Public Home Shopping-Korea SMEs and Startups Distribution Center Merger Also Under Scrutiny at Parliamentary Audit: "Insufficient Discussion and Verification" vs. "Need to Persuade"

Integration of public institutions under the Ministry of SMEs and Startups
The opposition criticizes the lack of discussions with affected parties before the merger
Union chief: "We cannot agree to a merger without guarantees of working conditions"
Ruling party cites profligate management... urges the Korea SMEs and Startups Distribution Center to "speak out more actively"

The ruling and opposition parties clashed during a parliamentary audit over the proposed merger of Public Home Shopping and the Korea SMEs and Startups Distribution Center. The opposition criticized the lack of sufficient discussions with the organizations involved, while the ruling party cited the need for the merger, including to provide one-stop support for small and medium-sized enterprises seeking sales channels.

Minister of SMEs and Startups Lee Soyoung answers lawmakers' questions during a comprehensive audit of the Ministry of SMEs and Startups and other agencies at the National Assembly on Oct. 23, 2026. Photo by Yoon Dongju

At a comprehensive audit by the National Assembly’s Trade, Industry, Energy, SMEs and Startups Committee on Oct. 23, Seo Jiyeong, a lawmaker from the People Power Party, said, “For a merger of public institutions to gain procedural legitimacy and minimize social conflict, there must be sufficient discussion of public opinion, open debate, the relevant ministry’s position, and the views of stakeholders at affiliated institutions.”

Asked about plans to reorganize the structures and workforce of the institutions slated for merger, Minister of SMEs and Startups Lee Soyoung replied, “My understanding is that, in principle, employees will be retained. I also understand that adjustments to working conditions, including differences in pay, will be necessary.”

Bae Juhyun, head of the Public Home Shopping union, who appeared as a witness that day, said, “We cannot agree to a merger without a review of its expected benefits or sufficient verification, or guarantees of working conditions,” adding, “There was no explanation of the merger even during an official meeting with the first vice minister, and the government’s merger plan was announced without gathering opinions.”

Bae Juhyeon, chair of the Public Home Shopping union, speaks after appearing as a witness at the comprehensive audit held by the National Assembly’s Trade, Industry, Energy, SMEs and Startups Committee on the 23rd. Yonhap News.

Bae said the two institutions have entirely different founding purposes and core functions, and that there has been insufficient objective verification. “The Korea SMEs and Startups Distribution Center provides policy support funded by the government budget, while Public Home Shopping is a distribution company that competes with private-sector firms in the market. They have nothing in common, yet the government says a merger will improve support for sales channels,” she said. “There has also been insufficient objective verification of the costs involved in the merger.”

Bae stressed, “Public Home Shopping is following labor dispute procedures at the Seoul Regional Office of Employment and Labor, and we will seek real job security through a collective bargaining agreement. A strike is a last resort, and the Ministry of SMEs and Startups should engage in direct dialogue. If it does, we will negotiate responsibly.”

The ruling party emphasized the need for a merger. Kim Woni, a lawmaker from the Democratic Party of Korea, raised concerns about Public Home Shopping’s poor and profligate management, noting that calls for a merger had been made for a long time. He urged the Korea SMEs and Startups Distribution Center to make a more active case for the merger.

“Are you pursuing this merger to address Public Home Shopping’s poor performance and problems, and to combine the Korea SMEs and Startups Distribution Center’s role in implementing sales-channel policies with Public Home Shopping’s support, so that small and medium-sized enterprises can receive one-stop support for their sales channels?” Kim asked. Lee Taesik, head of the Korea SMEs and Startups Distribution Center, replied, “Yes.”

When Kim asked, “Do you plan to drive the growth of small and medium-sized enterprises by providing support throughout the entire process, from marketing and sales to performance management, once the merger is completed?” Lee replied, “Yes.” Kim added, “I hope you will speak out more actively and help persuade others on this issue.”

This content was produced with the assistance of AI translation services.