Two Amendments Passed Together at the September 22 Cabinet Meeting
On September 22, 2026, the Ministry of SMEs and Startups obtained Cabinet approval for two bills at once: a promulgation bill amending the Framework Act on Small and Medium Enterprises and an amendment to the Act on Facilitation of Purchase of Small and Medium Enterprise-Manufactured Products and Support for Development of Their Markets (the Market Support Act). They change different things. The first changes who counts as an SME. The second changes how much of public procurement is reserved for SMEs.
This matters to existing SMEs too. A wider local priority procurement band gives them more procurement opportunities right away. The two changes take effect at different times, though:
Community Enterprises, Self-Sufficiency Enterprises and Medical Corporations Become SMEs
Community enterprises (maeul) and self-sufficiency enterprises are social solidarity economy organizations that create social value, but they have not been recognized as SMEs. Medical corporations were excluded because the Medical Service Act classifies them as non-profit.
This created a fairness problem. Individually owned clinics and hospitals, along with some non-profit medical institutions set up by consumer cooperatives and social cooperatives, were already recognized as SMEs. Two providers offering the same medical services could be treated differently just because of their legal form.
Once included, these organizations can use SME support programs such as policy loans, R&D funding, and market access and export support. However, inclusion applies only to organizations that "meet the requirements set by Presidential Decree." Size, revenue structure and other criteria will be set in subordinate regulations. Eligible organizations can prepare now by:
Local Priority Procurement: Why the Threshold Rose from KRW 230 Million to KRW 350 Million
The old system was inconsistent. Local governments and local public enterprises follow the Local Contract Act, yet the notified threshold for SME priority procurement followed the National Contract Act. That meant a lower threshold than the one in the Local Contract Act applied to them, which narrowed the range of contracts open to SMEs.
The amendment sets thresholds according to the contract law that governs each institution, in line with the local-government schedule of the WTO Government Procurement Agreement. For institutions under the Local Contract Act, the threshold rises from up to KRW 230 million to KRW 350 million.
In practice, projects worth KRW 230–350 million, which used to go to open competition, now fall within SME priority procurement. But priority procurement widens eligibility; it does not guarantee contracts. The effect will be strongest in sectors that rely heavily on local-government and local public enterprise orders, such as equipment, construction materials, information systems and services.
Three Procurement Tasks to Complete Before December
1. Check that eligibility documents are still valid
SME confirmation certificates and direct production certificates have validity periods. An expired SME confirmation certificate keeps you out of priority procurement bids altogether, and a direct production certificate is required for competitive products reserved for SMEs — so if you supply such items, check your renewal dates now.
2. Set up order monitoring
Create search filters on KONEPS (Korea's national e-procurement system) and in local-government procurement plans that isolate orders of KRW 350 million or less.
3. Combine with priority purchasing of technology products
Pair priority purchasing credentials such as Performance Certification, NEP (New Excellent Product) and NET (New Excellent Technology) with the wider procurement band to reach a much larger share of the public market.
Procurement track records can then support the revenue figures in your policy loan and R&D business plans. Contracts help you win support programs, and those program results in turn make you more competitive in procurement.
KITIM's Approach: Linking Eligibility, Procurement and Support Programs
For newly eligible community enterprises, self-sufficiency enterprises and medical corporations, KITIM assesses SME eligibility and matches you with suitable support programs. For existing SMEs, we design a public procurement roadmap that runs from preparing eligibility documents to finding orders in the priority band and improving the quality of your bid documents.
If you want to check where you stand before the December change, try KITIM's free business diagnosis. It reviews the support programs and procurement credentials available to you in one step, and you can also request a consultation with our experts through the Contact page.