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When a researcher affiliated with a government-funded research institution (hereinafter referred to as "public research institutions") starts a business using technology they developed themselves, is it an innovative activity or a conflict of interest? For a long time, the answer has been "both."
Public research institutions have played a central role in national R&D (research and development) for over 50 years. Now, there is a growing trend to make transferring and commercializing research results into private sectors, including laboratory startups, a core mission. This is because the demand to connect research outcomes with industries and markets to create new growth engines amid low economic growth is increasing.
The path for researchers to leave their laboratories and head toward the market has long been encouraged by the state. However, another law stood in that way: the "Conflict of Interest Prevention Act," implemented in May 2022. This system requires public officials to report in advance when their official duties become entangled with private interests. For example, if a researcher starts a business using technology they developed and acquires shares in that company, a private interest relationship could arise between the enterprise and the researcher.
The problem lies in the fact that it is difficult to completely avoid such situations during the commercialization and startup process. The more the state encourages commercialization and startups, the more conflicts of interest inevitably increase. In fact, this chilling effect has been reflected in numbers. The technology transfer rate of public research institutions peaked at 41% in 2021 and fell for three consecutive years to 29% in 2024. Similarly, startups by public research institutions decreased from 62 cases in 2020 to 25 cases in 2024.
Changes are underway to break these chains. The core of the revised "Science and Technology Public Research Institutions Act," which passed the National Assembly last month, consists of two points: First, public research institution researchers who start businesses using public technology or acquire shares as compensation from companies that receive technology transfers will be excluded from private stakeholders under the Conflict of Interest Prevention Act. Second, researchers are now allowed to engage in external activities such as technical consulting for startups based on public technology.
The problem is that even with the law changed, field researchers still hesitate to step forward easily. In fact, before the revision, it was possible to receive consulting fees or shares simply by reporting to public research institutions. However, there are specific reasons why researchers did not do so. One researcher said, "Because fists are closer than laws." Here, "fists" refer to audits conducted by the Board of Audit and Inspection, the Ministry of Science and ICT, and the Fair Trade Commission.
Researchers are holding back for fear of being singled out during an audit. Moreover, explaining why there is no problem usually falls on the individual researcher rather than the organization. As a result, those who chose stable paths by joining research institutes are even more reluctant to take any risks. Despite regulatory improvements, the prevailing atmosphere at public research institutions is one of waiting: "It will take three years before actual cases emerge."
Ultimately, the remaining challenge is establishing "clear guidelines." Research institute directors, the government, and professional startup support organizations must create examples and guidelines stating "this case is acceptable" and disseminate them to the field. The institutions responsible for audits and official interpretations also need to interpret regulations broadly in line with the legislative intent of "do not hinder startups," rather than narrowly. Only then can this regulatory relaxation lead to its original effect of guiding research outcomes to the market.
[Money Today Startup Media Platform Unicorn Factory]
in OPINION
