Legislative Speed Adjustment... Possibility of Bill Stalling Due to Standing Committee Member Changes
[Asia Economy Reporter Cha Min-young] Ahead of U.S. President Joe Biden's visit to Korea from the 20th to the 22nd of this month, trade issues between Korea and the U.S. related to network usage fees have surfaced, leading to plans to postpone discussions on the network usage fee law aimed at preventing big tech companies like Netflix from free-riding on networks until the second half of the year.
According to the National Assembly and industry sources on the 11th, the Science, Technology, Information and Broadcasting Communications Committee, a standing committee of the National Assembly, is expected to hold a legislative public hearing on the network usage fee bill in June. Originally, the committee planned to complete the public hearing by the end of this month or early next month at the latest and proceed with full legislative discussions in the second half of the year, but the overall schedule has been pushed back.
The National Assembly is promoting a bill that includes grounds to mandate payment of network usage fees by global content providers (CPs) such as Netflix and Google, who unlike domestic CPs, do not pay network usage fees to telecommunications companies or internet service providers (ISPs). Six bills pending in the National Assembly's standing committee were submitted to the Information and Communications Broadcasting Bill Review Subcommittee (2nd Subcommittee) last month but their review was postponed. This was due to calls for additional discussions such as public hearings to enhance legal consistency.
The U.S. Trade Representative (USTR) issued a warning in its "2022 Trade Barriers Report" published at the end of March, stating that "concerns over Korea's international trade obligations will increase if the network usage fee mandate bill passes." The U.S. side argued that it would violate the Korea-U.S. Free Trade Agreement (FTA) and other trade agreements, and it is known that the Ministry of Foreign Affairs and the Ministry of Trade, Industry and Energy conveyed these concerns to the Ministry of Science and ICT, the main ministry in charge. The National Assembly is also believed to be adjusting the pace of legislation ahead of the major event of President Biden's visit. It is reported that President Biden is also considering a visit to Netflix Service Korea.
The telecommunications industry is expressing concerns that the bills in the National Assembly may stall as the first half of the 21st National Assembly ends at the end of this month and standing committee members are abruptly replaced. The possibility of a parliamentary deadlock has increased amid a power struggle over the chairmanship of the Legislation and Judiciary Committee between the ruling Democratic Party and the opposition People Power Party, which have swapped roles. An industry official said, "We hope for a prompt legislative schedule so that the network usage fee bill can be pursued with continuity, but we believe it will not be easy."
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