Call Overview — Local Governments Apply, Companies Benefit
In September 2026, the Ministry of SMEs and Startups opened a call to non-capital-area local governments for candidate projects to be newly designated as Regulation-Free Special Zones in 2027. Applicants are metropolitan, provincial and municipal governments outside the Seoul capital area, and zone plans must be submitted between November 2 and 6.
Companies cannot apply directly. A zone plan, however, is built around the companies that will actually run the demonstration — the "zone operators." For SMEs whose product launch or field testing is blocked by regulation, this is an opening to be written into a local government's plan.
Three Zone Types — Where Does Your Technology Fit?
The Selection Logic Behind the Evaluation Criteria
Plans are assessed on the ripple effect of the regulatory improvement, the contribution to the regional economy, and the feasibility of regulatory improvement and commercialization. For a local government to score well, the company has to supply the evidence:
How Companies Get In — What to Do One Month Before Submission
About a month remains before the deadline. Local governments are very likely already sourcing projects, so speed matters.
Because zones are designated outside the capital area, companies based there need to consider relocating a site or opening a branch inside the zone. What counts is not a paper address change but whether demonstration staff and equipment are actually based there. Be sure to confirm the exact location requirements in the official notice and with the local government concerned.
Once designated, a zone operator receives regulatory exceptions such as a demonstration exemption, and can be linked to demonstration R&D and commercialization support.
How It Differs from the Regulatory Sandbox and Regulatory-Exception R&D
Under the regulatory sandbox, an individual company applies to the responsible ministry for an exception. A Regulation-Free Special Zone is designated for a region, and several companies demonstrate together in one area. If you can test alone and speed is the priority, the sandbox fits. If you need demonstration infrastructure, local government cooperation and linked funding, the zone is the better route.
The two can also be used in sequence: secure safety data through a zone demonstration, then move on to regulatory-exception-linked R&D to improve performance and prepare for certification.
Risks and Limits
Preparation Checklist and KITIM Support
KITIM supports the whole process, from analyzing the regulatory provisions to writing the demonstration plan and local government proposal and planning follow-up R&D projects. With the submission deadline close, if you are considering joining a special zone, please request a consultation through the KITIM contact page now.