Not enough albums released, contract automatically renewed
According to Newsen, LIN law firm - the legal representative of three EXO members Baekhyun, Xiumin and Chen recently revealed part of the contract of the three male idols with SM entertainment company.
Some details show the harshness of the contract, which is considered a “slave contract”. The three male artists accused the contract of violating the regulations on exclusive contracts in the entertainment industry, as well as accusing SM of forcing the artists to renew their exclusive contracts.
Three members of EXO including Baekhyun, Xiumin and Chen believe that the exclusive contract of management company SM Entertainment has problems.
Specifically, law firm LIN said that when the current exclusive contract was still valid for about 1 year, SM Entertainment tried to force the artists to sign the contract early.
In which, Clause 5, Article 1 of the contract emphasizes that this contract is effective for the next 5 years starting from the date of signing.
However, during this period, if the artist does not release the agreed number of albums in Clause 4, Article 4, the contract will automatically renew until the album release requirements are met.
That is, contract enforcement is determined by the number of album releases, not limited to the duration of the contract.
In the context that SM is the unit responsible for releasing the album, this contract clause was claimed by Baekhyun, Xiumin and Chen that the management company took advantage of its authority and position as the party responsible for producing and distributing the artist's album to turn the "agreed number of album releases" within a certain time frame into a means to obtain a contract extension.
Notably, SM also did not make any payment offers for contracts renewed through this method.
According to Allkpop, this information shocked the Korean public: "Is that the reason why there are no artists' comebacks? Because SM wants to extend the artists' contracts without paying them", "If SM decides not to release an album for an artist, it means their contract will automatically be extended forever without any form of payment", "The company has the power and resources to produce and distribute artists' albums, so the number of albums released in a certain period of time is completely beyond the artist's control"...
Contract end date extended
Not only with the harsh terms above, the representative of LIN law firm also said that SM's contract term is too disadvantageous compared to other companies in the industry. In particular, the end date of the artists' exclusive contracts is also considered problematic.
SM Entertainment management company headquarters in Korea
Specifically, in 2007, the Korean Fair Trade Commission (KFTC) issued a document prohibiting SM from extending the contract term beyond its limits, such as setting the end date as the fifth year after the release of the first album.
However, in Baekhyun, Xiumin, and Chen's exclusive contracts in 2010 and 2011, the contract expiration date was extended by SM's own tricks.
"One year before the current contract ends, SM will bind the artists to a contract again. In which, each person is required to have a minimum term of 17 or 18 years," said the representative of the 3 male artists.
Currently, 3 members of EXO announced that they have filed a complaint against SM Entertainment with the Korea Fair Trade Commission. In it, the artists requested that the Commission conduct an investigation into the exclusive contracts of all SM artists, as well as the company's violations.
Previously, three members of the EXO group including Baekhyun, Xiumin and Chen announced a lawsuit against management company SM Entertainment to terminate their exclusive contract.
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