(1) Where a prime contractor entrusts any manufacturing, etc., to a subcontractor and where a prime contractor, after having entrusted any manufacturing, etc., either entrusts other manufacturing, etc. which is not included in the content of a relevant contract, or makes an entrustment to change the content of the relevant agreement (hereafter in this paragraph, the above-mentioned both types of entrustment shall be referred to as "additional/changed entrustment"), the prime contractor shall issue the subcontractor a document specifying the matters referred to in paragraph (2) (including an electronic document under subparagraph 1 of Article 2 of the Framework Act on Electronic Documents and Transactions: hereafter in this Article, the same shall apply) within the time-limit classified in the following subparagraphs: <Amended on Mar. 29, 2016>
1. Where the manufacturing is entrusted: Before the subcontractor commences any work for delivery of goods on the basis of the entrustment with manufacturing, etc. and the additional/changed entrustment;
2. Where the repair is entrusted: Before the subcontractor commences the act of the repair on the basis of the entrustment with manufacturing, etc. and the additional/changed entrustment;
3. Where the construction is entrusted: Before the subcontractor commences the contracted construction work on the basis of the entrustment with manufacturing, etc. and the additional/changed entrustment;
4. Where the service is entrusted: Before the subcontractor commences the act of performing the service on the basis of the entrustment with manufacturing, etc. and the additional/changed entrustment.
(2) A document under paragraph (1) shall include the following details, and the relevant prime contractor and subcontractor shall sign thereon [including digital signature (referring to one that can identify the real name of a signer) defined in subparagraph 2 of Article 2 of the Digital Signature Act; hereafter in this Article the same shall apply] or shall affix their names and seals thereto: <Amended on Jan. 25, 2010; Jan. 16, 2018; Nov. 26, 2019; Jun. 9, 2020; Jul. 18, 2023>
1. The terms and conditions of the subcontract agreement, such as the subcontract price and the methods of paying such payment;
2. Requirements, methods, and procedures for adjusting the subcontract price under Article 16-2 (1);
3. Details prescribed by Presidential Decree regarding the subcontract price adjustment system, such as the name and main raw materials of, the adjustment requirements for, and the standard indices and formulas of, subject matters, etc. subject to the subcontract price adjustment system;
4. Other details prescribed by Presidential Decree which are required to be included in the document.
(3) When a prime contractor makes an entry of the details specified in paragraph (2) 3, he or she shall faithfully negotiate with the subcontractor to ensure that unfair details contrary to the interests of the subcontractor are not included. <Added on Jul. 18, 2023>
(4) A prime contractor need not make an entry of the details specified in paragraph (2) 3 in a document, in any of the following cases; provided, in the case of subparagraph 4, the prime contractor and the subcontractor shall clearly state the purport and reasons in a document: <Added on Jul. 18, 2023>
1. Where the principal contractor falls under the classification of small enterprises under Article 2 (2) of the Framework Act on Small and Medium Enterprises;
2. Where the subcontract transaction period is within the period prescribed by Presidential Decree not exceeding 90 days;
3. Where the subcontract price is not more than the amount prescribed by Presidential Decree not exceeding 100 million won;
4. Where the prime contractor and the subcontractor agree on the non-adoption of the subcontract price adjustment system.
(5) No prime contractor shall abuse his or her superior bargaining position or engage in any act to avoid the application of this Article by fraud or other improper means, in relation to the subcontract price adjustment system. <Added on Jul. 18, 2023>
(6) Notwithstanding paragraph (2), the prime contractor may issue a document without stating relevant details on the matters that are difficult to determine as at the time of entrustment, if good cause exists, such as conducting emergency repair work due to a disaster or accident. In such cases, he or she shall state in the document the reason the relevant details have not been determined and the expected date on which such details are to be determined. <Added on Jan. 25, 2010; Jul. 18, 2023>
(7) Where a prime contractor issues a document without stating some details pursuant to paragraph (6), he or she shall issue, without delay, a new document stating the relevant details as soon as such details are determined. <Added on Jan. 25, 2010; Jul. 18, 2023>
(8) Where a prime contractor fails to issue a document stating matters referred to in paragraph (2) (including a document that does not contain some details pursuant to paragraph (6)) in entrusting manufacturing, etc., a subcontractor may request the prime contractor to verify the details of subcontract by notifying, in writing, him or her of the matters prescribed by Presidential Decree such as the details of subcontract and the subcontract price. <Added on Jan. 25, 2010; Jul. 18, 2023>
(9) A prime contractor shall send a written reply expressing whether he or she accepts or denies the details to a subcontractor within 15 days from the date he or she is notified thereof under paragraph (8), and if the prime contractor fails to send his or her reply within such period, it is presumed that entrustment is made as notified by the subcontractor; provided, this shall not apply if it is impossible to send such a reply due to a natural disaster or other accidents. <Added on Jan. 25, 2010; Jul. 18, 2023>
(10) The notification under paragraph (8) and a reply thereto under paragraph (9) shall be signed and sealed respectively by the subcontractor and the prime contractor. <Added on Jan. 25, 2010; Jul. 18, 2023>
(11) Matters necessary for the notification under paragraph (8) and a reply thereto under paragraph (9) shall be prescribed by Presidential Decree. <Added on Jan. 25, 2010; Jul. 18, 2023>
(12) A prime contractor and a subcontractor shall retain documents concerning subcontract transactions, as prescribed by Presidential Decree. <Amended on Jan. 25, 2010; Jul. 18, 2023>[This Article Wholly Amended on Apr. 1, 2009]