Gyeonggi Province Recovers 1.25 Billion Won in Unpaid Rent at Foreign Investment Zones Through Proactive Administration

[Suwon Ilbo=Reporter Park No-hoon] Gyeonggi Province has successfully recovered a total of 1.25 billion won in unpaid rent from delinquent companies in foreign investment zones (rental industrial complexes) within the province through proactive administration.

According to the province on the 21st, the total unpaid rent in foreign investment zones within the province stands at approximately 8.5 billion won, of which the province has recovered 1.252 billion won (from four companies), equivalent to 14.7%, over last year and this year.

Of the unpaid rent, 65% of the total—5.57 billion won—is from bankrupt, liquidated, and closed companies, with the actual recoverable amount being 2.93 billion won. Taking this into account, the actual recovery rate is 42.7%.

As continued nonpayment of rent due to management crises of tenant companies persisted, the province has induced corporate restructuring and management normalization through investment matching such as capital partnerships and business transfers (a method of comprehensively transferring assets, liabilities, rights, obligations, and organizations of an independent specific business division) since last year, recovering 929 million won.

Additionally, through continuous recovery activities including fact-finding investigations conducted this year and meetings with relevant companies, the province recovered an additional 323 million won.

In the case of Company D, a tenant at the Pyeongtaek Chupallsan Industrial Complex, after losing its qualifications as a foreign investment zone tenant due to foreign shareholding withdrawal and entering corporate rehabilitation procedures due to management crisis, the province discovered potential investors of similar industries hoping to purchase existing factories and supported business transfers for the existing factories.

Through negotiations that benefit both the province, existing companies, and new companies, the province efficiently utilized foreign investment zone sites while successfully recovering 240 million won in unpaid rent, which could have been difficult to recover as non-performing debt.

As Company G, another foreign investment company in the Pyeongtaek foreign investment zone, continued to default on rent, the province supported a capital partnership agreement with promising domestic capital matching, on the condition of full payment of unpaid rent, recovering approximately 500 million won.

The province plans to continue collection activities on outstanding debt through garnishment and payment orders as well as corporate asset inquiries.

For companies whose bankruptcy and liquidation procedures have been concluded by the court, the province terminates tenant contracts, implements administrative procedures such as directing them toward public auctions and recovery of original conditions, and establishes and operates transparent and systematic management standards.

Additionally, from this month, the province has strengthened the tenant screening system to attract new quality enterprises and, for existing struggling companies, has established nation's first detailed operational guidelines, setting support standards with priority given to corporate restructuring through investment matching.

Lee Min-woo, Director of the Investment Promotion Division at the Province, stated, "Going forward, we will continue to recover unpaid rent through proactive administration to eliminate reverse discrimination against companies paying faithfully, and through a balanced approach combining principles and inclusivity, we will create the most rational foreign investment zone system in the nation."

Meanwhile, within the province, 99 foreign investment companies are located in eight rental complexes covering 1.91 million square meters in Pyeongtaek, Hwaseong, and Paju areas.

With sales of 8.619 trillion won, foreign investment of 2.14 billion dollars, and employment of 9,425 people, it is the largest scale in the nation.