The Korea Association of Realtors (hereinafter referred to as the Association) has seen the legal establishment of its statutory body indefinitely delayed. Although the prerequisite of launching a unified association was hastily completed, the related bill has been stalled in the National Assembly for over six months. The Association recently argued that legal establishment is necessary to eradicate the controversial jeonse fraud, but the National Assembly is reluctant to agree, citing concerns such as 'restriction of competition.'
According to the Land, Infrastructure and Transport Committee of the National Assembly on the 26th, the "Partial Amendment to the Licensed Real Estate Agents Act" (hereinafter referred to as the Amendment), which centers on the legal establishment of the Association, was not properly discussed in the plenary sessions in February and March.
The Amendment, introduced by Kim Byung-wook of the Democratic Party of Korea in October last year, includes provisions for the Association to unify the window for inspecting false or exaggerated real estate listings and to supervise and manage unregistered brokers. To expedite the passage of the Amendment, the Association merged with the Sae Daehan Licensed Real Estate Agents Association, which was the second largest in membership at the end of last year, paying 2.5 billion KRW in the process.
However, the Land, Infrastructure and Transport Committee issued a review report with a negative opinion at the plenary session last month. The Committee noted, "The Association is already performing the establishment and implementation of the 'Ethical Charter' under current laws, so the amendment does not bring significant changes." It also pointed out, "While we understand the intention to establish a sound real estate transaction order, it is necessary to discuss whether it is appropriate to entrust tasks directly related to citizens' rights and obligations to a private association." This was effectively a rejection of the Amendment.
The Committee also cited the Fair Trade Commission's opinion that if the Association holds a monopolistic position and authority, there is a risk of competition-restricting acts such as limiting the business activities of licensed real estate agents. The Fair Trade Commission favors utilizing the currently operating "Real Estate Transaction Order Disruption Reporting Center." This aligns with the stance of the Korea PropTech Forum, which includes companies like Zigbang, arguing that "(if the Amendment passes) the Association may abuse its enforcement rights, hindering market innovation and vitality and undermining the foundation of fair competition."
Given this situation, voices of dissatisfaction are emerging within the Association. A licensed real estate agent in the Eunpyeong District of Seoul criticized, "The National Assembly and government are hostile to the Amendment, but the Association is ignoring this and pushing the issue forward." If the bill's stagnation in the National Assembly prolongs, the unrest is expected to grow.
The Association explained that it is aware of the internal discussions and that the mood in the National Assembly or government has not changed. An Association official said, "Legal establishment is essential to prevent jeonse fraud, and both the ruling party and government agree with this. We are continuously probing the National Assembly's intentions and expect the bill to pass in April."
Meanwhile, a petition regarding the legal establishment of the Association, conducted from the 17th of last month to the 18th of this month, achieved 50,000 signatures and was referred to the Land, Infrastructure and Transport Committee.
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