This study analyzes from a "causal perspective" whether mid-sized enterprises, which became targets of exclusion under the "SME-suitable business type designation system," suffered damages due to this policy. While the SME-suitable business type designation system generates benefits for the small and medium-sized enterprises it protects, it inevitably entails costs such as damages to large corporations and mid-sized enterprises that are subject to exclusion. The empirical analysis results of this study revealed that, first, the SME-suitable business type system did not affect profitability indicators of mid-sized enterprises such as ROA, ROE, and operating profit margin. Second, regarding growth indicators, the system's impact on mid-sized enterprises' sales growth rate and total fixed asset growth rate appeared negligible; however, it was found to have statistically significantly reduced the total asset growth rate. Overall, from a causal perspective, strong evidence that the suitable business type system negatively affected the profitability or growth of mid-sized enterprises could not be found. However, the difference-in-differences (DID) analysis did reveal evidence of decreases in gross profit margin, total asset growth rate, and total asset levels. This study presents empirical evidence regarding the damages to mid-sized enterprises that became targets of exclusion under the suitable business type designation system. Accordingly, policy considerations appear necessary to ensure that the implementation of this system also promotes the growth of mid-sized enterprises.