TVXQ, boy band of SM Entertainment / Korea Times file



By Kim Jae-heun

SM, YG and JYP, Korea's three major entertainment agencies, may become illegitimate agencies unless they are registered with the government by July 28.

According to the Popular Culture Industry Act by the Ministry of Culture Sports and Tourism, which will go into full effect next month, entertainment agencies must obtain a government-approved certificate in order to continue their business as a legal entity. It states that already existing entertainment agencies before the act was established on July 29, 2014, must register by June 19, whereas newly established agencies after that date must complete registration by July 28. The newly launched agencies must prove four years of experience in the field and ownership of an independent office.

The Popular Culture Industry Act was established by the ministry to prevent unfair contracts between the agency and entertainers and to secure education rights for young entertainers who are often deprived of their time at school.

"Entertainment agencies seem to be avoiding the responsibilities that will immediately follow once they are registered," said Kang Min-ju, a lawyer at Hankug Law Firm, who participated in establishing a standard form contract for the cinematographers' union. "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."

TVXQ, a former popular boy band with SM in the 2000s, signed a 13-year contract with the agency. Two Chinese members from SM's new boy band EXO already withdrew from the group voicing their dissatisfaction with the contract.

"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," said Kang.

Korea Creative Content Agency (KOCCA), which is in charge of issuing the career certificates, has been raising awareness of the law since last year. The organization published articles, aired advertisements and held meetings with major agencies in February and March.

"We have called every agency we could find online and reminded them of their duty to register by law," said an official at KOCCA. "If the three major agencies are not registered by next month, they will be considered as an illegitimate business."

Other entertainment agencies or record labels such as Cube Entertainment, KeyEast and FNC have completed their registration.

"We don't know why and it's impossible to find out the reasons behind the three agencies' (SM, YG and JYP) 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," KOCCA officials said.