Economic Sector: "Regulations Arise Overnight... Total Cap on Regulatory Costs Urgently Needed"

Full-scale Battle Ahead of Bill Review
Legal Reforms Still at a Standstill

[Asia Economy Reporter Sung Ki-ho] With just over a month left until the end of this year's regular National Assembly session, the ruling and opposition parties have entered a 'legislative war' to pass key bills. In particular, a large number of bills that tighten regulations on companies, such as the 'Three Corporate Regulation Laws (Commercial Act, Fair Trade Act, Financial Group Supervision Act),' are awaiting review, raising concerns among businesses. While the business community points out the need for a 'total regulatory cost system' to establish systematic regulation management and a predictable business environment, legal reforms remain at a standstill.

According to political and economic circles on the 2nd, the Democratic Party of Korea and the Korea Chamber of Commerce and Industry will hold a public forum on legislative issues including the Three Corporate Regulation Laws at the National Assembly on the afternoon of the 3rd. The business community views this forum as the last public opinion gathering before the legislative review and plans to focus on conveying their positions and proposing alternatives.

The reason the business community is making such an all-out effort is that, in the 21st National Assembly, numerous anti-business bills are being introduced in addition to the Three Corporate Regulation Laws. Representative regulatory bills include the bill prohibiting the deployment of replacement workers by the primary contractor during subcontractor strikes (proposed by Woo Won-sik of the Democratic Party), the bill requiring severance pay after just one month of work (proposed by Lee Soo-jin of the Democratic Party), and the bill mandating higher wages for non-regular workers than regular workers (proposed by Yoon Joon-byung of the Democratic Party).

The problem is that there is no means to prevent such bills during the legislative process. According to the Korea Industrial Federation Forum, major advanced countries such as the United States, Germany, the United Kingdom, and France have regulatory brakes such as bill adjustment procedures and regulatory review agencies and processes, but South Korea has none. This is why the business community continues to call for regulatory relaxation mechanisms. Before the launch of the 21st National Assembly, the Federation of Korean Industries requested the legal establishment of the 'One in, Two out' system, which removes two regulations for every new one introduced, the 'Reduction Target System,' which forces ministries to cut allocated regulatory costs, and the 'Total Regulatory Cost System,' which requires abolishing or easing existing regulations equivalent to the cost incurred when new regulations are introduced or strengthened.

Legislation to supplement this is also slow. In August, Song Eon-seok, a member of the People Power Party, proposed two related bills to introduce the Total Regulatory Cost System, but they have yet to be submitted to the bill review subcommittee. These bills were also proposed by Song in the 20th National Assembly but were discarded due to lack of discussion and expiration of the term. This contrasts with the swift submission of other regulatory-related bills to subcommittees after their proposal.

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