The government is moving to expedite the operation of semiconductor factories by simultaneously advancing the approval, compensation, and design processes for industrial complexes. This initiative aims to reduce waiting times during the construction of factories, equipment repairs, and prototype testing, while also considering special working hour exemptions for key research and development (R&D) personnel within the ultra-wide special zones.
The Ministry of Trade, Industry and Energy announced these measures during the second full meeting of the Regulatory Rationalization Committee held at the Blue House on the 23rd. The 'Regulatory Rationalization Plan for Rapid Implementation of Mega Project Semiconductor Investments' was presented in collaboration with relevant government departments.
This plan focuses on parallelizing procedures that were previously sequential in the semiconductor investment process and reducing overlapping administrative procedures among departments. It recognizes that delays in any single approval can impact the overall investment schedule, as semiconductor factories require not only production facilities but also essential infrastructure such as power and water to operate.
The government plans to introduce a fast-track system for simultaneous approval, compensation, and design of semiconductor industrial complexes. A related amendment to the Industrial Location Act was proposed on July 30.
If the semiconductor cluster is designated as an ultra-wide strategic industrial special zone, the scope for processing infrastructure approvals will also be expanded. In addition to the approvals deemed necessary under the Special Semiconductor Act, further approvals will be processed collectively under the ultra-wide special zone law.
In the customs and bonded areas, the government will expand the designation of the entire industrial complex as a comprehensive bonded area to reduce the burden on companies. Currently, each fab must obtain a bonded factory license and renew it every 5 to 10 years, but designating the entire complex will alleviate this burden and facilitate the import, processing, and movement of foreign equipment and raw materials. Ninety-five percent of domestic semiconductor exports are manufactured and processed in bonded factories.
The government will also allow tax deferrals for foreign analytical equipment and measuring devices used in factory construction. Unlike foreign machinery and equipment installed in bonded construction sites, construction equipment must currently be taxed before use, creating an initial financial burden.
To minimize production disruptions due to equipment failures, the government will permit the advance storage of semiconductor manufacturing equipment repair parts produced by overseas corporations in domestic bonded factories. Excellent bonded factories located far from airports and ports will be allowed to transport pre-approved items first and file export declarations during transit if they meet certain criteria.
Redundant procedures for handling hazardous chemicals will also be streamlined. Under the Occupational Safety and Health Act, obtaining subcontracting approval will be recognized as fulfilling the subcontracting reporting requirement under the Chemical Substances Control Act.
Separate safety standards for high-pressure gases tailored to semiconductor production sites will be established. When installing multiple cylinder cabinets, technical reviews and change approvals will be processed collectively, and non-reactive gases will be allowed to be stored together.
The government is considering special working hour exemptions for key R&D personnel within the ultra-wide special zone. This initiative aims to secure research time during critical periods of technological development. Discussions will be held with labor and management representatives, ensuring appropriate compensation and protection of health rights.
Opportunities for domestic materials, parts, and equipment companies to test developed technologies in actual production environments will also be increased. A special provision will be introduced to exempt nonprofit semiconductor testbed operating entities from gift tax when they receive facilities and equipment from companies at no charge. This measure aims to encourage companies to contribute equipment and expand the practical testing base.
The procedures for inspecting and testing R&D prototypes produced in bonded factories will be simplified. Currently, prior export approval is required for each item, but excellent bonded factories with autonomous management capabilities will have reduced export and import procedures to support technology verification and new product launches.
The government plans to coordinate inter-departmental issues through the Presidential Committee on Strengthening Semiconductor Industry Competitiveness and will continuously support corporate investment implementation through the Semiconductor Innovation Growth Support Team established on the 20th. They will monitor individual company schedules from construction planning to commencement and operation, while also coordinating related issues with local governments.
The government is also pushing for the enactment of the ultra-wide special zone law to support large-scale local investments. This law will allow companies to select necessary regulatory exemptions or defer regulations based on on-site needs and provide bundled support from multiple government departments.
Minister of Trade, Industry and Energy Kim Jeong-kwan stated, "The competition in the semiconductor industry is a race against time," adding, "We will boldly improve procedures that do not fit the field while ensuring safety and workers' rights."
* This article has been translated by AI.
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