Sunset of Safe Freight Rate System D-15... Ruling and Opposition Parties Fail to Find Compromise

Kim Jeong-jae, Floor Leader of the National Assembly Land, Infrastructure and Transport Committee: "4 Trillion Won Loss Due to Cargo Solidarity Strike... 3-Year Extension as if Nothing Happened?"
Democratic Party: "They Said They Would Talk If the Strike Was Withdrawn... Government's Excessive Response"

Members of civic, social, and religious organizations are holding a press conference in front of the War Memorial in Yongsan on the 13th, demanding an end to the suppression of the Cargo Solidarity and the abolition of the sunset clause on the Safe Freight Rate System. Photo by Heo Younghan younghan@

[Asia Economy Reporter Hyunju Lee] With the ruling and opposition parties locked in a 'strong versus strong' standoff, the sunset deadline for the Safe Freight Rate System (Cargo Truck Transportation Business Act) is just 15 days away. Although the Democratic Party of Korea passed a '3-year extension' of the Safe Freight Rate System through a unilateral review on the 9th, it is highly likely that the bill will not even be referred to the Legislation and Judiciary Committee (LJC), which traditionally prioritizes bills agreed upon by both parties. If no compromise is reached on the extension, the Safe Freight Rate System may disappear for the time being after this year.

According to political circles on the 16th, the National Assembly Land, Infrastructure and Transport Committee, which oversees the Safe Freight Rate System, has yet to narrow differences. Kim Jeong-jae, the ruling party's secretary of the Land Committee and a member of the People Power Party, recently told Asia Economy, "The Cargo Solidarity strike caused losses amounting to 4 trillion won, and I think granting a 3-year extension as if nothing happened is not just," adding, "Shippers, transport operators, truck owners, and the government should all gather to re-examine the Safe Freight Rate System from scratch."

Kim said, "The government is also in favor of reviewing the entire transportation business, including the Safe Freight Rate System, and improving any problems," but added, "It may not be possible to process it within the sunset deadline."

Within the ruling party, there is a widespread view that the Safe Freight Rate System, newly established during the Moon Jae-in administration, is a law contrary to the free market economy because it requires self-employed individuals, not workers, especially some truck owners (container, cement, etc.), to be paid a proper wage similar to a minimum wage. In particular, since the registration system was changed to a licensing system, there is a stance that truck owners who gained superiority should bear responsibilities commensurate with their authority.

A People Power Party official said, "Even after the law was enacted, accidents caused by issues such as overloading have not decreased," and added, "It is true that there is insufficient justification to extend the sunset."

The Democratic Party expressed reluctance, saying the government and ruling party are unwilling to keep the originally promised 3-year extension. The government previously insisted on 'return first, then dialogue,' but citing the Cargo Solidarity strike as a change in circumstances, it has expressed its intention to claim damages and conduct a full review of the Safe Freight Rate System.

The Democratic Party stated that even if the extension bill is held up in the LJC, it can be approved again in the standing committee and sent to the plenary session, so they intend to push it through to the end. However, even in this case, the president can exercise a veto. If the president vetoes, the bill must return to the plenary session and gain approval from two-thirds of the members present, making the possibility of passage even lower.

Ultimately, if no agreement is reached among stakeholders before the end of this year, a gap will arise in the Safe Freight Rate System. The government still maintains a firm stance, insisting on renegotiation from the beginning, and Lee Bong-ju, head of the Cargo Solidarity of the Public Transport Union, has begun an indefinite hunger strike in front of the National Assembly to defend the Safe Freight Rate System.

A Democratic Party official urged a change in the government and ruling party's stance, saying, "The government first insisted on a 3-year extension, but now they say even that is not possible. They said they would talk if the strike was withdrawn, but now, anyone can see this is an excessively harsh response."