KCCI Visits National Policy Planning Committee on the 9th to Propose Mega Sandbox
Mega Sandbox to Be Used as a Policy Blueprint
First Introduced in KCCI Report on July 1
Customized, All-Around Support Centered on Local Governments
"Bigger Sandbox, Greater Innovation"
As the government has begun to review the 'Mega Sandbox' proposed by the Korea Chamber of Commerce and Industry (KCCI) as a blueprint for regulatory reform policy, expectations are rising within the business community. This concept involves transforming entire regions into new technology testing grounds, rather than focusing on individual businesses or companies, making it a large-scale project that goes beyond existing regulatory sandboxes.
According to the business community on July 10, the previous day, the KCCI visited the annex of the Government Complex Seoul in Changseong-dong to present the Mega Sandbox to the National Policy Planning Committee and delivered related materials. It is reported that the committee showed great interest, asking numerous questions during the meeting. This marks the first time under the current administration that the government has officially engaged with a business organization to discuss regulatory reform.
The Mega Sandbox is a concept first introduced by the KCCI in its report, 'Private Sector Regulatory Sandbox in Statistics,' published on July 1. The report emphasized that "experiments have so far been conducted within too narrow a scope" and stressed the need for "broader and more flexible systems." This proposal stems from the recognition that existing regulatory sandboxes alone cannot drive change across entire industries.
Under the current regulatory sandbox system, when a company introduces a new technology or service to the market, the government exempts certain existing regulations for a set period. This is a kind of pilot operation system, with the idea that "the government will bear the risk, so go ahead and try." It allows companies to test their products in the market without formal approval, and based on the results, related laws or systems may be revised.
However, the KCCI has pointed out limitations to this approach. Since it only lifts individual regulations, it does not suit industries where multiple technologies must operate together, and the concentration of pilot cases in the Seoul metropolitan area has also been a problem. In particular, as the central government makes all decisions, it has repeatedly been noted that it is difficult to reflect local conditions or needs.
The KCCI explained that, after operating the 'Regulatory Sandbox Support Center' since 2020 and examining hundreds of cases on the ground, it has concluded that "the unit of experimentation should now be entire regions, not individual companies." This means that the focus should shift from testing single technologies to designing the entire industrial ecosystem.
Accordingly, the KCCI has stated that the system should be expanded by designating specific local governments as integrated experimental zones, allowing those regions to directly select industrial sectors and comprehensively ease necessary regulations. This is because, in areas such as artificial intelligence, biotechnology, clean energy, and future mobility?where regulations are intricately intertwined?multiple systems must be relaxed simultaneously for effective testing.
The Mega Sandbox differs from existing systems in that it includes: comprehensive revision of multiple regulations; region-specific, locally led design; and all-encompassing support such as regulatory easing, education, workforce development, research and development (R&D), and tax or location incentives. The core of the system is to provide an 'infrastructure package' to build an industrial ecosystem, not just regulatory exemptions for pilot tests.
For example, if a particular region seeks to attract the future mobility industry, support would not be limited to easing some automobile-related regulations. Instead, it would include securing road test sections, suspending driver qualification requirements, implementing workforce development programs in collaboration with local universities and research institutes, supporting data centers and communication networks, and granting tax reductions for business locations?all bundled together.
The National Policy Planning Committee has also recognized that the existing regulatory sandbox system, being led solely by the central government, has faced limitations in terms of specificity and speed. The committee agrees on the need for new measures to address these shortcomings. It considers the proposal significant, as it enables the integrated design of industries and systems at the regional level, and is currently conducting a practical review.
Going forward, the government and the KCCI are expected to continue discussions focusing on institutionalizing and piloting the Mega Sandbox. A KCCI official stated, "Although no specific meeting schedule has been set yet, both sides have agreed to discuss this issue in greater detail."
The industrial sector expects that if the Mega Sandbox is introduced, local governments will have greater opportunities to attract new industrial ecosystems, and the regulatory testing structure, currently centered on the Seoul metropolitan area, could spread nationwide. In particular, there are assessments that the Mega Sandbox could serve as a breakthrough for institutional experimentation in industries such as artificial intelligence, data, and biotechnology, where "partial deregulation is not sufficient." If the government institutionalizes this proposal, there is a possibility that, starting next year, regions will directly design regulatory exemptions and build infrastructure, ushering in a full-fledged era of "region-led industrial policy."
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