(1) No prime contractor shall reduce the subcontract price fixed at the time of the entrustment of manufacturing, etc.; provided, a prime contract may reduce the subcontract price if he or she proves any good cause. <Amended on Mar. 29, 2011>
(2) Any of the following acts conducted by a prime contractor shall not be deemed an act with good cause: <Amended on Mar. 29, 2011; May 28, 2013>
1. Reducing subcontract price by citing unreasonable grounds, such as requests for cooperation, cancellation of an order by the other party to the transaction, change in economic circumstances, etc., after giving entrustment, in which the conditions, etc. for reduction in the subcontract price have not been specified at the time of giving entrustment;
2. Reducing subcontract price by applying the terms and conditions of a new agreement retroactively even to a portion already entrusted before the agreement, where the agreement is concluded with a subcontractor with regard to reduction of a unit price;
3. Reducing subcontract price excessively on the pretext that subcontract price is paid in cash or earlier than the due date for payment;
4. Reducing subcontract price by reason of a fault on the part of a subcontractor, which does not cause any substantial loss to a prime contractor;
5. Deducting an amount not less than the proper purchase price or proper rent from the subcontract price, where a prime contractor has had a subcontractor purchase from him or her the goods, etc. necessary for the manufacturing, repair, construction or service performance of the subject matter, etc. or use his or her equipment, etc.;
6. Reducing subcontract price on the grounds that the price of commodities or the price of materials, etc. at the time of payment of subcontract price has fallen compared with the price at the time of supply, etc.;
7. Reducing subcontract price unfairly for unreasonable reasons, such as loss from operations or reduced sale price, etc.;
8. Imposing on a subcontractor employment insurance premium, industrial safety and health management expenses, other expenses, etc., which should be borne by a prime contractor under the Act on the Collection of Insurance Premiums for Employment Insurance and Industrial Accident Compensation Insurance, the Occupational Safety and Health Act;
9. Other acts prescribed by Presidential Decree as equivalent to those referred to in subparagraphs 1 through 8.
(3) Where a prime contractor reduces the subcontract price pursuant to the proviso of paragraph (1), he or she shall, in advance, provide the relevant subcontractor with a document stating matters prescribed by Presidential Decree such as the reasons and standards for reduction and other details. <Added on Mar. 29, 2011>
(4) Where a prime contractor pays a reduced price without good cause after the elapse of at least 60 days from the receipt of subject matter, etc., a prime contractor shall pay interest accrued for the period beyond 60 days in accordance with the interest rate fixed and publicly notified by the Fair Trade Commission by taking into account economic circumstances, such as late-payment interest rates, etc. applied by banks under the Banking Act within the limit of 40/100 per annum. <Amended on May 17, 2010; Mar. 29, 2011>[This Article Wholly Amended on Apr. 1, 2009][Title Amended on Mar. 29, 2011]