'B Mart Regulation Act' Public Hearing at the End of This Month... "Ban on Early Morning Delivery is a Misunderstanding"

Assembly Members Gather Opinions Before Proposal... Industry Watches Closely

Shin Young-dae, member of the Democratic Party of Korea. [Photo by Yonhap News]

[Asia Economy Reporter Lim Chun-han] The amendment to the Act on the Promotion of Mutual Growth between Large, Medium, and Small Enterprises (Mutual Growth Act), which restricts the sales items of online delivery platforms, also known as the ‘B Mart and Y Mart Regulation Act,’ is gaining momentum. A public hearing to gather opinions from industry experts and stakeholders will be held ahead of the bill’s submission later this month.

A representative from the office of Shin Young-dae, a member of the Democratic Party of Korea, told Asia Economy on the 4th, "We are currently discussing the regulatory approach internally and have not yet set a specific timeline for the bill’s submission," adding, "We plan to hold a public hearing or seminar around the end of this month to collect opinions."

◆ "Supplementing the Blind Spots of the Mutual Growth Act" = The existing Mutual Growth Act protects the business areas of small and medium enterprises through a business adjustment system. Small business owners who are expected to suffer losses due to large corporations’ large marts can apply for business adjustment to the Korea Federation of SMEs, and through mutual consultation, they decide on adjustments such as business hours, sales items, and mutual growth compensation payments. However, recently, platforms like Baedal Minjok and Yogiyo have gone beyond brokerage by establishing their own logistics warehouses and engaging in sales, creating regulatory blind spots. There is also a high possibility that they will continue to expand their product lines and produce food items themselves, infringing on small business owners’ business areas. The amendment to the Mutual Growth Act aims to regulate sales items and prevent online delivery platform operators from infringing on local small business districts.

◆ "Not a Regulation on Dawn or Rocket Delivery" = Concerns arose that the regulation might extend to dawn delivery and rocket delivery services, but Shin’s office explained that this is a misunderstanding related to the business adjustment system. The representative said, "There is no content regulating dawn delivery or rocket delivery," and added, "It makes no sense to regulate the business hours of online services."

If the bill is submitted, discussions on regulating online delivery platforms are expected to accelerate rapidly. When Shin pointed out the issue of local small business district infringement by delivery platform companies during the National Assembly inspection of the Industry, Trade, and Small and Medium Venture Business Committee in October last year, then Minister of SMEs and Startups Park Young-sun responded, "The Ministry of SMEs and Startups hopes this will be an opportunity to strengthen the Mutual Growth Act through more communication with the National Assembly regarding monopoly prevention issues."

The online delivery platform industry is closely monitoring the bill’s progress. A delivery industry official said, "Our position is clear that this is not an infringement on commercial districts, but since the bill’s details have not yet been finalized, we are taking a wait-and-see approach."