Business Community Warns of Double Hardship for Companies over Safe Freight Rate System Revival and Tariff Measures

"Sharp Rise in Freight Rates, Undermining Market Autonomy"

The business community has expressed concern over the passage of an amendment to the Trucking Transport Business Act by the National Assembly's Land, Infrastructure and Transport Committee, which includes a three-year temporary extension of the Safe Freight Rate System for cargo trucks.

The six major business organizations?the Korea Chamber of Commerce and Industry, Korea Federation of SMEs, Korea Employers Federation, Federation of Korean Industries, Korea International Trade Association, and Korea Federation of Middle Market Enterprises?stated on July 21, "The Safe Freight Rate System has already been implemented once, but rather than improving traffic safety, it resulted in a sharp increase in freight rates and undermined market autonomy, leaving behind various side effects before expiring."

Members of the Cargo Solidarity Headquarters of the Public Transport Union under the Korean Confederation of Trade Unions held a rally on the 18th in front of the National Assembly in Yeouido, Seoul, urging the enactment of the Safe Freight Rate System. Photo by Yonhap News.

They further stated, "If the reintroduction of the Safe Freight Rate System leads to a sharp rise in export logistics costs, it will pose an additional hardship for our companies, which are already suffering a serious decline in export competitiveness due to recent U.S. tariff measures." They added, "The business community hopes that the National Assembly will conduct a careful review and thorough discussion of the bill so that the conditions of the freight market and the realities of the industry are fully reflected in the legislative process."

The Safe Freight Rate System is a policy that announces a minimum freight rate for truck drivers to ensure appropriate wages. The system was introduced temporarily for three years in March 2020 under the Moon Jae-in administration, but the Yoon Suk-yeol administration did not extend its expiration date. The Democratic Party of Korea sought to make the system permanent as soon as the 22nd National Assembly convened last year, but during the review by the Land, Infrastructure and Transport Committee's subcommittee on bill screening, it was revised to a three-year sunset clause.