The Ministry of SMEs and Startups moved to improve the system to lower the burden on participants in regulatory free zones and to revitalize regional specialized development zones.
The Ministry of SMEs and Startups (MSS) said a promulgation bill to partially amend the Special Act on Regulation for Regulatory Free Zones and Regional Specialized Development Zones (Regional Special Zones Act) was approved at a Cabinet meeting on the 23rd.
A regulatory free zone is a system that allows demonstration exemptions and temporary permits by not applying all or part of existing regulations to develop products and services using new technologies in a region.
There have been pointed out difficulties in carrying out demonstrations as regulatory ministries demanded additional conditions citing safety and other reasons. With this amendment, when a regulatory ministry demands additional conditions, it must clearly present the necessity and validity, which is expected to ease the burden on businesses participating in the zones.
Foreign-language medical advertisements will be exceptionally allowed within regional specialized development zones to bolster efforts to attract foreign medical tourists.
Supplementary measures to enhance the effectiveness of the regulatory free zone system were also included. Even after a zone designation period expires or is lifted, central administrative agencies and heads of local governments will be able to request data submissions or reports for performance management and post-exemption oversight.
A legal basis was also prepared to distribute establishment guidelines that include criteria for reviewing regulatory free zone plans. Going forward, if an application for designation as a regulatory free zone is rejected, the reasons must be notified. A new provision was established to prohibit the transfer or seizure of compensation received by victims when personal injury occurs due to an accident during a demonstration exemption or temporary permit project.
The amended Regional Special Zones Act is scheduled to take effect six months after the promulgation date.