A bill aimed at expanding government oversight and evaluation powers over online platform operators is facing significant backlash from the industry as it approaches review in the National Assembly.
According to the National Assembly and platform industry sources, the amendment to the "Act on Promotion of Cooperation between Large and Small Enterprises," led by Democratic Party lawmaker Song Jae-bong, is set to be discussed in the National Assembly's Committee on Industry, Trade, and Small and Medium Enterprises this week, with further deliberation scheduled for November 17-19.
The amendment seeks to establish institutional measures to address transaction imbalances between online platform operators and their partner businesses, promoting cooperative growth.
The platform industry has expressed concerns that if the bill is processed without adequate communication, including industry feedback, it could lead to significant adverse effects. The amendment allows the Ministry of SMEs and Startups to investigate platform fees, settlement periods, and transaction statuses, and to publicly disclose the results. It can also request actions from the Fair Trade Commission if violations of fair trade laws are confirmed.
The Korea Internet Companies Association has pointed out that the boundaries between fact-finding investigations and sanctions could become blurred. They argue that the structure of publicly disclosing investigation results and requesting Fair Trade Commission actions effectively imposes a burden of sanctions on companies. An association representative stated, "Confusing the concepts of investigation and inquiry by publicly disclosing the results of fact-finding investigations and requesting actions upon confirming violations is problematic."
Another major point of contention is the requirement for sharing intermediary transaction information and contract details from partner businesses. The industry fears that if the scope of information disclosure is unclear, sensitive trade secrets, such as fee calculation structures, could be exposed. Concerns have also been raised that if the Ministry of SMEs demands fact-finding investigations and data submissions while the Fair Trade Commission is already conducting investigations into unfair trading practices, it would increase the administrative burden on companies.
Conversely, the small business sector has welcomed the bill, stating that it could provide a necessary institutional framework to address issues such as excessive fees, delayed settlements, and data monopolization, thereby enhancing the bargaining power of partner businesses.
* This article has been translated by AI.
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