Last Year, Newly Established and Strengthened Regulations Increased by 55% Year-on-Year... Highest Growth Rate in 10 Years

[Asia Economy Reporter Su-yeon Woo] It has been revealed that the number of newly established or strengthened regulations through government legislation last year reached 1,500. In terms of year-on-year growth rate, it increased by a staggering 55%, marking the highest level in the past decade.

On the 20th, the Federation of Korean Industries analyzed the regulatory review by the Regulatory Reform Committee and found that the total number of newly established or strengthened regulations through government legislation last year was 1,510, a 55% increase compared to the previous year. Among these, 96.4% were classified as non-important regulations and did not undergo the main review by the Regulatory Reform Committee, and 83.8% were stipulated in subordinate laws below enforcement ordinances that do not require parliamentary review.

Looking at the annual trend over the past 10 years, the highest number was in 2012 with 1,598 cases, followed by last year with 1,510 cases, ranking second. In terms of year-on-year growth rate, last year ranked first in the past 10 years with 55%, followed by 2016 (45.9%) and 2012 (28%), showing a pattern where regulations newly established or strengthened increase in the latter half of administrations.

Among the 1,510 newly established or strengthened regulations, only 3.6% (54 cases) were classified as important regulations after preliminary review and underwent deliberation and resolution by the main committee or subcommittees of the Regulatory Reform Committee. Only three cases of newly established or strengthened regulations received 'withdrawal recommendations' from the Regulatory Reform Committee.

In particular, it was confirmed that important laws affecting corporate management, such as the amendment to the Commercial Act and the enactment of the Serious Accidents Punishment Act, did not undergo review by the Regulatory Reform Committee. This is because the Commercial Act and legislations proposed by members of the National Assembly are not subject to regulatory impact assessments or review by the Regulatory Reform Committee under the Administrative Regulation Basic Act. Furthermore, legislation such as the class action law and punitive damages law currently being promoted by the government is proceeding without going through the regulatory impact assessment process, raising concerns in the business community.

The Federation of Korean Industries argued that to improve the unreasonable situation where laws that have a significant impact on corporate management activities do not undergo regulatory impact assessments, a more comprehensive regulatory impact assessment should be conducted for newly established or strengthened regulations. Additionally, it pointed out that the Commercial Act (government-initiated), which passed the National Assembly last year, is excluded from review under the Regulatory Reform Committee’s guideline 'Concept and Criteria for Administrative Regulations,' and the Serious Accidents Punishment Act does not undergo regulatory impact assessment because it is a member-initiated legislation, revealing loopholes in the regulatory review system.

Yoo Hwan-ik, Director of Corporate Policy at the Federation of Korean Industries, said, "Regulations that restrict the rights of citizens and companies or impose obligations should be created after thoroughly reviewing their impacts regardless of the legislative body or type of bill to minimize side effects." He added, "A comprehensive regulatory impact assessment system should be introduced to ensure that regulations under the Commercial Act and member-initiated legislation also undergo regulatory impact assessments, and the proportion of main committee reviews by the Regulatory Reform Committee should be increased to strengthen the current review system."

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