipt' due to receiving subsidies redundantly for the same expenditure across two projects, resulting in a one-year restriction on business participation and a recovery order for the subsidy (approximately 25.8 million won).
Baram International objected to the Ministry of Small and Medium Enterprises and Startups, noting that 'the employee mistakenly submitted the evidence documents.' However, the ministry did not accept the objection and notified that it would impose a fine of approximately 124.98 million won and limit the payment of subsidies until February 2027. Baram International filed an administrative lawsuit against the ministry's disposition in April last year.
The court concluded earlier this year that the ministry's fine was unjust. It stated that the ministry had to investigate and verify whether the imposition of the fine was appropriate according to regulations and whether the partner's disposition was appropriate but deemed that the ministry did not properly adhere to this process.
The court described, 'The ministry held a review by the 'Improper Receipt Review Committee' before imposing the fine, but it seems that it did not adequately consider whether the disposition of Company A was appropriate or whether the payment details were redundantly submitted due to the negligence of a Baram International employee.'
The ministry agreed with the court's decision and did not appeal. Consequently, Baram International will not be subject to the fine and the subsidy payment restriction.
Established in 2014, Baram International garnered attention by launching the vegan beauty brand Dear Dahlia in 2017. Within two years of launching the brand, it expanded into France, the United States, Italy, and Germany. The ministry selected Baram International as a 'pre-unicorn corporation' in 2020.