Reasons for Proposal and Major Provisions

On January 11, 2022, six precious lives were lost when an apartment under construction collapsed in Gwangju Metropolitan City. The construction company was Hyundai Development Company, which was also involved in the Hakdong incident where 17 casualties occurred. This is the second incident of its kind in just seven months, in the same region, and under the responsibility of the same construction company. Residents are understandably enraged. An investigation into the cause of the incident found clear indications of poor construction. Reduced concrete strength due to substandard placement and curing, unjustified use of flat slab construction (a structure consisting of floors and columns without beams), speed battles to reduce the construction period, unlawful multilevel subcontracting, and other unrepentant practices of the construction industry led straight to the incident. 

The current Act prescribes that where construction work has been poorly executed, either willfully or negligently, and it endangers the public by causing serious damage or destruction to an important structural component, the construction business may have its registration canceled or be ordered to suspend business for a period of up to one year. It also prescribes that if a registration is canceled, the construction business is unable to register again for five years. The problem is that cancellation of registration is not compulsory even if a member of the public is fatally injured. There is growing criticism that cancellation of registration should be mandatory in the event of a fatal accident. Critics also point out that there should be tougher requirements for any construction business that wishes to re-register after its registration is canceled. 

Accordingly, the Amendment prescribes compulsory cancellation of registration of any construction company whose poor construction work causes serious damage or destruction to an important structural component of a facility and leads to an incident involving five or more public fatalities. It also incorporates previous fatal accidents of construction businesses into the reasons for disqualification from registration so as to prevent the registration of construction businesses with such a history for ten years, thereby aiming to prevent poor construction and ensure the safety of workers and society in general (Article 13 (1) 3 (a), subparagraph 10-2 of Article 83 newly inserted, etc.).