USTR Mentions 'Google Gapjil Prevention Act' in Trade Barriers Report... Also Covers Mobile Phone Market Issues

[Asia Economy Reporter Seulgina Jo] The United States Trade Representative (USTR) included content about South Korea's so-called 'Google Gapjil Prevention Act,' currently being promoted in the National Assembly, in its annual National Trade Estimate (NTE) report, which is used as a tool for trade pressure. The report also claimed, citing complaints from domestic companies, that Korean regulatory authorities are helping domestic smartphone sales.

According to the USTR on the 31st (local time), the report, released for the first time under the Joe Biden administration, contains 13 pages of content related to South Korea. This is one page more than last year's report.

First, the USTR noted that the Korean National Assembly is discussing a bill that prevents app market operators such as Google Play Store and Apple App Store from mandating in-app payments, evaluating that "it appears to be specifically targeted at American companies." It also argued that "in-app payments have been established by the market" and that "the bill could threaten the standard American business model." Furthermore, it added the position that "it is uncertain how the maintenance costs of app markets without integrated payment services can be covered."

The USTR also mentioned issues in the smartphone market under the market competition practices section. It stated that there are industry complaints that Korean regulatory authorities use enforcement power to increase sales of domestic companies at the expense of American competitors. However, it did not specify how the Korean government helped increase companies' sales. As of last year, Samsung Electronics holds an overwhelming 65% market share in the domestic smartphone market, followed by Apple and LG Electronics with 21% and 13%, respectively.

Additionally, the USTR noted regarding changes such as the amendment of the Fair Trade Act last year and related regulations on access to corporate confidential information that "the United States will continue to monitor the enforcement status of the amendment process."

Regarding sanitary and quarantine issues related to chicken and beef trade, the report mentioned that South Korea's Ministry of Food and Drug Safety excluded U.S. meat facilities from export approval after detecting residues of ractopamine in U.S. beef, arguing that the standards are stricter than international norms. Ractopamine is a growth promoter used in animal feed.

The USTR's annual National Trade Estimate report investigates and summarizes trade barriers by country. Since it mainly contains the U.S. perspective on trading partners and issues that may cause future conflicts, it has been used as a means of trade pressure. The USTR publishes the trade barrier report annually in accordance with Section 181 of the Trade Act.

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