[Asia Economy Reporter Bu Aeri] As discussions in the National Assembly regarding the 'Act on the Fairness of Online Platform Intermediated Transactions (Onpleob)' have begun, the industry has expressed concerns about premature regulations.
The National Assembly's Political Affairs Committee held a public hearing on the morning of the 22nd to listen to opinions from the industry related to the Onpleob. Attendees included the Korea Internet Corporations Association, which includes companies such as Naver and Kakao, as well as experts.
The Onpleob mandates that platform operators and tenant businesses must obligatorily draft and provide contracts to prevent disputes, and includes provisions that impose fines up to twice the amount of the violation if platform operators engage in abusive practices.
Park Seong-ho, chairman of the Korea Internet Corporations Association, pointed out that "the efforts of companies that have survived through fierce competition in a perfectly competitive market are being ignored, and the bill is being enacted under the framework of a dominant-subordinate relationship."
Chairman Park argued, "We are competing with global companies, and regulating all businesses by law should not affect the momentum of industrial growth."
Additionally, according to the Onpleob, items that must be specified in contracts include 'the order and criteria by which goods and other information are exposed on online platforms,' causing domestic platform companies, for whom big data is a core competitive tool, to fear disclosing trade secrets.
Chairman Park appealed, "A thorough review is needed regarding contract contents common to the bill and the leakage of trade secret algorithms," and added, "Considering the highly potential and diversifying online platform industry, we ask for autonomous alternatives rather than strong regulations."
Professor Jeon Seong-min of Gachon University’s Department of Business Administration, who attended the public hearing, also said, "It is necessary to sufficiently examine the ripple effects through economic analysis," and added, "Premature regulation could make things difficult for everyone, so careful introduction of regulations is needed."
However, in response, Kim Jae-shin, Vice Chairman of the Fair Trade Commission, stated, "There have been consistent types of damages to tenant businesses related to online platforms, which worsened between 2018 and 2020," and said, "Nearly 30 online platforms are subject to the law, and the number of tenant businesses is expected to be 1.8 million, so it is difficult to establish a dominant-subordinate transaction order while ignoring this market."
He continued, "There have been 10 surveys since 2018, and over 40% of tenant businesses responded that they experienced unfair practices," adding, "We will start at a low level in areas that do not hinder innovation."
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