Additional Support under the Handset Distribution Act Increased from 15% to 30%... Official Announcement Days Are Tuesday and Friday

KCC Approves at 44th Plenary Meeting
Legislative Review and Cabinet Approval Pending

[Asia Economy Reporter Cha Min-young] The cap on additional subsidies that smartphone retailers can provide will be doubled from the current 15% to 30%.

On the 7th, the Korea Communications Commission (KCC) held the 44th plenary meeting and approved amendments to the "Act on the Improvement of Distribution Structure of Mobile Communication Terminals" and the "Detailed Standards on the Disclosure and Posting Methods of Subsidies."

First, the Act on the Distribution of Mobile Devices will be amended to raise the cap on additional subsidies that retailers can provide from the current 15% to 30%, doubling the limit.

Currently, retailers can only provide additional subsidies to users within 15% of the publicly announced subsidy, but some branches have been providing illegal subsidies, raising concerns that the additional subsidy limit should be increased to a reasonable level.

Additionally, the days for mobile carriers to change their publicly announced subsidies will be designated as Tuesday and Friday, shortening the minimum disclosure period from the current 7 days to 3-4 days.

Originally, mobile carriers maintained the subsidy announcement for 7 days to prevent user confusion and could change it at any time. However, users found it difficult to predict changes in the publicly announced subsidies, and when one carrier raised its subsidy, others could immediately follow, which was seen as hindering competition.

The KCC plans to submit the final draft to the National Assembly after Cabinet approval, as the increase in the additional subsidy cap is an amendment to the Mobile Device Distribution Act. The process includes review by the Ministry of Government Legislation in October, Cabinet approval in November, and presidential approval and submission to the National Assembly in December.

The partial amendment to the detailed standards on the disclosure and posting methods of subsidies (notification) will be implemented in October after a preparation period for operators.

Chairman Han Sang-hyuk of the KCC said, "Regarding the Mobile Device Distribution Act, there are always conflicting views between applying the law more strictly and relaxing it to promote market competition," adding, "Finding a balance is a point the commission needs to consider." He also called for consideration of measures to minimize market side effects.

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