[Column] Fair Trade Commission Says Platform Regulation 'Different from Europe'

Samsung Electronics was taken aback last September due to the European Digital Markets Act (DMA). As the possibility of being included in the EU's platform regulation law targeting big tech companies increased, they scrambled to find a solution. Fortunately, they were excluded from the final list, and earlier this month, Fair Trade Commission Chairman Han Ki-jung met with Korean companies including Samsung in Paris, France, promising to jointly respond to the regulations.

The Fair Trade Commission, which had been like that, is now actively working to enact a 'Korean version of the DMA law' closely resembling the EU regulation. Despite opposition from the industry, on the 19th, the introduction of the Platform Competition Promotion Act was unofficially submitted as an agenda item for the Cabinet meeting.

The core of this law is to apply preemptive regulations to dominant platform operators to prevent monopolies and oligopolies by large online platforms. It prohibits self-preferencing, tying sales, restrictions on multi-homing, and most-favored-nation treatment. Violations may result in temporary suspension orders or increased fines compared to the Fair Trade Act. Once enacted, it will cover domestic companies like Naver, Kakao, and Coupang, as well as global companies such as Google, Apple, and Meta.

The Fair Trade Commission emphasizes that domestic preemptive regulation of platform operators differs from the European DMA law. Unlike the DMA law, which imposes broad sanctions, the Korean law applies only minimal rules, thus having a narrower regulatory scope. Also, Chairman Han’s remarks in Europe meant to ensure there are no discriminatory measures against Korean companies rather than opposing the law itself.

However, companies continue to complain that, in effect, there is no difference from the European DMA. From the perspective of imposing preemptive regulations, it is similarly a high-intensity regulation.

Preemptive regulation differs by only one character from post-regulation, but its impact on companies is vastly different. Since the burden of proving illegal acts lies with the companies, the pressure is significant. Moreover, monopolistic platform behaviors can be sufficiently sanctioned under current laws. The Fair Trade Commission has previously imposed fines on Naver Smart Store, Google, Apple, and others. The enactment of preemptive regulation laws will only increase the burden on companies.

The trust issues in the platform industry, highlighted by the 'Kakao incident,' are challenges that the government and companies must resolve together. However, just because problems arise in individual companies, it is unnecessary to treat all platform companies as potential criminals. Regulatory omnipotence is not the answer.