The 'K-Culture Valley Complex Development Project' dissolution of agreement has led Gyeonggi Province and CJ ENM into a lawsuit worth over 500 billion won. Gyeonggi Province imposed a penalty for delay of over 300 billion won, holding CJ responsible for the project's delay, to which CJ strongly countered, stating it was Gyeonggi's fault.
According to related industries on the 10th, CJ ENM announced it filed a lawsuit worth 516 billion won at the Seoul Central District Court on the 8th regarding the dissolution of the basic agreement for the 'K-Culture Valley Complex Development Project' being conducted through its subsidiary CJ Live City, seeking confirmation of non-existence of debt of over 300 billion won and compensation for damages of over 180 billion won.
CJ ENM presented in the complaint the position that the K-Culture Valley project was delayed and the agreement was dissolved due to reasons such as 'delay in permits, insufficient water quality improvement for the Korean wave, and Gyeonggi Province's failure to fulfill its obligations, including inability to supply large amounts of electricity.'
Earlier, Gyeonggi Province imposed a total of 314.4 billion won on CJ Live City, consisting of a penalty for delay of 284.7 billion won, a penalty for late performance of 28.7 billion won, and compensation for unauthorized occupation of 1 billion won. At that time, Gyeonggi stated that violations of the development deadline obligation in the basic agreement (August 2020) were cited as grounds for the penalties.
K-Culture Valley is a project aimed at developing a 326,400 square meter site in Janghang-dong, Ilsandong-gu, Goyang City, into a K-pop arena, theme park, and commercial and tourism facilities. The total project cost was expected to be 1.8 trillion won, but the progress rate remained at 3%. Gyeonggi Province ultimately dissolved the basic agreement signed in 2016 in June last year.
Subsequently, Gyeonggi Province conducted a public offering for private operators regarding the T2 site, a large area of 158,000 square meters, including the arena site, attracting four companies to apply, including the Korean subsidiary of the American event planning company Live Nation.