[Untangling Business]③ I'll Pay for Parking, Let's Park During the Day!

Shared parking lot utilizing resident-priority parking spaces that are vacant during daytime hours.
[Photo by Modu Company]

[Asia Economy Reporter Kim Jong-hwa] # Mr. A, an information technology (IT) expert who returned to Korea after studying in the United States, developed an app that provides parking sharing services domestically, inspired by parking sharing services in the U.S. However, Mr. A encountered difficulties. While parking sharing services can be offered for private parking spaces with the owner's permission, resident-priority parking spaces are owned by local governments, requiring each municipality to amend related ordinances to enable parking sharing services. Mr. A had to travel nationwide to persuade local governments and councils to establish parking sharing services.

Nowadays, when making plans, people first search for parking lots near the meeting place. If there is no suitable parking, they have to use public transportation. Those who have experienced driving into congested city centers, searching for parking, and arriving late to appointments despite knowing the severe parking shortage can relate.

Especially during daytime, many empty parking spaces are noticeable, but some places cannot be parked in arbitrarily. These are resident-priority parking lots. Many drivers have had the experience of parking in a resident-priority parking lot in a hurry, only to receive fines or have their cars towed. Why is it prohibited to park temporarily in empty resident-priority parking lots during the day?

Some local governments prohibit offering resident-priority parking lots to others or using them for other purposes. The current Parking Lot Act stipulates that the head of the local government may operate some parking spaces installed in residential areas as exclusive parking sections for nearby residents' cars. Based on this, local governments enact and operate parking-related ordinances detailing the installation and operation of resident-priority parking lots.

However, there is no legal basis for resident-priority parking lot sharing businesses, and some local governments still cannot implement parking sharing services. Due to variations in ordinances and regulations regarding resident-priority parking lots and parking sharing across cities, counties, and districts, the new parking sharing business has not spread nationwide.

Parking sharing businesses connect owners of parking spaces with other drivers, allowing sharing during times when the owner is not using the parking lot. Various types of parking spaces can be shared through mobile apps, and drivers can use shared parking lots by paying fees.

Since it is based on the concept of sharing, usage fees are much cheaper than regular parking lots. Owners of parking spaces can generate income by utilizing empty spaces in front of their homes or stores, and drivers can use shared parking lots at affordable prices without worrying about enforcement.

The Small and Medium Business Ombudsman, which received complaints, decided to establish provisions in the superior Parking Lot Act allowing resident-priority parking lot sharing businesses and to encourage local governments to amend ordinances through cooperation with related agencies. They judged that opening resident-priority parking lots to visitors during daytime hours when residents do not use them could prevent illegal parking and expand parking sharing businesses.

An official from the Small and Medium Business Ombudsman explained, "As a result of consultations with the Ministry of Land, Infrastructure and Transport and the Ministry of the Interior and Safety, amendments to the Parking Lot Act to newly establish legal grounds for parking sharing businesses have been made, and discussions are underway to reflect this in ordinances of local governments nationwide, with the process nearing completion."

Regarding profits generated through parking sharing businesses, the distribution varies depending on local government ordinances, but about half goes to the parking space owners, 30% covers operating costs, and the remaining 20% becomes local government revenue. Utilizing empty parking spaces helps alleviate urban parking shortages and generates economic benefits.

In the U.S., over 120 parking sharing apps operate, while about 30 operate domestically. The most well-known app, Modu-ui Jujajang, has parking sharing agreements with 23 districts in Seoul, 7 districts in Busan, Bucheon, Gwangju, and others. As of the end of last month, it recorded 2.8 million cumulative downloads and 1.6 million cumulative members. It also has an average monthly user count of 600,000, 8 million monthly parking lot searches, information on about 55,000 parking lots, and operates approximately 15,000 shared parking lots.

Kang Su-nam, CEO of Modu Company, which operates the parking sharing app "Modu-ui Jujajang," said, "I had to travel nationwide to explain and persuade local governments to include just one sentence in their ordinances stating 'parking sharing is allowed.' Fortunately, I heard that the government amended the Parking Lot Act, which will be enforced starting August 5. I hope more people can park more easily through parking sharing."