SEOUL, South Korea (CelebrityAccess) — On June 24, 2025, the Korea Fair Trade Commission (KFTC) officially announced the details of a finalized consent decision with five major entertainment companies—HYBE, SM Entertainment, YG Entertainment, JYP Entertainment, and Starship Entertainment—regarding suspected violations of the Subcontracting Act.
The KFTC’s investigation, launched in July 2023, focused on the companies’ failure to issue timely written contracts when outsourcing work to small and medium-sized enterprises (SMEs) for album production, merchandise, video content, and concert-related services.
In response, the five companies submitted corrective proposals in April and May 2024 aimed at improving subcontracting practices and strengthening SME partnerships. Following a period of public and stakeholder consultation, the KFTC approved and finalized these measures.
Key Measures Include:
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Creation and distribution of standard and preliminary contracts tailored to different types of outsourced work.
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Implementation of electronic contracting systems and improved internal contract management tools.
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Publication of subcontracting guidelines online and mandatory training for company staff on the Subcontracting Act.
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A KRW 1 billion support fund (KRW 200 million per company) to assist partner SMEs with needs such as safety and filming equipment.
These measures aim to enhance transparency, ensure fairer contract practices, and reduce business risks for SMEs operating within Korea’s entertainment industry.
