Korean lawmakers propose a law to enhance transparency in the entertainment industry and prevent tax evasion by agencies and artists.
March/3/2026 13:44Related Groups & Members
To prevent opaque operations and tax evasion by entertainment agencies, the so-called 'Cha Eun-woo Prevention Law' is being promoted in the South Korean National Assembly. Jeong Yeon-uk, a member of the People Power Party, revealed yesterday (the 1st) that he would propose the Cultural Arts Industry Development Act. He proposed an amendment that would require entertainment planning agencies to report their registration and business status to the Minister of Culture, Sports and Tourism (hereinafter referred to as the Ministry of Culture) annually. This amendment establishes a new provision that requires planning agencies to report their registration and business status to the Minister of Culture annually. It also stipulates that local governments must report the content they handle to the Ministry of Culture. Additionally, those who have received a penalty of more than a fine for violating the Tax Offenders Punishment Act are also included as disqualifying factors. The current law restricts planning activities for sex offenders and child abusers, but there are no restrictions for those punished for tax evasion. The amendment adds those who have received a penalty of more than a fine for violating the Tax Offenders Punishment Act as disqualifying factors. It also includes provisions to restrict not only the representatives of planning offices but also those working in the relevant companies. According to materials obtained by Jeong Yeon-uk from the Ministry of Culture, as of the end of last year, there were 6,140 registered popular culture and arts planning companies. The number of new registrations in 2021 was 524, but it increased to 907 last year. Jeong Yeon-uk stated, 'While K-content leads the global market, the management system of agencies remains outdated. We can no longer ignore the systemic loophole that allows those who have committed tax evasion to operate planning businesses without consequence.' He also called for direct management and supervision instead of hiding behind the excuse of leaving it to local governments, stating, 'This bill is a minimum measure to enhance the transparency and accountability of the industry and establish a fair order.' Prior to this, it was reported that Cha Eun-woo was investigated by the Seoul Regional Tax Office's Investigation Division 4 last year and was notified of tax reassessments exceeding 20 billion won (approximately 20 million USD) for income tax and other taxes. His agency, Fantagio, commented on January 22, 'This case revolves around whether the corporation established by Cha Eun-woo's mother falls under the substantial tax subject, and it is not a finalized case that has been confirmed and announced. We plan to actively explain the issues related to legal interpretation and application in accordance with legal procedures.' They also stated, 'To ensure that the relevant procedures are completed promptly, the artist and tax representatives will cooperate sincerely, and Cha Eun-woo promises to faithfully fulfill his tax declaration and legal obligations as a citizen.' Cha Eun-woo himself also stated through his SNS, 'I am currently serving, but it was never my intention to avoid this controversy. Last year, I could no longer postpone my military enlistment and had to enlist without completing the tax investigation procedures. I will respond sincerely to the upcoming tax-related procedures. Based on the final judgment from the relevant authorities, I will humbly accept the results and fulfill the responsibilities that come with it.' Furthermore, Fantagio, through a second official comment, clarified, 'We feel a heavy responsibility for the discussions arising from the matters related to our company and affiliated artists. The issues raised are currently in the stage of confirming the facts in accordance with the tax authorities' procedures, and both the agency and the artist are sincerely approaching the investigation within their necessary scope.' They also urged, 'Once legal and administrative judgments become clear, we will responsibly implement necessary measures based on the results. However, we earnestly request that unfounded speculation, dissemination of unverified information, and excessive interpretations regarding the claims and suspicions raised be refrained from.'
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