Regulatory Sandbox Revision... 'Temporary Approval' Granted Upon Safety Verification of 'Demonstration Exemption'

One Year Since Implementation, Comprehensive Development Plan to be Announced at the End of This Month

Flexible Application of Demonstration Exception Period... Various Options for Reduction and Extension Under Review

'Regulatory Sandbox No. 1' National Assembly Hydrogen Charging Station Rendering. (Reference photo)

[Sejong=Asia Economy Reporter Joo Sang-don] The government is promoting a plan to grant temporary permits when safety is confirmed through demonstration exceptions under the regulatory sandbox. Even if new products and new technologies are verified as 'safe' through demonstration exceptions, if commercialization is difficult due to other regulations, the government intends to allow immediate commercialization through temporary permits.

According to a senior government official on the 15th, the government plans to announce a comprehensive development plan containing these details at the end of this month, marking one year since the implementation of the regulatory sandbox.

The regulatory sandbox is a system that exempts or postpones existing regulations for a certain period when launching new products or services. If safety is proven during the test period and the need for regulation is deemed unnecessary, regulations are revised to enable new technologies and new products to be commercialized. It officially began with the enforcement of the Information and Communications Convergence Act and the Industrial Convergence Promotion Act on January 17 last year.

However, last year’s regulatory sandbox approvals were concentrated on 'demonstration exceptions (158 cases),' which exclude regulations to allow testing and verification of the safety of new products and new technologies. Even if safety is confirmed, market launch may be difficult due to other regulations.

Accordingly, the government has decided to grant temporary permits for new technologies and new products whose safety has been confirmed through demonstration exceptions to pave the way for commercialization. A government official explained, "The primary goal is to completely improve unnecessary regulations identified through demonstration exceptions to enable commercialization. However, if immediate legal improvements are difficult, we intend to allow market launch by granting temporary permits."

The demonstration exception period will also be made flexible. Currently, after a minimum period of 6 months, if the company’s test results show no safety issues, the business operator can request the government to end the exception and revise regulations. Even if safety verification is completed in 2 to 3 months, regulatory improvement work only begins after 6 months. Therefore, the government plans to remove the 6-month minimum rule to accelerate regulatory improvements.

Conversely, various options are being considered to extend the demonstration exception period. Currently, the maximum demonstration period per project is 2 years, with one possible extension through additional review. For projects where this period is insufficient, the government plans to increase the number of extensions by one more time or introduce a second demonstration exception period, thereby postponing regulation application for up to 4 years.

There is also discussion about mandating the participation of the relevant regulatory ministries in the analysis of demonstration results for projects granted exceptions. To lead to actual regulatory improvements, it is necessary to prove that the regulation is unnecessary, and including the related ministries from the beginning allows for prior coordination of opinions and narrowing of differences.

Earlier, on the 9th, the Office for Government Policy Coordination held a meeting where private, government, and academic experts jointly evaluated the regulatory sandbox’s performance over the past year and discussed future institutional development plans. Based on this, the government plans to finalize the comprehensive development plan and announce it at the end of this month.

This content was produced with the assistance of AI translation services.