Public procurement

Designation of Production Facilities for Products Made by Persons with Severe Disabilities — 10 Workers, 70%, 60% Severe and Re-designation

Public institutions must give purchasing priority to products made by persons with severe disabilities and may buy them through private contracts. To qualify, a vocational rehabilitation facility for persons with disabilities, a welfare organization for persons with disabilities, or a rehabilitation training facility (a type of mental health rehabilitation facility) must meet the employment requirements for each product (at least 10 participating workers with disabilities, persons with disabilities making up at least 70% of all workers, at least 60% of them with severe disabilities, and at least 50% of total working hours by workers with disabilities) and be designated as a production facility by the Minister of Health and Welfare. The designation is valid for 3 years, and re-designation must be applied for at least 60 days before expiry.

Procedure

  1. 1. Check whether your facility is eligible

    Eligible applicants are vocational rehabilitation facilities and welfare organizations for persons with disabilities under the Act on Welfare of Persons with Disabilities, and rehabilitation training facilities under the Mental Health Welfare Act. Ordinary companies and sole proprietors cannot receive this designation, so the facility report or organization establishment permit must be in place first.

  2. 2. Check employment requirements per product

    At least 10 persons with disabilities must take part directly in production or service delivery, persons with disabilities must regularly make up at least 70% of all workers, and at least 60% of them must have severe disabilities. Working hours of persons with disabilities must also be at least 50% of total working hours. If you make two or more products, each product must meet the requirements separately, with at least 5 participating workers with disabilities per product.

  3. 3. Prepare the application and attachments

    The Minister of Health and Welfare announces the application method and period at least once a year. During the announced period, submit the designation application with the facility report certificate or establishment permit, the register of workers, the wage ledger and a copy of the articles of association or bylaws.

  4. 4. Review, supplementation and certificate

    The Minister reviews the application against the designation standards and may request supplementation. If supplementation is not provided without good reason, the application may be returned. If the facility qualifies, a production facility designation certificate is issued and the designation is publicly announced.

  5. 5. Re-designation and on-site inspections

    The designation is valid for 3 years, and a re-designation application must be filed at least 60 days before expiry. If there has been no administrative sanction or penalty surcharge in the last 3 years and the number of workers with disabilities has increased, re-designation may be granted for 3 to 5 years. The Ministry may request records or enter the facility for inspection, so keep the register of workers and wage ledger consistent with actual operations.

Required documents

  • Application for designation (re-designation) as a production facility for products made by persons with severe disabilities
  • Welfare facility report certificate for persons with disabilities, establishment permit for a welfare organization (corporations) or mental health rehabilitation facility installation report confirmation
  • Register of workers
  • Wage ledger
  • Copy of articles of association or bylaws
  • Per-product tally of participating workers with disabilities and working hours (for pre-check)
  • Letter of authorization (when submission is handled by an agent)

Fees

Generally from several hundred thousand won to several million won across the industry · Quoted after consultation depending on the number of products, the state of the register of workers and wage ledger, and whether it is a re-designation. Government fees are separate.

Legal basis and review date

  • Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 2
  • Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 7
  • Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 9
  • Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 10
  • Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 18
  • Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 22
  • Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 23
  • Enforcement Decree of the Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 16
  • Enforcement Decree of the Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 17
  • Enforcement Rule of the Act on Special Cases Concerning Preferential Purchase of Products Made by Persons with Severe Disabilities, Article 4

Checked against the statutes on

Statutes and public notices change, so each case needs to be checked individually. Statute titles are given in English for reference. The Korean statutes are the authoritative text.

Check these first

  • Using the production facility name without designation, or lending a designated name to others, is punishable by up to 1 year of imprisonment or a fine of up to 10,000,000 won, and lending the name is a ground for revocation.
  • Failing to submit records or submitting false records during supervision incurs an administrative fine of up to 3,000,000 won, and refusing an inspection without good reason is a ground for revocation.

Frequently asked questions

Can an ordinary company be designated as a production facility?
No. Eligibility is limited to vocational rehabilitation facilities for persons with disabilities, welfare organizations for persons with disabilities, and rehabilitation training facilities. Ordinary companies employing many persons with disabilities should consider other schemes such as standard workplaces for persons with disabilities.
How are the requirements applied if we make two or more products?
They are applied per product. At least 5 persons with disabilities must take part in producing each product, and the 70% disabled workers, 60% severe disabilities and 50% working hours ratios must also be met per product.
How long is the designation valid and when should we apply for re-designation?
It is valid for 3 years from designation, and re-designation must be applied for at least 60 days before expiry. If there has been no administrative sanction or penalty surcharge in the last 3 years and employment of persons with disabilities has increased, re-designation may be granted for 3 to 5 years.
Can a designation be revoked?
Yes. Falling short of the requirements or breaching quality assurance duties can lead to revocation or suspension of business for up to 6 months, and designation obtained by false means or lending the name must be revoked. A facility substantially identical to a revoked one cannot be designated again within 1 year.
Does an administrative agent handle the designation application?
Yes. Hwang Yunsang Administrative Office prepares a per-product employment requirement checklist, drafts the designation or re-designation application and attachments, handles submission to the Ministry of Health and Welfare, and drafts documents in response to supplementation requests.

Contact us

Hwang Yunsang Administrative Office in Songdo, Incheon prepares and submits administrative documents and explains the procedure. If your situation is similar, send us a message.

📍 2697, 26F POSCO Tower-Songdo, 165 Convensia-daero, Yeonsu-gu, Incheon, Republic of Korea · 📞 010-3374-2687 · 🌐 hwangadmin.com

This guide is general information based on public sources. Requirements, documents and deadlines differ by case and by the competent agency, so please confirm them before you proceed.