The ‘Big 3’ K-pop companies really don’t want to comply with new government regulations


SM Entertainment, YG Entertainment, and JYP Entertainment are required to register as agencies with the government by July 28 or risk becoming illegitimate, which seems like a significant deal.

So why haven’t they? Because that would require abiding by the new act.

According to the Popular Culture Industry Act by the Ministry of Culture Sports and Tourism, which will go into full effect next month, entertainment agencies must obtain a government-approved certificate in order to continue their business as a legal entity.

What’s that act all about, right?

Well it was primarily initiated in order to prevent those unfair contracts that always seem to come up in K-pop.

“Entertainment agencies seem to be avoiding the responsibilities that will immediately follow once they are registered,” said Kang Min-ju, a lawyer at Hankug Law Firm, who participated in establishing a standard form contract for the cinematographers’ union. “For example, when the agency is registered as an official entertainment business by the government, it has to follow the FTC’s rigorous standard contract form – which restricts the maximum contract period to seven years.”

“Contract breach is another issue. When an entertainer cancels a contract in the middle of the term, registered agencies can no longer charge double or triple what they are suppose to ask for,” said Kang.

Well that sounds promising.

My argument for the Big 3 would’ve been that it’s understandable to delay until the last moment since why would they want to cede anything before necessary, but Cube Entertainment, Key East Entertainment, and FNC Entertainment have already registered.

“We don’t know why and it’s impossible to find out the reasons behind the three agencies’ (SM, YG and JYP) late registration despite a year grace period. For SM and YG, if they don’t certify their business by this Friday, they will have to register as a newly established entertainment, which will be another month of delay,” KOCCA officials said.

In any case, those three companies certainly aren’t going anywhere any time soon, and it’ll all get worked out.

The main point, though, is that change is apparently coming to contract law in K-pop, with contracts after July being standardized. We’ll still have to see whether this is enforced effectively and what (if any) consequences emerge as a result, but from a layman’s perspective, this appears to be a positive step in the right direction that may help to reduce the almost constant distraction of contract lawsuits.


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