SM, YG, and JYP Ent. Have Yet to Register With Government

[sayuridoll.livejournal.com]

The Ministry of Culture Sports and Tourism‘s Popular Culture Industry Act is set to be enforced in full next month with entertainment agencies required to register with the government, but the Big 3 have yet to do so.

According to the new act established last year on July 29th, in order for agencies in South Korea to be legitimately be recognized as a legal business, they must be registered with the government by June 19th. With neither SM, YG or JYP Entertainment registered with the government yet, they are facing the danger of becoming an illegitimate agency in the eyes of the government.

Cube Entertainment, KEYEAST, and even FNC Entertainment have been confirmed to have already completed registering with the government.

The Pop Culture Industry Act was passed last year in attempts to prevent unfair contracts, dubbed as “slave contracts,” between an agency and the entertainer. Furthermore, it also helps to secure the rights of young entertainers who may be deprived of their education due to their schedule.

But why are these agencies delaying their registration?

A lawyer from Hankug Law Firm, Kang Min Ju, commented, “Entertainment agencies seem to be avoiding the responsibilities that will immediately follow once they are registered. For example, when the agency is registered as an official entertainment business by the government, it has to follow the FTC’s rigorous standard contract form – which restricts the maximum contract period to seven years.”

“Contract breach is another issue. When an entertainer cancels a contract in the middle of the term, registered agencies can no longer charge double or triple what they are suppose to ask for.”

The Korean Creative Content Agency (KOCCA) has been publicizing the new law since its inception last year, writing several articles, airing advertisements, and even holding meetings with major agencies in February and March, thus making the chances very slim that the Big 3 are unaware of the law.

An official at KOCCA stated they have contacted nearly every agency that they could find online to remind them to register per the law, and continued to add that, “If the three major agencies are not registered by next month, they will be considered as an illegitimate business.”

“We don’t know why and it’s impossible to find out the reasons behind the three agencies’ late registration despite a year grace period. For SM and YG, if they don’t certify their business by this Friday, they will have to register as a newly established entertainment, which will be another month of delay.”
Newly established agencies, who must provide proof of at least four years of experience in the field and in the office, must register by July 28th.

Source: Koreaboo

Comments

[hearttaek.livejournal.com]

Ohhh those three agencies, nagl

I wonder if jelpi is registered. I'm inclined to believe my bbs are in good hands anyway. Sung Sikyung divides income with jelpi at 80:20 ratio. And jelpi has been very supportive with hyoshin's lawsuits/debt. If only the previous company would let hyoshin work in peace now, maybe we would be able to see him on tv. I wonder if the delay of his album release is because his previous company keeps meddling and they want to wait until he's completely in the clear before he releases it. Gosh that album was supposed to be released two years ago.

[tsuyoi-hikari.livejournal.com]

Why Park Hyo Shin breached the contract with his previous company? I always wondered why he do that.

[kanbinayume.livejournal.com]

not op but they mistreated him, forced him to work over his limit, and charged him for an event he missed because he was sent to the hospital, among other things

[tsuyoi-hikari.livejournal.com]

Thank you! Now I feel so much better. But the lawsuit did caused him a lot unfortunately... :(

[kanbinayume.livejournal.com]

it did, it was so much money!! and it's not over yet, he's still going to hearings for stuff related to it. at least jelpi helped him out a lot

[adlyeith.livejournal.com]

"“Contract breach is another issue. When an entertainer cancels a contract in the middle of the term, registered agencies can no longer charge double or triple what they are suppose to ask for.”"

No wonder SM hasn't registered yet, considering they have two, potentially three, lawsuits that they're currently dealing with concerning contracts. I wonder why the other two are delaying, it seems silly that YG especially is putting this off with all of BB's promotions going on and all the comebacks that are supposed to be happening yet this year.

I hope Pledis registered..

[kjc48.livejournal.com]

what they are suppose to ask for

i'm honestly interested in what the govt actually means by this. Like it's standard practice in all music industries to charge millions in penalty fees (and most industries don't invest nearly as much as kpop into potential stars). Are companies going to show how much they invested to prove that they're asking for a reasonable amount (couldn't the company simply alter the books)? Is the govt going to decide a basic pay out fee and everyone has to go along with it? Are companies no longer allowed to ask for the lost "potential" future profits (which for a company like SME who has done HOT>SHINHWA>DBSK>EXO would be a legitimate claim)?

Basically: there is going to be a huge shit storm when that EXO-K member leaves lol

[fullmoon-secret.livejournal.com]

can't pull the receipts right now but supposedly the penalty fees is outrageous. I remember for dbsk, penalty fee is projected earning for the rest of the contract term time 3. So in 2009, dbsk was making roughly 100 million USD, time that to 3 so they need to pay hundreds of millions. While each member each make around 160k(?) for the 5 years they worked as dbsk.

[kjc48.livejournal.com]

I didn't say the fees weren't ridiculous, I just pointed put that it's a global practice for record label penalty fees to be crazy.

Also: If a product (and that's all idols are to their labels) is bringing in 100mil a year asking for 300mils, when the product could possibly bring in a billion over the remainder of their contract (I don't remember for sure but I think DBSK had only completed a third of their contract length back then), isn't actually that unreasonable. Especial since DB2K and JYJ have each gone on to continue to bring in that much money (double since it's now 2 groups).

That's capitalism, it's fucked up but it's also how our society works.

[4minutesluts.livejournal.com]

i think most of the ppl leaving pledis are at the end of their contracts

[ohcrepe.livejournal.com]

Exactly my question the whole time I was reading this

[xxyumekaxx.livejournal.com]

I'm pretty sure they were registered before or else lawyers would've sued them. Always a good day for these sharks to sue companies, even better if they have lots of $$$

[cinnabun11.livejournal.com]

what's the implication of being an "illegitimate business"?

[kjc48.livejournal.com]

Knowing Korea: in 2 months veteran singers (who actually have decent contracts) will start bitching about the fact that they have the same contract as rookies.

Instead of doing all of this (which is good in theory), the government should focus on getting entertainers PAID. From idols to comedians to junior scriptwriters, at all times half of the entertainment industry is working for free. Most idol appearances on variety shows doesn't even cover the cost of the makeup and clothing they are wearing. Month after month an idol talks about having $0.005 in their bank account.

Also: since Keyeast is their I assume this includes acting and modeling agencies. I'll be more interested in seeing how they change with the new law.

[sra-interesante.livejournal.com]

true, when you hear stories like tahiti girls .... you kinda wonder if they're working for free

[mycorrhizoid.livejournal.com]

For example, when the agency is registered as an official entertainment business by the government, it has to follow the FTC’s rigorous standard contract form – which restricts the maximum contract period to seven years.”

I really want to see what happens when SM implements this. I have this feeling it's going to be a mass exodus of all the older artists that they keep in the dungeon - Trax, CSJH, Zhang Liyin, Kibum, Isak, J-min etc. I don't believe they're still with SM because they love it so much.

*Didn't realize Isak had left.

[velveteenkitten.livejournal.com]

Justice for TRAX!

[leighbee333.livejournal.com]

*Didn't realize Isak had left.

Yeah, I just found that out as well (don't know the specifics tho)

I'm glad she finally got out, but that was a good portion of her life SM monopolized

[froggster.livejournal.com]

But why jype? Weren't the contract guidelines based on their contracts??

[velveteenkitten.livejournal.com]

No wonder they haven't signed up with the restriction on contract lengths. I would LOVE to see that happen, but I bet they wouldn't.

Also SM could be in shit with the whole breach of contract lawsuits going on at the moment.

I really want to know what the penalty is that the government has set up if they are not registered by the the deadline? Is there one even?

[hipployta.livejournal.com]

Hmmmm...we know why SM hasn't but I'm curious why JYP and YG haven't

I wonder what all the additional regulations entail and if they are all organizing to match up first

[bunica1990.livejournal.com]

Nnnnnnnn so juicy

[soo-tic.livejournal.com]

Kind of curious what the penalty is, cause if its just money then lol, SM won't care.
Have they even paid JYJ for interfering in their activities?

[sand-nicky.livejournal.com]

No, they haven't. They were supposed to pay JYJ twice now, but unsurprisingly they hadn't. What can one expect from a corrupt company like SM?

[leighbee333.livejournal.com]

Seriously?! They're legally obligated to pay JYJ, and they're just allowed to go "...nah." ???

[sand-nicky.livejournal.com]

Believe me, I'm just as baffled as you are, alas SM always finds "excuses" such as...

[On July 24, it has been reported that the Fair Trade Commission (FTC) issued a sanction against SM Entertainment and the KFPCAI for interfering with JYJ‘s broadcasting rights and promotions.]

SM's response is always:

[SM sources commented, “There is no truth in the accusation of our agency interfering with JYJ. It’s a shame that the FTC made that decision,” and “We are looking to respond legally about this matter.”]

This is from an article published in 2013. The fee of 20 million won hadn't been paid yet. And neither has the one from before too. SM doesn't respond legally to FTC either. Basically it just dies down.

[leighbee333.livejournal.com]

Sorry this response is late.

I just...can't fathom how there isn't some enforcement mechanism in a supposedly somewhat advanced democratic society. SM management must be entangled with the gov't somehow.

[sand-nicky.livejournal.com]

No worries.

Of course, the government is entagled in this. And not only the government. Just like the Japanese entertainment industry is heavily influenced by their mafia, the Korean one is exactly the same.

[sra-interesante.livejournal.com]

wow .... with the amount of money (a lot for sure) they move i wonder why authorities are so calm about their illegal situation
i guess a month sounds fair enough, i wonder if we will get to see some changes in the industry after they get legal

[aki-san.livejournal.com]

Wasn't there something about new agencies having to be created by people who already have experience in the industry (as in, they previously worked for another agency)? So that people can't just create new entertainment agencies and take in trainees as if they're opening a new cafe.

[akillarian.livejournal.com]

Yes there was that law coming out not too long before.

[modestgoddess79.livejournal.com]

could this help BAP?

[mlmello.livejournal.com]

we know how much the government uses the power of kpop to its own benefit, so I'm a little skeptical about how strict they will be with the biggest 3 agencies of the country...

let's wait and see.

[xxhna.livejournal.com]

mhm....no surprise sm hasn't registered yet -___-
idky why the other two haven't though

[phililen3.livejournal.com]

Maybe they have skeletons we don't know about? Only explanation.

[bomsnose.livejournal.com]

someone is still in the process of figuring out the right amount of bribes to stop the government looking at their contracts or something