The 'Cargo Truck Safety Freight Rate System' Turned into a Den of Corruption... Still Rife with Evasion and Illegality

Using Loopholes and Illegal Methods to Recover Reduced Amounts, Enduring the 3-Year Sunset Rule
Disadvantages Arise When Identity Is Revealed Upon Reporting... Reporting Center 'Ineffective'

[Asia Economy Honam Reporting Headquarters, Reporter Yoon Jamin] Although the Safe Freight Rate System has been implemented in the freight transportation market since this year, it has been revealed that some truck owners and transportation operators are undermining the system by resorting to loopholes and illegal activities to endure the three-year sunset clause.

According to Cho O-seop, a member of the National Assembly’s Land, Infrastructure and Transport Committee from the Democratic Party (Gwangju Buk-gu Gap), the number of truck accidents in the past three years has shown an increasing trend: 27,341 cases in 2017, 27,562 in 2018, and 28,788 in 2019.

The number of deaths and injuries were 961 and 41,157 respectively in 2017, 868 and 41,636 in 2018, and 802 and 42,960 in 2019, averaging 877 deaths and over 42,000 injuries annually.

In response, the Ministry of Land, Infrastructure and Transport (MOLIT) implemented the “Freight Safe Freight Rate System” this year to improve the working conditions of freight transportation workers who are exposed to risks such as overwork, overloading, and speeding due to low freight rates by announcing the minimum freight rates that truck owners should receive.

However, since the Safe Freight Rate System is implemented with a three-year sunset clause, freight owners and transportation operators who were cautious at the beginning of the implementation have been found to engage in illegal fee claims, collusion between companies, establishment of new additional costs, back margins, and minimum bidding systems since March of this year.

A survey conducted by the “Public Transport Union Freight Solidarity” targeting 475 container freight union members revealed that 248 members, more than half of the total, experienced violations of the Safe Freight Rate System.

By major violation types (including overlaps), illegal fee collection accounted for 45% (215 people), cost increases 29% (142 people), non-payment of safe freight rates 33% (158 people), and non-compliance with ancillary provisions 36% (175 people).

The fact that more than half of the union members under the protection and oversight of the union reported violations suggests that the actual situation for non-unionized general freight workers is likely more severe.

As of the end of August 2020, only 816 cases of Safe Freight Rate violations were reported to the “Freight Safe Freight Rate Reporting Center” operated by the Korea Transportation Safety Authority (commissioned by MOLIT).

Among these, 316 cases were notified to the relevant local governments, 393 cases were under document review, 22 cases were withdrawn, and 85 cases were closed internally, but there have been no administrative actions such as fines to date.

Considering that the total number of container and cement freight trucks subject to the Safe Freight Rate System in 2019 was about 26,000, this is an extremely low figure.

Moreover, out of the 10 personnel at the reporting center, only two regular employees and one intern are dedicated staff, while six call center counselors handling freight transportation performance and the center director are multitasking.

It has also been pointed out that the system’s weakness, where the reporter’s real name is revealed during the fact-checking process, significantly undermines the authority of the reporting center.

Assemblyman Cho O-seop said, “The Safe Freight Rate System was originally limited to only two sectors, container and cement, and since it is implemented with a sunset clause, transportation operators are forming a trend to endure only for three years through various loopholes and illegal activities. We need to expand the applicable sectors and abolish the sunset clause to send a strong message about the sustainability of the Safe Freight Rate System and the government’s commitment.”

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