ENFORCEMENT DECREE OF THE VENTURE INVESTMENT PROMOTION ACT

영문법령 불러오는 중…

ENFORCEMENT DECREE OF THE VENTURE INVESTMENT PROMOTION ACT — 법갈피

Article 4(Requirements for registration of professional individual investors) #

"Requirements prescribed by Presidential Decree in terms of investment performance, experience, qualifications, etc." in Article 9 (2) of the Act means any of the following: <Amended on Apr. 6, 2021; Aug. 9, 2022; Oct. 17, 2023; Dec. 19, 2023; Jul. 2, 2024; Aug. 5, 2025>

1. The sum of the investments which satisfy the following requirements (where a person falling under any item of subparagraph 2 is an operating partner of an individual investment association, the amount of the investment made by the relevant association shall include the amount obtained by multiplying the investment amount meeting all of the following requirements by the investment ratio) is at least 50 million won for the most recent three years, which is at least the amount determined and publicly notified by the Minister of SMEs and Startups:

(a) Investment shall be made by means of the acquisition of stocks issued by a person falling under any subparagraph of Article 10 (1) of the Act (limited to a person not listed on the securities market under Article 8-2 (4) 1 of the Financial Investment Services and Capital Markets Act (excluding the securities market determined and publicly notified by the Financial Services Commission under Article 11 (2) of the Enforcement Decree of the same Act; hereinafter referred to as "securities market")) or equity interests, by means of a simple agreement for future equity or a convertible note agreement;

(b) The stocks or equity interests shall not be those issued by a specially related person under Article 3 (1) of the Act on Corporate Governance of Financial Companies (hereinafter referred to as "related person");

(c) The person shall hold the stocks or equity interests for at least six months from the acquisition or it shall have passed six months since the payment for investment upon conclusion of a simple agreement for future equity or a convertible note agreement;

2. Any of the following persons:

(a) A person who meets one of the following qualifications:

(i) A person with national technical qualification under Article 10 of the National Technical Qualifications Act;

(ii) An attorney-at-law registered under Article 10 of the Attorney-at-Law Act (hereinafter referred to as "attorney-at-law");

(iii) A certified public accountant registered under Article 7 of the Certified Public Accountant Act (hereinafter referred to as a "certified public accountant");

(iv) A patent attorney registered under Article 5 of the Patent Attorney Act (hereinafter referred to as "patent attorney");

(v) A management consultant or technology consultant registered under Article 8 of the Act on Management Consultants and Technology Consultants;

(vi) A person with a doctoral degree (limited to majors in science, technology, engineering, and mathematics or business and economics);

(vii) A person with a bachelor's degree (limited to majors in science, technology, engineering, and mathematics or business and economics) who has worked at any of the following institutions for at least four years (including a career before acquiring a degree):

(b) A person who has engaged in investment examination for at least two years or any business related to investment for at least three years at any of the following companies or accelerators:

(i) A venture investment company;

(ii) A limited company or a limited liability company under Article 50 (1) 5 of the Act;

(iii) A new technology venture capitalist defined in subparagraph 14-3 of Article 2 of the Specialized Credit Finance Business Act or a specialized new technology venture financing company under subparagraph 14-4 of that Article (hereinafter referred to as "new technology venture capitalist or other relevant entity");

(iv) A company specializing in the start-up of new technology-based businesses defined in Article 2 (8) of the Special Act on the Promotion of Venture Businesses (hereinafter referred to as "company specializing in the start-up of new technology-based businesses");

(v) A technology holding company prescribed in Article 21-3 of the Technology Transfer and Commercialization Promotion Act;

(vi) A technology holding company prescribed in Article 36-2 of the Industrial Education Enhancement and Industry-Academia-Research Cooperation Promotion Act;

(c) A founder of a stock-listed corporation under Article 9 (15) 3 of the Financial Investment Services and Capital Markets Act (limited to a person registered as a director at the time of listing) or the CEO at the time of listing;

(d) A person who is, or was, the founder of a venture business, the annual sales of which recorded at least 100 billion won while he or she was in office;

(e) Other persons who meet the standards determined and publicly notified by the Minister of SMEs and Startups, in terms of the completion of training courses, investment-related career backgrounds, etc.

Article 6(Organization and registration of individual investment associations) #

(1) "Persons meeting the criteria prescribed by Presidential Decree in terms of the purpose of investment, the equity amount, etc." in Article 12 (1) 2 of the Act means persons who satisfy all of the following criteria: <Amended on Dec. 20, 2022>

(2) "Requirements prescribed by Presidential Decree in terms of the total partners' equity amount, the number of partners, the term of existence, etc." in Article 12 (2) of the Act means the following; in such cases, where all or part of the investment is made in U.S. dollars, the amount of equity shares under subparagraphs 1 and 2 shall be calculated by converting U.S. dollars into Korean won as of the date of registration of the individual investment association: <Amended on Aug. 5, 2025>

1. The total amount of equity shares shall be at least 100 million won;

2. A unit of equity share shall be at least one million won;

3. It shall have not more than 49 partners; in such cases, where the investor is a person prescribed by Decree of the Ministry of SMEs and Startups, such as a private venture fund of funds, the investor shall be counted as one partner;

4. The term of existence shall be at least five years.

(3) "Requirements prescribed by Presidential Decree" in the latter part of Article 12 (3) means the following requirements:

1. The equity interest shall be at least three percent of the total amount of equity shares;

2. Deleted; <Dec. 19, 2023>

3. An individual under Article 12 (1) 1 of the Act shall satisfy any of the following requirements:

(a) That he or she shall be a professional individual investor;

(b) That he or she shall be a person with at least five years of experience as an operating partner of an individual investment association;

(d) That he or she shall have completed the training course regarding the operation and management of individual investment associations determined and publicly notified by the Minister of SMEs and Startups, such as the training course for operating partners of individual investment associations.

(4) "Finance-related statute or regulation prescribed by Presidential Decree" in Article 12 (4) 5 and 6 of the Act means the following statutes: <Added on Dec. 19, 2023>

1. The Act on the Structural Improvement of the Financial Industry;

2. The Financial Consumer Protection Act;

3. The Act on Real Name Financial Transactions and Confidentiality;

4. The Act on the Establishment of Financial Services Commission;

5. The Act on Corporate Governance of Financial Companies;

6. The Korea Technology Finance Corporation Act;

7. The Corporate Restructuring Investment Companies Act;

8. The Insurance Business Act;

9. The Industrial Development Act;

10. The Mutual Savings Banks Act;

11. The Community Credit Cooperatives Act;

12. The Credit Guarantee Fund Act;

13. The Credit Information Use and Protection Act;

14. The Credit Unions Act;

15. The Specialized Credit Finance Business Act;

16. The Banking Act;

17. The Foreign Investment Promotion Act;

18. The Foreign Exchange Transactions Act;

19. The Financial Investment Services and Capital Markets Act;

20. The Asset-Backed Securitization Act.

Article 8(Restrictions on Acts by operating partners of individual investment associations) #

(1) "Real property for business purposes ... such as a business incubator defined in Article 53 (1) of the Support for Small and Medium Enterprise Establishment Act, within the scope prescribed by Presidential Decree" in Article 14 (2) 4 of the Act means any of the following: <Amended on Jun. 28, 2022>

1. A business incubator under Article 53 (1) of the Support for Small and Medium Enterprise Establishment Act (hereinafter referred to as "business incubator");

2. An office exclusively for investment business, which meets the standards determined and publicly notified by the Minister of SMEs and Startups.

(2) "Acts prescribed by Presidential Decree" in Article 14 (2) 5 of the Act means any of the following: <Amended on Oct. 21, 2021; Aug. 23, 2022>

1. Making an investment in any of the types of business falling under any subparagraph of Article 2;

2. Acquiring or holding stocks, unsecured convertible bonds, unsecured exchangeable bonds, unsecured bonds with warrant, or equity interests (hereinafter referred to as "stocks, etc.") of any of the following persons:

(a) Financial companies, etc. defined in subparagraph 1 of Article 2 of the Act on Real Name Financial Transactions and Confidentiality (hereinafter referred to as "financial companies, etc."); provided, they shall not include financial companies, etc. providing financial and insurance services, whose main business (referring to the main business prescribed in Article 4 of the Enforcement Decree of the Framework Act on Small and Medium Enterprises; hereinafter the same shall apply) is the business of providing financial services utilizing information and communications technology determined and publicly notified by the Minister of SMEs and Startups (excluding other credit financial businesses according to the Korean Standard Industrial Classification);

(b) An institutional private equity fund for improving corporate structure referred to in Article 20 of the Industrial Development Act (hereinafter referred to as "institutional private equity fund for improving corporate structure");

(c) An institutional private equity fund referred to in Article 9 (19) 1 of the Financial Investment Services and Capital Markets Act (hereinafter referred to as "institutional private equity fund");

(d) A general private equity fund defined in Article 9 (19) 2 of the Financial Investment Services and Capital Markets Act (hereinafter referred to as "general private equity fund");

3. Selling assets held by an association to any of the following persons or purchasing stocks, etc. issued or held by any of the following persons with the property of the association:

(a) The relevant operating partner;

(b) A person related to the relevant operating partner;

(c) The major shareholder (referring to a person who holds stocks or equity interests amounting to at least 10 percent of the total voting stocks or equity interests on his or her account, in whosesoever name, or a person who exercises de facto control over key management issues by means of appointment or dismissal of executive officers; hereinafter the same shall apply) of the relevant operating partner and a person related thereto;

(d) A major partner of an individual investment association organized by the relevant operating partner (referring to a partner who holds at least 10 percent of the equity interests on his or her account, in whosesoever name; hereinafter the same shall apply) and a person related thereto;

(e) Any of the following associations or collective investment schemes for which the relevant operating partner serves as an operating partner or general partner;

(i) An Individual investment association;

(ii) A venture investment association;

(iii) An institutional private equity fund for improving corporate structure;

(iv) An institutional private equity fund;

(v) A general private equity fund;

(vi) A new technology venture investment association under the Specialized Credit Finance Business Act (hereinafter referred to as "Specialized Credit Finance Business Act");

4. Extending credit (referring to the lending of property with an economic value, such as money and securities, providing guarantee for the performance of debt obligations, or purchasing securities for financial support; hereinafter the same shall apply) to a person who falls under any item of subparagraph 3; provided, this shall not apply to credit extension made for purposes of exercising security rights;

5. Acquiring stocks or acting as a broker for funding for a third party, in the name of an individual investment association;

6. Receiving funds through any transaction other than normal transactions arising from investment, such as borrowing money from a company in which the individual investment association invests or selling off assets;

7. Making investments on conditions other than those prescribed in an investment contract;

8. Other acts involving direct or indirect transactions that might undermine the sound asset management or sound trading practices of the individual investment association or incur a transactional credit risk, as determined and publicly notified by the Minister of SMEs and Startups.

Article 9(Exceptions to restrictions on Acts by operating partners of individual investment associations) #

"Cases prescribed by Presidential Decree" in the proviso, with the exception of the subparagraphs, of Article 14 (2) of the Act means the following: <Amended on Dec. 20, 2022; Aug. 5, 2025>

1. Where an operating partner conducts an act provided in Article 14 (2) 3 of the Act and falls under the following cases:

(a) Where an enterprise, which has issued stocks, etc. held by an individual investment association, belongs to a business group subject to limitations on cross shareholding under Article 31 of the Monopoly Regulation and Fair Trade Act (hereinafter referred to as "business group subject to limitations on cross shareholding") (excluding where an operating partner of an individual investment association and the company which has issued such stocks, etc. belong to the same business group subject to cross shareholding);

(b) Where an enterprise, which has issued stocks, etc. held by an individual investment association, exchanges stocks with, transfers stocks to, or merges with a company belonging to a business group subject to limitations on cross shareholding (excluding where an operating partner of an individual investment association belongs to the same business group subject to cross shareholding as the company which has issued such stocks, et., the company that has exchanged or transferred stocks, or the company that survives or is newly established after the merger);

2. Where an operating partner conducts an act prescribed in subparagraph 3 or 4 of Article 8 (2) and falls under the following cases:

(a) Where a prior consent of all partners is obtained;

(b) Where any unavoidable circumstances exist as recognized by the Minister of SMEs and Startups, such as the dissolution of a private investment association or recovery of investment equity interests that cannot be sold to a third party;

(c) Where a major shareholder of the relevant operating partner or a major partner of an individual investment association organized by the relevant operating partner falls under any of the following subitems and where a person related to the major shareholder or major partner is a counterpart to such act [limited to a person prescribed by the following statutes or regulations as a subsidiary or invested company (excluding subsidiaries or invested companies related to a person who exercises de facto control over key management issues of major shareholders or major partners)]:

(i) A technology holding company prescribed in Article 21-3 of the Technology Transfer and Commercialization Promotion Act;

(ii) A technology holding company prescribed in Article 36-2 of the Industrial Education Enhancement and Industry-Academia-Research Cooperation Promotion Act;

(iii) A company specializing in the start-up of new technology-based businesses;

(d) Where the major partner of an individual investment association organized by the relevant operating partner is a fund of funds for venture investment referred to in Article 70 (1) of the Act (hereinafter referred to as the "Fund of Funds") and where another venture investment association or individual investment association related to the major partner is a counterpart to such act.

[This Article Wholly Amended on Aug. 23, 2022]

Article 13(Requirements for registration of accelerators) #

(1) "Amount prescribed by Presidential Decree" in the former parts of Article 24 (2) 1 (b) and (c) of the Act means 50 million won; provided, the amount means 10 million won in the case of a dedicated institution designated under Article 52 of the Support for Small and Medium Enterprise Establishment Act. <Amended on Jun. 28, 2022>

(2) "Finance-related statute or regulation prescribed by Presidential Decree" in Article 24 (2) 2 (e) and (f) of the Act means the statutes listed in Article 6 (4). <Amended on Dec. 19, 2023>

(3) "Person prescribed by Presidential Decree" in Article 24 (2) 2 (g) and (h) of the Act means any of the following persons:

1. A person authorized to represent the relevant accelerator;

2. An auditor;

3. A person who gives an instruction to commit an offense that constitutes a ground for the revocation of registration.

(4) "Standards prescribed by Presidential Decree" in Article 24 (2) 4 of the Act means the following: <Amended on Jun. 28, 2022; Aug. 9, 2022; Oct. 17, 2023; Dec. 19, 2023>

1. The person shall have at least two full-time professionals who fall under any of the following; provided, a person falling under Article 37 (2) 2 (g) or (h) of the Act, for whom three years have not passed since the revocation of registration or since he or she was notified of the grounds for such revocation (five years from the cancellation of registration, where five years have elapsed since the date of such cancellation), shall be excluded herefrom:

(a) A person falling under subparagraph 2 (a) of Article 4; provided, a person falling under subparagraph 2 (a) 5) of Article 4 shall have at least three years of experience in the relevant field:

(b) A person falling under subparagraph 2 (b) through (d) of Article 4;

(c) A person with a master's degree (limited to majors in science, technology, engineering, and mathematics or business and economics) who has engaged in the relevant field for at least three years (including a career before acquiring a degree);

(d) A person with a bachelor's degree, who conducted, or has conducted, investment examination (excluding loan examination) for at least three years (including a career before acquiring a degree) at an institution subject to inspection (excluding a new technology venture capitalist or other relevant entity) under Article 38 of the Act on the Establishment of Financial Services Commission or at a foreign company (including its affiliates and branches) engaging in businesses equivalent to those of a venture investment company;

(e) A director of a company (limited to a registered person), who has sold the company to another company for at least five billion won;

(f) A professional individual investor;

(g) A person who has served as an operating partner of an individual investment association for at least three years;

(h) A person who has at least three years of experience in startup planning, such as the selection of, and investment in, early stage startups, and incubation thereof at any of the following companies or institutions:

(i) An accelerator;

(ii) A venture investment company;

(iii) A business incubator;

(iv) A dedicated institution defined in Article 52 of the Support for Small and Medium Enterprise Establishment Act;

(i) A person who satisfies all of the following requirements:

(i) The person shall have engaged in management or technology development for at least three years at an institution recognized and publicly notified by the Minister of SMEs and Startups, such as a company under the Commercial Act;

(ii) The person shall have completed the training course for professional accelerators recognized by the Minister of SMEs and Startups;

(j) Other persons who meet the standards determined and publicly notified by the Minister of SMEs and Startups in terms of incubation of business start-ups and investment business;

2. An office space for incubating early stage startups, which satisfies the standards determined and publicly notified by the Minister of SMEs and Startups.

(5) A person who intends to organize a venture investment association under Article 24 (3) of the Act shall meet all of the following requirements:

1. Where the venture investment association is organized with the amount of at least 10 billion won, the capital referred to in each item of Article 24 (2) 1 of the Act, or the property contributed for, or invested in, the business prescribed in Articles 25 and 26 of the Act shall account for at least one percent of such amount;

2. The debt ratio shall not exceed 200 percent;

Article 16(Restrictions on acts of accelerators) #

"Acts prescribed by Presidential Decree" in Article 27 (1) 3 of the Act means any of the following acts: <Amended on Oct. 21, 2021; Dec. 28, 2021; Aug. 23, 2022>

1. Making an investment in any of the types of business falling under any subparagraph of Article 2;

2. Acquiring or holding the stocks, etc. of any of the following persons:

(a) Financial companies, etc.; provided, any of the following financial companies, etc. shall be excluded herefrom:

(i) Financial companies, etc., whose main business is to provide financial and insurance services utilizing information and communications technology determined and publicly notified by the Minister of SMEs and Startups (excluding other credit financial businesses according to the Korean Standard Industrial Classification);

(ii) A venture investment association;

(b) An institutional private equity fund for improving corporate structure;

(d) A general private equity fund;

(e) An affiliate defined in subparagraph 12 of Article 2 of the Monopoly Regulation and Fair Trade Act (hereinafter referred to as "affiliate"), from among persons related to the relevant accelerator;

(f) A major shareholder of the relevant accelerator;

3. Extending credit to a major shareholder (including a person related thereto) or an affiliate of the relevant accelerator; provided, this shall not apply to credit extension made for purposes of exercising security rights;

4. Making an investment for purposes of acquiring management control as prescribed by Ministerial Decree of the SMEs and Startups;

5. Providing security or offering guarantee for debt obligations with the assets of an accelerator for a third party;

6. Acquiring stocks or acting as a broker for funding for a third party, in the name of an accelerator;

7. Receiving funds through any transaction other than normal transactions arising from investment, such as borrowing money from a company in which the individual investment association invests or selling off assets;

8. Making an investment on conditions other than those prescribed in an investment contract;

9. The following acts that might undermine the soundness of an accelerator’s asset management due to loans extended to executive officers and employees by the accelerator:

(a) Lending money to an executive officer even though the remainder of the loan to be repaid to the accelerator exceeds the annual salary of the executive officer (referring to a salary subject to taxation of income tax, paid by the accelerator during the executive officer's continuous service period);

(b) Lending money to an executive officer or employee even though the aggregate of the remainder of the loan to be repaid by the executive officer or employee to the accelerator exceeds 25/100 of the total capital of the relevant accelerator;

10. Other acts involving direct or indirect transactions that might undermine the soundness of asset management or sound trading practices of an accelerator or incur a transactional credit risk, as determined and publicly notified by the Minister of SMEs and Startups.

Article 17(Exceptions to restrictions on acts of accelerators) #

"Cases prescribed by Presidential Decree" in the proviso of the main clause of Article 27 (1) of the Act means the following cases: <Amended on Dec. 19, 2023; Aug. 5, 2025>

1. Where an accelerator conducts an act provided in Article 27 (1) 1 of the Act and falls under the following:

(a) Where an enterprise, which has issued stocks, etc. held by an accelerator, belongs to a business group subject to limitations on cross shareholding (excluding where the accelerator and the enterprise which has issued the stocks, etc. become belonging to the same business group subject to limitations on cross shareholding);

(b) Where an enterprise, which has issued stocks, etc. held by an accelerator, exchanges or transfers stocks or merges with a company belonging to a business group subject to limitations on cross shareholding (excluding where an accelerator belongs to the same business group subject to cross shareholding as the company which has issued such stocks, et., the company that has exchanged or transferred stocks, or the company that survives or is newly established after the merger);

2. Where an accelerator conducts an act provided in the main clause of Article 27 (1) 2 of the Act and falls under the following:

(a) Where an accelerator owns real estate in which his or her head office or main office is located that meets all of the following requirements:

(i) It shall directly use at least 10 percent of the total floor area of the relevant real estate for the purposes specified in the subparagraphs of Article 8 (1);

(ii) The real estate shall be an object under a single ownership; provided, where the relevant real estate is under a divided ownership in a single building, several floors under the divided ownership shall be adjoined or can be physically recognized as a single real estate;

(b) Where an accelerator owns real estate to be directly used as a company house, training facilities, and welfare facilities for executive officers and employees of the accelerator;

2-2. Where an accelerator who concurrently operates the business of a new technology venture capitalist or other relevant entity falls under any of the following:

(a) Where the accelerator participates as a member of a new technology venture capital investment association under subparagraph 14-5 of Article 2 of the Specialized Credit Finance Business Act and acquires investment shares in the new technology venture capital investment association;

(b) Where the accelerator acquires stocks, etc. of a collective investment scheme while participating as an operating partner or managing member of any of the following collective investment schemes pursuant to the Industrial Development Act or the Financial Investment Services and Capital Markets Act:

(i) An institutional private equity fund for improving corporate structure;

(ii) An institutional private equity fund;

(iii) A general private equity fund;

2-3. Where an accelerator holds stocks, etc. of a person falling under any item of subparagraph 2 of Article 16, and falls under any of the following:

(a) Where an enterprise, which has issued stocks, etc. held by the accelerator, is another accelerator and the other accelerator files for registration as a venture investment company, a new technology venture capitalist or other relevant entity; in such cases, the accelerator shall dispose of the stocks, etc. in its possession within 9 months from the date of registration under the former part;

(b) Where an enterprise, which has issued stocks, etc. held by the accelerator, is a limited company or a limited liability company under Article 50 (1) 5 of the Act and the limited company or the limited liability company files for registration as a venture investment company; in such cases, the accelerator shall dispose of the stocks, etc. in its possession within 9 months from the date of registration under the former part;

3. Where an accelerator holds stocks, etc. of an affiliate under subparagraph 2 (d) of Article 16 and falls under the following:

(a) Where a major shareholder of the relevant accelerator, who falls under any of the following, acquires the stocks, etc. of a company prescribed as a subsidiary or invested company by any of the following statutes or regulations (excluding a subsidiary, which is an affiliate, or invested company of a person who exercises de facto control over key management issues of major shareholders), from among the companies under his or her control:

(i) A technology holding company prescribed in Article 21-3 of the Technology Transfer and Commercialization Promotion Act;

(ii) A technology holding company prescribed in Article 36-2 of the Industrial Education Enhancement and Industry-Academia-Research Cooperation Promotion Act;

(iii) A company specializing in the start-up of new technology-based businesses;

(b) Where an accelerator conducts an act of investment for purposes of management control as prescribed by Decree of the Ministry of SMEs and Startups and all of the following requirements are satisfied:

(i) Deleted; <Aug. 5, 2025>

(ii) The accelerator shall continue to hold the stocks or equity interests of the relevant early stage startup until six months from the acquisition of management control (such period may be shortened where the Ministry of SMEs and Startups deems that holding the stocks or equity interests is likely to pose a clear threat to the interests of the accelerator);

(iii) The accelerator shall sell off all the stocks or equity interests of the relevant early stage startup within seven years from the acquisition of management control (such period may be extended by up to one year where the Ministry of SMEs and Startups deems that there is any reason for which it is impracticable to sell off the relevant stocks or equity interests, such as prolonged agreement for sale between the parties).

[This Article Wholly Amended on Aug. 23, 2022]

Article 23(Requirements for registration of venture investment companies) #

(1) "Requirements prescribed by Presidential Decree" in Article 37 (2) 1 of the Act means the following: <Amended on Dec. 19, 2023>

1. The paid-in capital shall be at least two billion won;

2. The share of borrowed money in the paid-in capital shall be less than 20 percent.

(2) "Any other finance-related statute or regulation prescribed by Presidential Decree" in Article 37 (2) 2 (e) and (f) of the Act means any of the statutes listed in the subparagraphs of Article 6 (4) (hereafter in this Article referred to as "finance-related statutes or regulations"). <Amended on Dec. 19, 2023>

(3) "Person prescribed by Presidential Decree" in Article 37 (2) 2 (g) and (h) of the Act means any of the following persons:

1. A chief executive officer;

2. An auditor;

3. A person who gives an instruction to commit an offense that constitutes a ground for the revocation of registration.

(4) "Person prescribed by Presidential Decree" in Article 37 (2) 2 (j) of the Act means a person whose debts of more than 10 million won remain overdue for at least three months after the agreed-upon repayment deadline.

(5) "Partner prescribed by Presidential Decree" in Article 37 (2) 2 (k) of the Act means any of the following persons: <Amended on Dec. 19, 2023>

1. The person himself or herself, where the person and a person related own the largest portion of outstanding voting stocks or equity interests and where the number of such stocks or equity interests exceeds 10 percent of the total number of outstanding voting stocks or equity interests;

2. A person who holds at least 30 percent of the total number of the outstanding voting stocks or equity interests, in whosesoever name, on his or her own account;

3. A shareholder who exercises de facto control over key management issues of the relevant venture investment company by means of appointment or dismissal of executive officers, etc.

(6) "Social credit as prescribed by Presidential Decree" in Article 37 (2) 3 of the Act means cases where all the following requirements are met; provided, this shall not apply where a violation is deemed to be minor by the Minister of SMEs and Startups:

1. A large shareholder shall not have any criminal record of having been imposed a fine or heavier punishment for violating the Act, any of the finance-related statutes or regulations, the Monopoly Regulation and Fair Trade Act, or the Punishment of Tax Offenses Act for the latest three years; provided, this shall not apply where the shareholder was punished under the joint penalty provisions in Article 79 of the Act or any other relevant statute;

2. A large shareholder shall not have any record of disrupting order in credit transactions by defaulting on debts, etc. for the latest three years;

3. A large shareholder shall not have any record of having been designated as a failing financial institution under the Act on the Structural Improvement of the Financial Industry or having permission, authorization, or registration of his or her business revoked under the Act or finance-related statutes or regulations.

(7) "Standards prescribed by Presidential Decree" in Article 37 (2) 4 of the Act means the following: <Amended on Aug. 9, 2022; Dec. 19, 2023>

(a) A person falling under subparagraph 2 (a) of Article 4; provided, a person falling under subparagraph 2 (a) 5) of Article 4 shall have at least three years of experience in the relevant field:

(b) A person falling under subparagraph 2 (b) through (d) of Article 4;

(e) A person who satisfies all of the following requirements:

(ii) The person shall have completed training courses for professionals of venture investment companies recognized by the Minister of SMEs and Startups;

(f) Any other person who meets the qualifications determined and publicly notified by the Minister of SMEs and Startups;

2. The person shall have an office exclusively for the investment business, which satisfies the standards determined and publicly notified by the Minister of SMEs and Startups.

[Title Amended on Dec. 19, 2023]

Article 24(Investment obligations of venture investment companies) #

(1) "Ratio prescribed by Presidential Decree" in Article 38 (1) of the Act means 40 percent.

(2) The investment ratio of a venture investment company under Article 38 (1) of the Act shall be calculated in accordance with the following standards: <Amended on Aug. 23, 2022; Oct. 17, 2023; Dec. 19, 2023; Aug. 5, 2025>

1. The ratio shall be calculated based on the amount of the investment made by the method prescribed by Decree of the Ministry of SMEs and Startups, which is used for the business activities prescribed in Article 37 (1) 1 through 3, 6, and 7 of the Act; provided, this shall not include the amount invested after listing on the securities market;

2. Notwithstanding subparagraph 1, where a venture investment company acquires the stocks of a business startup that an individual, an individual investment association, or a venture investment association determined and publicly notified by the Minister of SMEs and Startups has held for at least three years (limited to the acquisition of the stocks newly issued at the time of acquisition by the individual, individual investment association, or venture investment association determined and publicly notified by the Minister of SMEs and Startups), the amount of such acquisition shall be included in the calculation;

3. Any of the following contributions or capital shall not be included in the total assets under management by a venture investment company (referring to the sum of the capital and combined contributions by all venture investment associations under management; hereafter in this paragraph the same shall apply):

(a) Contribution by a venture investment association with less than three years of history;

(b) Contribution by a venture investment association which satisfies the standards determined and publicly notified by the Minister of SMEs and Startups, such as a venture investment association which acquires or merges with a small or medium enterprise or a venture company or which purchases stocks or other assets held by another venture investment association, etc.;

(c) Contribution by a venture investment association whose investment ratio is separately determined under Article 70 (5) of the Act;

(d) The capital of the relevant venture investment company, where the total amount of equity shares in the venture investment associations under its management is at least 200 percent of the paid-in capital of the venture investment company;

(e) Contribution made by a private venture fund of funds under management by a venture investment company;

4. Where there is an increase or decrease in the total assets managed by the venture investment company, compared with the total assets at the time of registration, they shall be calculated as follows:

(a) In the case of an increase: The investment ratio for the increase shall be calculated by year as of the date of such increase;

(b) In the case of a decrease, the investment ratio shall be calculated on the basis of the total assets after such decrease.

[Title Amended on Dec. 19, 2023]

Article 25(Restrictions on acts of venture investment companies) #

"Acts prescribed by Presidential Decree" in Article 39 (1) 3 of the Act means any of the following: <Amended on Oct. 21, 2021; Aug. 23, 2022; Dec. 19, 2023; Aug. 5, 2025>

1. Making an investment in any of the types of business falling under any subparagraph of Article 2;

2. Acquiring or holding the stocks, etc. of any of the following persons:

(a) Financial companies, etc.; provided, any of the following financial companies, etc. shall be excluded herefrom:

(ii) A venture investment association;

(iii) A company which exclusively manages privately placed funds referred to in Article 9 (19) of the Financial Investment Services and Capital Markets Act;

(b) An institutional private equity fund for improving corporate structure;

(d) A general private equity fund;

(e) An affiliate of the relevant venture investment company among the persons related to the relevant venture investment company;

(f) A major shareholder of the relevant venture investment company;

(g) A company engaged in the cultural industry under Article 43 of the Framework Act on the Promotion of Cultural Industries (hereinafter referred to as "company engaged in the cultural industry"), in which a person falling under item (e) or (f) has invested;

3. Extending credit to a major shareholder (including a person related thereto) or an affiliate of the relevant venture investment company; provided, this shall not apply to credit extension for purposes of exercising security rights;

4. Making an investment for purposes of acquiring management control as prescribed by Ministerial Decree of the SMEs and Startups;

5. Providing a collateral or debt guarantee with the assets of the venture investment company for a third party;

6. Acquiring stocks or acting as a broker for a third party, in the name of a venture investment company;

7. Receipt of funds by a venture investment company through any transaction other than normal transactions arising from investment, such as borrowing money from a company it has invested in or selling off assets;

8. Making an investment on conditions other than those prescribed in an investment contract;

9. The following acts that might undermine the soundness of asset management of a venture investment company due to the extension of loans to its executive officers or employees:

(a) Lending money to an executive officer even though the remainder of the loan to be repaid by the executive officer to a venture investment company exceeds the annual salary of the executive officer (referring to a salary subject to taxation of income tax, paid by the venture investment company during the executive officer's continuous service period);

(b) Lending money to its executive officer or employees even though the sum of the remainder of loans to be repaid by the executive officers or employees to the venture investment company exceeds 25/100 of the total capital of the venture investment company;

10. Other acts involving direct or indirect transactions that might undermine the sound asset management or sound trading practices of the venture investment company or incur a transactional credit risk, as determined and publicly notified by the Minister of SMEs and Startups.

[Title Amended on Dec. 19, 2023]

Article 26(Exceptions to restrictions on acts of venture investment companies) #

"Cases prescribed by Presidential Decree" in the proviso to Article 39 (1) of the Act means any of the following cases: <Amended on Oct. 21, 2021; Aug. 23, 2022; Dec. 19, 2023; Aug. 5, 2025>

1. Where a venture investment company conducts an act provided in Article 39 (1) 1 of the Act and falls under the following cases:

(a) Where an enterprise, which has issued stocks, etc. held by a venture investment company, belongs to a business group subject to limitations on cross shareholding (excluding where a venture investment company and an enterprise which has issued the stocks, etc. become belonging to the same business group subject to limitations on cross shareholding);

(b) Where an enterprise, which has issued stocks, etc. held by a venture investment company, exchanges or transfers stocks or merges with a company belonging to a business group subject to limitations on cross shareholding (excluding where a venture investment company belongs to the same business group subject to cross shareholding as the company which has issued such stocks, et., the company that has exchanged or transferred stocks, or the company that survives or is newly established after the merger);

(c) Where a venture investment company engages in exchange or transfer of stocks, etc. with any of the following companies that hold stocks, etc. of a company belonging to a business group subject to limitations on cross shareholding or merges with such company, and where nine months have not passed since the venture investment company acquired the stocks, etc. of the company belonging to the business group subject to limitations on cross shareholding as a result of the exchange or transfer of stocks, etc. or merger:

(i) A new technology venture capitalist or other relevant entity;

(ii) A limited company or a limited liability company under Article 50 (1) 5 of the Act;

(d) Where an investment is made in any of the projects recognized and publicly notified by the Minister of SMEs and Startups, such as a cultural content project, via a company engaged in the cultural industry belonging to a business group subject to limitations on cross shareholding (excluding where a venture investment company belonging to a business group subject to limitations on cross shareholding makes an investment by means of acquiring or holding the stocks, etc. of a company engaged in the cultural industry belonging to the same business group subject to limitations on cross shareholding);

2. Where a venture investment company conducts an act provided in the main clause of Article 39 (1) 2 of the Act and falls under the following cases:

(a) Where the venture investment company owns the real estate in which his or her head office is located that meets all the following requirements:

(i) It shall directly use at least 10 percent of the total floor area of the relevant real estate for the purposes specified in the subparagraphs of Article 8 (1);

(b) Where the venture investment company owns real estate to be directly used as a company house, training facilities, and welfare facilities for its executive officers and employees;

(c) Where a venture investment company merges with any of the following companies and one year has not passed since the acquisition of the real estate as a result of the merger:

(i) A new technology venture capitalist or other relevant entity;

(ii) A limited company or a limited liability company under Article 50 (1) 5 of the Act;

3. Where a venture investment company holds stocks, etc. of a person falling under any item of subparagraph 2 of Article 25, and falls under any of the following:

(a) Where a venture investment company acquires stocks of another venture investment company, a new technology venture capitalist or other relevant entity for purposes of acquisition or merger; provided, where such acquisition or merger does not happen within six months from the date of initial acquisition of stocks, etc., it shall dispose of the acquired stocks, etc. within nine months from the date of initial acquisition thereof;

(b) Where it serves as an operating partner of an association or as a general partner of a collective investment scheme, falling under any of the following:

(i) An institutional private equity fund;

(ii) A general private equity fund;

(iii) An association or company established under other statutes or regulations, whose business affairs are deemed by the Minister of SMEs and Startups to be suitable for a venture investment company and publicly notified by the Minister;

(c) Where an enterprise, which has issued stocks, etc. held by a venture investment company, is an accelerator and the accelerator files for registration as a venture investment company, a new technology venture capitalist or other relevant entity; in such cases, the venture investment company shall dispose of the stocks, etc. in its possession within 9 months from the date of registration under the former part;

(d) Where an enterprise, which has issued stocks, etc. held by a venture investment company, is a limited company or a limited liability company under Article 50 (1) 5 of the Act and the limited company or the limited liability company files for registration as a venture investment company; in such cases, the venture investment company shall dispose of the stocks, etc. in its possession within 9 months from the date of registration under the former part;

(e) Where it holds stocks, etc. of an affiliate under subparagraph 2 (e) of Article 25 and falls under any of the following:

(i) Making an investment for purposes of management control as prescribed by Decree of the Ministry of SMEs and Startups, meeting all of the following requirements:

(ii) Where a major shareholder of the relevant venture investment company falling under any of the following acquires the stocks, etc. of a company prescribed as a subsidiary or invested company by any of the following statutes or regulations (excluding a subsidiary or invested company related to a person who exercises de facto control over key management issues of major shareholders), from among the companies under his or her control:

(f) Where it incorporates a company determined and publicly notified by the Minister of SMEs and Startups, such as an accelerator, as an affiliate;

4. Deleted. <Aug. 5, 2025>

[Title Amended on Dec. 19, 2023]

Article 34(Requirements for registration of venture investment associations) #

"Requirements prescribed by Presidential Decree in terms of the total partners' equity amount, the number of partners, the term of existence, etc." in Article 50 (2) of the Act means the following; in such cases, where all or part of the investment is made in U.S. dollars, the amount of equity shares under subparagraphs 1 and 2 shall be calculated by converting U.S. dollars into Korean won as of the date of registration of a venture investment association: <Amended on Aug. 23, 2022; Oct. 17, 2023; Aug. 5, 2025>

1. The total amount of equity shares shall be at least the amount classified as follows:

(a) Where an operating partner is an accelerator: One billion won. In such cases, if contribution is made in installments under Article 50 (6) of the Act, the first installment shall be at least 500 million won;

(b) Where an operating partner is not an accelerator: Two billion won. In such cases, if contribution is made in installments under Article 50 (6) of the Act, the first installment shall be at least one billion won;

2. A unit of equity share shall be at least one million won;

3. The number of limited liability partners shall not exceed 49 persons. In such cases, the number of limited liability partners shall be calculated using the following methods:

(a) Professional investors under Article 9 (5) of the Financial Investment Services and Capital Markets Act, who fall under Article 271-14 (2) of the Enforcement Decree of that Act (excluding a person falling under Article 10 (3) 9 of that Decree), shall be excluded from the number of limited liability partners;

(b) Where contribution made by a collective investment scheme referred to in Article 9 (18) of the Financial Investment Services and Capital Markets Act accounts for less than 10 percent in the relevant venture association, it shall be calculated as being a limited liability partner; and where such contribution takes up at least 10 percent, each contributor shall be calculated as being a partner; provided, where contribution by a private venture fund of funds referred to in Article 80 (1) 5-2 of the Enforcement Decree of that Act accounts for at least 10 percent, such fund shall be calculated as being a limited liability partner;

(c) A person determined and publicly notified by the Minister of SMEs and Startups, such as the Fund of Funds, shall be excluded from the number of limited liability partners;

(d) Where a venture investment association receives a contribution worth less than 10 percent of the total amount of equity shares from another venture investment association, the contributing venture investment association shall be calculated as being a limited partner, and where it has received an investment of at least 10 percent, the contributors of the investing venture investment associations shall be calculated as being a limited partner, respectively; provided, if a private venture fund of funds contributes at least 10 percent, the private venture fund of funds shall be calculated as being a limited partner;

4. The equity interest of an operating partner shall account for at least one percent of the total amount of equity shares;

5. The term of existence shall be at least five years.

Article 35(Investment obligations of venture investment associations) #

(1) "Ratio prescribed by Presidential Decree" in Article 51 (1) 1 of the Act means 40 percent.

(2) "Ratio prescribed by Presidential Decree" in Article 51 (1) 2 of the Act means 20 percent.

(3) "Ratio prescribed by Presidential Decree" in Article 51 (4) 1 of the Act means 20 percent.

(4) "Ratio prescribed by Presidential Decree" in Article 51 (4) 2 of the Act means 20 percent.

(5) The investment ratio of a venture investment association under Article 51 of the Act shall be calculated in accordance with the following standards: <Amended on Oct. 17, 2023; Dec. 19, 2023; Aug. 5, 2025>

1. Article 24 (2) 1 and 2 shall apply mutatis mutandis to the detailed standards and methods for calculating the investment ratio. In such cases, "venture investment company" shall be construed as "venture investment association";

2. The amount of mandatory investment by a special-purpose company determined and publicly notified by the Minister of SMEs and Startups shall be included in the calculation of the investment ratio;

3. Notwithstanding subparagraph 1, any of the following contributions by a venture investment association shall be excluded from the calculation of the investment ratio:

(a) Contribution by a venture investment association with less than three years of history;

(b) Contribution by a venture investment association under paragraph (7);

(c) Contribution by a venture investment association whose investment ratio is separately determined under Article 70 (5) of the Act;

(d) Contribution by a private venture fund of funds which is operated by the same operating partner as the operating partner of the venture investment association;

4. In calculating the ratio referred to in paragraph (3), the amount of contribution by a private venture fund of funds which is operated by the same operating partner as the operating partner of the venture investment association shall be excluded;

5. Where there is any increase or decrease in the sum of contributions under management by a venture investment association, the investment ratio shall be calculated according to the following classification:

(a) In the case of an increase: The investment ratio for the increase shall be calculated by year as of the date of such increase;

(b) In the case of a decrease: The investment ratio shall be calculated based on the amount of contribution after such decrease;

6. The investment ratio of a venture investment association to be liquidated or dissolved within three years from its registration shall be calculated based on the date of such liquidation or dissolution;

7. Where a venture investment association acquires stocks of a special-purpose acquisition company referred to in Article 6 (4) 14 of the Enforcement Decree of the Financial Investment Services and Capital Markets Act, the investment ratio shall be calculated, under Article 51 (4) of the Act, after excluding it from the investments in a corporation listed on the securities market determined and publicly notified by the Minister of SMEs and Startups.

(6) Notwithstanding paragraph (4), a venture investment association organized for the purpose of acquisition of or merger with a small and medium enterprise or a venture business pursuant to the proviso to Article 51 (4) of the Act may invest an amount not exceeding 60 percent of the contribution to a corporation listed on the securities market in accordance with the investment ratio determined and publicly notified by the Minister of SMEs and Startups. <Added on Dec. 19, 2023>

(7) "A venture investment association prescribed by Presidential Decree, such as a venture investment association which takes over or merges with small and medium enterprises or venture businesses, or purchases stocks, etc. owned by other venture investment associations, etc." in Article 51 (6) of the Act means a venture investment association organized for the purpose of investing at least 60 percent (in cases falling under subparagraph (1), it shall be calculated to include the amount of credit granted for supplying necessary funds to an enterprise subject to merger and acquisition prior to such merger and acquisition) of the investment of the relevant venture investment association in any of the following: <Added on Dec. 19, 2023; Aug. 5, 2025>

1. Acquisition of or merger with a small or medium enterprise or a venture business;

2. Acquisition of stocks, unsecured convertible bonds, unsecured exchangeable bonds, and unsecured bonds with warrant issued by a small or medium enterprise or by a venture business;

2-2. Acquisition of equity shares held by a limited company or a limited liability company that is a small or medium enterprise or a venture business;

2-3. Undertaking of a simple agreement for future equity or a convertible note agreement concluded with a small or medium enterprise or a venture business;

2-4. Acquisition of equity shares in a project developed and produced by a small or medium enterprise and operated in a manner that maintains accounting independence from other projects;

3. Acquisition of equity interests held by members of another venture investment association or members of a new technology venture business investment association under subparagraph 14-5 of Article 2 of the Specialized Credit Finance Business Act;

4. Acquisition of shares or equity interests held by another venture investment association;

5. Investment in individual investment associations and other venture investment associations.

(8) Notwithstanding paragraph (2), the mandatory investment ratio that a venture investment association under paragraph (7) shall use for the business activities specified in Article 37 (1) 1 through 3, 6, and 7 of the Act shall be 0 percent. <Added on Dec. 19, 2023>

Article 36(Restrictions on acts of operating partners of venture investment associations) #

"Acts prescribed by Presidential Decree" in Article 52 (2) 5 of the Act means any of the following: <Amended on Oct. 21, 2021; Aug. 23, 2022; Dec. 19, 2023; Aug. 5, 2025>

1. Making an investment in any of the types of business falling under any subparagraph of Article 2;

2. Acquiring or holding the stocks, etc. of any of the following persons:

(a) Financial companies, etc.; provided, any of the following financial companies, etc. shall be excluded herefrom:

(ii) A venture investment association;

(b) An institutional private equity fund for improving corporate structure;

(d) A general private equity fund;

3. Selling assets held by an association to any of the following persons or purchasing stocks, etc. issued or held by any of the following persons with the property of the association:

(a) The relevant operating partner;

(b) An executive officer or employee of the relevant operating partner and his or her spouse;

(d) An affiliate of the relevant operating partner; provided, any of the following shall be excluded herefrom:

(i) A company invested by a venture investment association operated by the relevant operating partner;

(ii) Other corporations or organizations, such as a special-purpose company, determined and publicly notified by the Minister of SMEs and Startups, as being unlikely to pose a threat to the interests of the venture investment association and its partners and to the sound transaction order;

(e) A major partner of the relevant venture investment association and its affiliate;

(f) An association or collective investment scheme falling under any of the following, for which the relevant operating partner serves as an operating partner or general partner:

(i) An Individual investment association;

(ii) A venture investment association;

(iii) An institutional private equity fund for improving corporate structure;

(iv) An institutional private equity fund;

(v) A general private equity fund;

(vi) A new technology venture investment association;

(g) A company engaged in the cultural industry, in which a person falling under any of items (a) through (f) has invested;

4. Extending credit to a person who falls under any item of subparagraph 3; provided, this shall not apply to credit extension made for purposes of exercising security rights;

5. Acquiring stocks in the name of an individual investment association or acting as a broker for funding for a third party;

7. Making investments on conditions other than those prescribed in an investment contract;

7-2. Investing in a special-purpose company without obtaining prior consent for at least 2/3 of the total equity interests of the association;

Article 37(Exceptions to restrictions on acts by operating partners of venture investment associations) #

"Cases prescribed by Presidential Decree" in the proviso, with the exception of the subparagraphs, of Article 52 (2) of the Act means any of the following cases: <Amended on Aug. 23, 2022; Mar. 4, 2025; Aug. 5, 2025>

1. Where an operating partner conducts an act provided in Article 52 (2) 3 of the Act and falls under the following cases:

(a) Where an enterprise, which has issued stocks, etc. held by a venture investment association, belongs to a business group subject to limitations on cross shareholding (excluding where an operating partner of the venture investment association and the enterprise which has issued the stocks, etc. become belonging to the same business group subject to limitations on cross shareholding);

(b) Where an enterprise, which has issued stocks, etc. held by a venture investment association, exchanges stocks with, transfers stocks to, or merges with a company belonging to a business group subject to limitations on cross shareholding (excluding where an operating partner of the venture investment association becomes belonging to the same business group subject to cross shareholding as the enterprise which has issued such stocks, et., the company that has exchanged or transferred stocks, or the company that survives or is newly established after the merger);

(c) Where an investment is made in any of the projects recognized and publicly notified by the Minister of SMEs and Startups, such as a cultural content project, via a company engaged in the cultural industry belonging to a business group subject to limitations on cross shareholding (excluding where an operating partner of a venture investment association belonging to a business group subject to limitations on cross shareholding makes an investment by means of acquiring or holding the stocks, etc. of the company engaged in the cultural industry belonging to the same business group subject to limitations on cross shareholding with the property of the venture investment association);

2. Where an operating partner conducts an act prescribed in subparagraph 3 or 4 of Article 36 and falls under any of the following cases:

(a) Where a prior consent of all partners is obtained;

(b) Where any unavoidable circumstances exist as recognized by the Minister of SMEs and Startups, such as the dissolution of a venture investment association or recovery of investment equity interests that cannot be sold to a third party;

(c) Where a major partner of a venture investment association organized by the relevant operating partner falls under any of the following cases and where a company affiliated with the major partner (limited to a person prescribed by the following statutes as a subsidiary or invested company (excluding subsidiaries or investment companies affiliated with a person who exercises de facto control over key management issues of major contributors) is a counterpart to such act:

(i) A technology holding company prescribed in Article 21-3 of the Technology Transfer and Commercialization Promotion Act;

(ii) A technology holding company prescribed in Article 36-2 of the Industrial Education Enhancement and Industry-Academia-Research Cooperation Promotion Act;

(iii) A company specializing in the start-up of new technology-based businesses;

(d) Where the relevant venture investment association sells its investment equity interests in a company to a person falling under subparagraph 3 (d) or (e) of Article 36; provided, this shall not apply where such investment equity interests are sold under terms and conditions unfavorable to the relevant venture investment association, such as selling the investment equity interests at a price lower than the normal price (referring to the price applied or deemed to be applied in ordinary transactions);

3. Deleted; <Aug. 5, 2025>

4. Other cases determined and publicly notified by the Minister of SMEs and Startups.

Article 41(Requirements for registration of publicly placed venture investment associations) #

(1) An association to be registered as a publicly placed venture investment association under the latter part of Article 63 (2) of the Act shall meet the following requirements:

1. The total amount of equity shares shall be at least 20 billion won;

2. A unit of equity share shall be at least one million won;

3. The equity interest of an operating partner shall account for at least five percent of the total amount of paid-in equity shares;

4. The term of existence shall be at least five years.

(2) A person eligible as an operating partner of a publicly placed venture investment association under the latter part of Article 63 (2) of the Act shall be a venture investment company which meets all of the following requirements: <Amended on Aug. 9, 2022; Dec. 19, 2023>

1. Its paid-in capital shall be at least four billion won;

2. It shall retain at least five professionals falling under any item of Article 23 (7) 1. In such cases, at least one professional falling under each of the following shall be included:

(a) A person with at least three years of experience in investment-related businesses at an institution recognized by the Ministry of SMEs and Startups, such as a venture investment company;

(b) A person who satisfies all of the following requirements:

(ii) The person shall have completed training courses for professionals of venture investment companies recognized by the Minister of SMEs and Startups;

3. The person shall satisfy the standards publicly notified by the Minister of SMEs and Startups, in terms of electronic systems, means of telecommunications, business spaces, office equipment, and other ancillary equipment to ensure business continuity.

Article 41-2(Requirements for registration of private venture fund of funds) #

(1) "The amount prescribed by Presidential Decree" in the former part, with the exception of the subparagraphs, of Article 63-2 (1) of the Act means 50 billion won. In such cases, if the amount of investment is to be made in installments pursuant to Article 50 (6) of the Act, the first installment shall be at least 10 billion won. <Amended on Aug. 5, 2025>

(2) "Requirements prescribed by Presidential Decree" in Article 63-2 (1) 3 of the Act means the following requirements:

1. The paid-in capital shall be at least two billion won;

2. To have at least two full-time professionals who fall under any of the items of Article 23 (7) 1.

(3) "Requirements prescribed by Presidential Decree in terms of the scope of partners, the term of existence, etc." in Article 63-2 (2) of the Act means the following requirements:

1. A unit of equity share in contribution shall be at least one million won;

2. The number of limited liability partners shall not exceed 49 persons. In such cases, the number of limited liability partners shall be calculated using the following methods:

(b) Where contribution made by a collective investment scheme under Article 9 (18) of the Financial Investment Services and Capital Markets Act accounts for less than 10 percent in the relevant private indirect venture investment association, it shall be calculated as being a limited liability partner; and where such contribution takes up at least 10 percent, each contributor shall be calculated as being a partner; provided, where contribution by a private venture fund of funds referred to in Article 80 (1) 5-2 of the Enforcement Decree of that Act accounts for at least 10 percent, such fund shall be calculated as being a limited liability partner;

(c) A person determined and publicly notified by the Minister of SMEs and Startups, such as the Fund of Funds, shall be excluded from the number of limited liability partners;

(d) Where a private venture fund of funds receives contribution worth less than 10 percent of the total amount of equity shares from another venture investment association, the investing venture investment association shall be calculated as being a limited partner, and where it has received contribution of at least 10 percent, the partners of the investing venture investment associations shall be calculated as being a limited partner, respectively;

3. The equity interest of an operating partner shall account for at least one percent of the total amount of equity shares;

4. The term of existence shall be at least five years.

[This Article Added on Oct. 17, 2023]

Article 47(Reporting and inspection) #

(1) A person falling under any subparagraph of Article 72 (1) of the Act shall report to the Minister of SMEs and Startups on the status of business operations and others in accordance with the following classification: <Amended on Dec. 19, 2023>

1. A person falling under Article 72 (1) 1 or 2 of the Act: Reporting on a semi-annual basis;

2. A person falling under Article 72 (1) 3 through 5 or 7 of the Act: Monthly reporting; provided, where a person referred to in Article 72 (1) 5 of the Act invests in another venture investment association or special-purpose company, the following shall apply:

(a) Where investing in another venture investment association: The investment amount, investment period, etc. shall be separately reported on in accordance with the procedures and methods determined and publicly notified by the Minister of SMEs and Startups;

(b) Where investing in a special-purpose company: Reporting shall include matters regarding business operations of the special-purpose company.

(2) "Books of accounts, documents, etc. prescribed by Presidential Decree, including auditor’s reports" in the provisions, with the exception of the subparagraphs, of Article 72 (2) of the Act means the following: <Amended on Aug. 23, 2022>

1. An auditor’s report;

2. A certified copy of the corporate register;

3. Documents evidencing professionals the person has secured and their qualifications;

4. Documents on the status of offices secured.

5. A register of shareholders;

6. A list of partners of a private investment association, venture investment association, or Fund of Funds;

7. Documents on the list of partners and their respective investment ratios, where the partners of an association referred to in subparagraph 6 are diverse, such as a collective investment scheme or a prescribed money trust referred to in subparagraph 1 of Article 103 of the Enforcement Decree of the Financial Investment Services and Capital Markets Act;

8. A contract on the transaction;

9. A general ledger (referring to an accounting book detailing all accounts in corporate accounting);

10. A register of shareholders of the company, which is a contractual party, and a certified copy of the corporate register;

11. Documents verifying relevance to an operating partner;

12. Documents verifying that an operating partner is a representative director or major shareholder of an enterprise.

(3) "Cases prescribed by Presidential Decree" in Article 72 (2) 7 of the Act means any of the following cases: <Amended on Oct. 17, 2023; Dec. 19, 2023>

1. Where it is necessary to ascertain whether there is any registered change in important matters regarding professional individual investors under the latter part of Article 9 (1) of the Act;

2. Where it is necessary to ascertain whether there is any registered change in important matters regarding an individual investment association under the latter part, with the exception of the subparagraphs, of Article 12 (1) of the Act;

3. Where it is necessary to ascertain whether there is any registered change in important matters regarding an accelerator under the latter part, with the exception of the subparagraphs, of Article 24 (1) of the Act;

4. Where it is necessary to ascertain whether any modification to an important matter of a venture investment company has been registered under the latter part, with the exception of the subparagraphs, of Article 37 (1) of the Act;

5. When it is necessary to confirm whether to register a change in an important matter in a venture investment association pursuant to the latter part, with the exception of the subparagraphs, of Article 50 (1) of the Act or the latter part, with the exception of the subparagraphs, of Article 63-2 (1) of the Act.

Article 48(Delegation of authority and entrustment of affairs) #

(1) Pursuant to Article 76 (1) of the Act, the Minister of SMEs and Startups shall delegate the following authority to the head of a regional SMEs and Startups office: <Added on Aug. 23, 2022; Apr. 4, 2023; Oct. 17, 2023>

1. The registration, and the registration of change, of professional individual investors under Article 9 of the Act;

2. The registration, and the registration of change, of individual investment associations under Article 12 of the Act;

3. Receipt of reports on the results of liquidation of individual investment associations and cancellation of registration thereof under Article 19 of the Act;

4. The registration of, or registration of change in, venture investment associations under Article 50 or 63-2 of the Act;

5. The issuance of investment confirmations to individuals or individual investment associations and requests for submission of data verifying the investment performance under Article 45.

(2) Pursuant to Article 76 (2) of the Act, the Ministry of SMEs and Startups shall entrust the Korea Venture Investment Corporation with the following affairs: <Amended on Aug. 23, 2022; Oct. 17, 2023; Dec. 19, 2023>

1. Deleted; <Aug. 23, 2022>

2. Management of the data on registration of professional individual investors, individual investment associations, accelerators, venture investment companies, and venture investment associations and registration for changes under Articles 9, 12 (1), 24 (1), 37 (1), 50 (1), and 63-2 (1) of the Act;

3. Management of the data on administrative dispositions such as the revocation of registration of professional individual investors, individual investment associations, accelerators, venture investment companies, and venture investment associations under Articles 11, 22, 36 (1), 49 (1), and 62 (1) of the Act;

4. Management of the data on an annual report submitted by individual investment associations, venture investment companies, and venture investment associations under Articles 16, 31, 44, and 54 of the Act

5. Management of the data on dissolution or liquidation of individual investment associations and venture investment associations under Articles 18, 19, 56, and 57 of the Act;

6. Management of the data on professionals and facilities under Articles 24 (2) 4, 37 (2) 4, 50 (1) 5 and 6, and 63-2 (1) 3 of the Act;

7. Management of the data on succession to the status of an accelerator and a venture investment company under Articles 33, 35, 46, and 48 of the Act;

8. Management of the data on disciplinary action against executive officers, employees, or operating partners of accelerators, venture investment companies, and venture investment associations under Articles 36 (2), 49 (2), 62 (2) through (4) of the Act;

9. Affairs regarding surveys on the management status of venture investment companies under Article 41 (2) of the Act;

10. Management of data for reporting on venture debt financing under Article 70-2 (3) of the Act;

11. Management of the data on investment performance reporting under Article 72 (1) (excluding subparagraph 6) of the Act;

12. Management of the data on hearings under Article 75 of the Act;

13. Preservation and management of the data on the duties listed in the subparagraphs of paragraph (4).

(3) The Minister of SMEs and Startups shall entrust the Korea Institute of Startup and Entrepreneurship Development referred to in Article 51 of the Support for Small and Medium Enterprise Establishment Act with the following duties, under Article 76 (2) of the Act: <Amended on Jun. 28, 2022; Aug. 23, 2022>

1. Receipt and confirmation of the registration of accelerators or registration for changes under Article 24 (1) of the Act;

2. Affairs relating to specialized incubation services by accelerators and promotion of investment under Articles 25 and 26 of the Act;

3. Affairs relating to surveys on management status of accelerators under Article 29 (2) of the Act;

4. Receipt and confirmation of an annual report submitted by accelerators under Article 31 of the Act;

5. Operation of public disclosure by accelerators under Article 32 (1) of the Act;

6. Receipt and confirmation of a report on investment performance and business operation status of accelerators under Article 72 (1) of the Act.

(4) Pursuant to Article 76 (2) of the Act, the Ministry of SMEs and Startups shall entrust the Korea Venture Capital Association with the following affairs: <Amended on Aug. 23, 2022; Oct. 17, 2023; Dec. 19, 2023>

1. Analysis of domestic and international venture investment trends, support for enhancing the performance of venture investment, training of professionals in venture investment, and expansion of international exchange under Article 5 (2) through (5) of the Act;

2. Operation and management of the integrated management system under Article 7 of the Act;

3. Confirmation of whether the requirements for professionals of venture investment companies under Article 37 (2) 4 of the Act are satisfied and management of such professionals;

4. Receipt and confirmation of an annual report submitted by venture investment companies and venture investment associations under Articles 44 and 54 of the Act;

5. Operation of public disclosure by venture investment companies under Article 45 of the Act;

6. Receipt and confirmation of the registration of venture investment associations and registration for changes under Articles 50 and 63-2 of the Act;

7. Receipt and confirmation of a report on dissolution and liquidation of a venture investment association under Articles 56 and 57 of the Act;

8. Receipt and confirmation of a report on investment performance and business operation status of venture investment companies and venture investment associations under Article 72 (1) of the Act.

(5) The Minister of SMEs and Startups shall entrust the Korea Business Angels Association with the following duties under Article 76 (2) of the Act: <Amended on Aug. 23, 2022>

1. Promotion of projects for boosting investment by individuals under Article 8 of the Act;

2. Receipt and confirmation of the registration of professional individual investors and registration for changes under Articles 9 and 11 of the Act;

3. Receipt and confirmation of the registration of individual investment associations, registration for changes, and an annual report under Articles 12 and 16, and duties relating to dissolution and liquidation under Articles 18 and 19;

4. Receipt and confirmation of a report on investment performance by professional individual investors and individual investment associations under Article 72 (1) of the Act;

5. Assistance in the issuance of written investment confirmations under Article 45.

(6) Where necessary, the Minister of SMEs and Startups may request a person entrusted with the duties under paragraphs (2) through (5) to submit the data thereon. <Amended on Aug. 23, 2022>

[Title Amended on Aug. 23, 2022]

Article 50(Re-examination of regulation) #

The Minister of SMEs and Startups shall examine the appropriateness of the following matters every three years, counting from the base date of August 12, 2020 (referring to the period that ends on the day before the base date of every third year) and shall take such measures as making improvements: <Amended on Dec. 19, 2023>

1. Requirements for the registration of professional individual investors under Article 4;

2. Requirements for the registration of investment companies for the establishment of small and medium enterprises under Article 6;

3. Investment ratio of individual investment associations under Article 7;

4. Restrictions on acts of operating partners of individual investment associations under Article 8;

5. Requirements for the registration of accelerators under Article 13;

6. Investment ratio of an accelerator and standards for the calculation thereof under Article 15;

7. Restrictions on acts of accelerators under Article 16;

8. Scope of large shareholders and related persons of accelerators under Article 18;

9. Restrictions on acts of large shareholders of accelerators under Article 19;

10. Standards for accelerators’ sound management under Article 20;

11. Major shareholders not allowed to use information on accelerators’ duties under Article 21;

12. Registration requirements for venture investment companies under Article 23;

13. Investment ratio of venture investment companies and standards for calculation thereof under Article 24;

14. Restrictions on acts of venture investment companies under Article 25;

15. Restrictions on acts of large shareholders of venture investment companies under Article 28;

16. Exceptions to revocation of registration of venture investment companies under Article 32;

17. Requirements for the registration of venture investment associations under Article 34;

18. Investment ratio of venture investment associations and standards for calculation thereof under Article 35;

19. Restrictions on acts of operating partners of venture investment associations under Article 36;

20. Requirements for the registration of publicly placed venture investment associations under Article 41.

ENFORCEMENT DECREE OF THE VENTURE INVESTMENT PROMOTION ACT

Article 1(Purpose) #

Article 2(Scope of application) #

Article 3(Fact-finding survey) #

Article 4(Requirements for registration of professional individual investors) #

Article 5(Calculation of amount of investment by professional individual investors) #

Article 6(Organization and registration of individual investment associations) #

Article 7(Individual investment associations’ obligation to invest) #

Article 8(Restrictions on Acts by operating partners of individual investment associations) #

Article 9(Exceptions to restrictions on Acts by operating partners of individual investment associations) #

Article 10(Annual reporting by individual investment associations) #

Article 11(Dissolution of individual investment associations) #

Article 12(Appropriation of profit of individual investment associations) #

Article 12-2(Disclosure by Individual Investment Associations) #

Article 13(Requirements for registration of accelerators) #

Article 14(Methods for selecting early stage startups by accelerators) #

Article 15(Accelerators’ obligation to invest) #

Article 16(Restrictions on acts of accelerators) #

Article 17(Exceptions to restrictions on acts of accelerators) #

Article 18(Scope of large shareholders and related persons of accelerators) #

Article 19(Restrictions on acts of large shareholders of accelerator) #

Article 20(Standards for accelerators’ sound management) #

Article 21(Major shareholders not allowed to use information on accelerator’s duties) #

Article 22(Annual reporting by accelerators) #

Article 22-2(Public disclosure by accelerators) #

Article 23(Requirements for registration of venture investment companies) #

Article 24(Investment obligations of venture investment companies) #

Article 25(Restrictions on acts of venture investment companies) #

Article 26(Exceptions to restrictions on acts of venture investment companies) #

Article 27(Scope of persons related to large shareholders of venture investment companies) #

Article 28(Restrictions on acts of large shareholders of venture investment companies) #

Article 29(Standards for management soundness of venture investment companies) #

Article 30(Major shareholders prohibited from using information on businesses of venture investment companies) #

Article 31(Annual reporting by venture investment companies) #

Article 32(Exceptions to revocation of registration of venture investment companies) #

Article 33(Requirements for limited companies or limited liability companies to organize venture investment association) #

Article 34(Requirements for registration of venture investment associations) #

Article 35(Investment obligations of venture investment associations) #

Article 35-2(Special-purpose companies of venture investment associations) #

Article 36(Restrictions on acts of operating partners of venture investment associations) #

Article 37(Exceptions to restrictions on acts by operating partners of venture investment associations) #

Article 38(Annual reporting by venture investment associations) #

Article 39(Dissolution of venture investment associations) #

Article 40(Appropriation of profit of venture investment associations) #

Article 41(Requirements for registration of publicly placed venture investment associations) #

Article 41-2(Requirements for registration of private venture fund of funds) #

Article 41-3(Special cases concerning investment ratio and restrictions on acts of private venture fund of funds) #

Article 42(Business activities of Korea Venture Investment Corporation) #

Article 43(Guidance and supervision over business operations of Korea Venture Investment Corporation) #

Article 44(Organization of fund of funds for venture investment) #

Article 44-2(Venture debt contract) #

Article 45(Issuance of investment confirmations) #

Article 46(Contribution of fund to venture investment associations) #

Article 47(Reporting and inspection) #

Article 48(Delegation of authority and entrustment of affairs) #

Article 49(Processing of sensitive information and personally identifiable information) #

Article 50(Re-examination of regulation) #

Article 51(Criteria for imposing administrative fines) #