Voluntary corrective measures such as 5 companies with verbal contracts and 1 billion contributions were accepted.

Five major entertainment companies that performed services verbally without contracts to outsourcing companies have come up with win-win plans, including 1 billion won in contributions, and avoided sanctions by the Fair Trade Commission.

The Fair Trade Commission said it has decided to accept Hive, SM, YG, JYP, and Starship Entertainment after deliberating on their applications.

Consent resolution is a system in which a business operator under investigation or deliberation prepares a voluntary corrective plan and the case is closed when the FTC accepts it.

The FTC was investigating the practice of five companies contracting verbally without issuing contracts while entrusting outsourcing companies with services such as records, goods, videos, and performances, on charges of violating subcontracting laws.

The five companies proposed a win-win plan, including writing a standard contract and contributing 1 billion won in win-win cooperation funds, in April-May, before the FTC sent the review report.

This is the first case in which the consent resolution process was initiated in the manufacturing and service subcontracting sector after the consent resolution system was introduced in the subcontracting law in July 2022.