Regulatory Innovation Forum Calls for Establishment of Regulatory Proof Responsibility System

KCCI to Hold the 1st Regulatory Innovation Forum on the 25th
Discussion on Business- and Market-Centered Regulatory Issues

Seoul Jung-gu Korea Chamber of Commerce and Industry. / Photo by Jinhyung Kang aymsdream@

According to the OECD (Organisation for Economic Co-operation and Development) Product Market Regulation (PMR) index, there is a call for the establishment of a regulatory proof-of-responsibility system to shed the stigma of being a regulatory laggard. The PMR is an index measuring regulatory intensity published by the OECD since 1998. Since the first survey, South Korea has consistently ranked within the top 9 most heavily regulated countries among 38 nations for 25 years. In the most recent 2018 survey, it even ranked 6th among the most heavily regulated countries.

The Korea Chamber of Commerce and Industry (KCCI) announced on the 25th that it held the first 'Regulatory Innovation Forum' at the Chamber of Commerce building to discuss regulatory issues centered on businesses and markets and to devise alternatives. The KCCI Regulatory Innovation Forum was established to strengthen public-private cooperation and enhance the perceived effectiveness of regulatory improvements by discussing regulatory issues from the perspective of businesses and exploring practical solutions.

Attending the forum were key executives from major associations, including Woo Tae-hee, Executive Vice Chairman of KCCI; Lee Jung-won, Deputy Minister of the Office for Government Policy Coordination; Jung Dong-chang, Vice Chairman of the Korea Petroleum Association; Choi Kyu-jong, Vice Chairman of the Korea Shipbuilding & Offshore Plant Association; Kim Jeong-hoe, Vice Chairman of the Korea Semiconductor Industry Association; Park Seong-ho, Chairman of the Korea Internet Corporations Association; Choi Seong-jin, CEO of Korea Startup Forum; Lee Kwang-young, Executive Director of the Korea Iron & Steel Association; and Kim Ju-hong, Executive Director of the Korea Automobile Manufacturers Association. Presentations were given by Kang Young-chul, Visiting Professor at KDI, and Won So-yeon, Head of the Regulatory Policy Research Office at the Korea Institute of Public Administration.

Desk-bound Regulations Threaten Business Survival... Importance of the 'Umunhyundap' (Our Problem Lies in the Field) Approach

Won So-yeon, who delivered the keynote presentation, stated, "Regulations that are unrealistic or irrational are restricting business activities and threatening the survival of companies. Even if the purpose and necessity of regulations exist, if the means impose excessive burdens on businesses, it could lead to their collapse." She also pointed out, "Although new industries are emerging and boundaries between sectors are dissolving, outdated and excessive regulations are causing new business opportunities to fail from the outset."

Kang Young-chul, the second presenter and KDI professor, said, "The facts proven by 25 years of regulatory reform show that regulatory officials do not understand the field well, without strong coordinators reforms remain minor adjustments, and truly important regulations are deferred to long-term reviews." He emphasized, "To improve desk-bound regulations made without understanding the field, the 'Umunhyundap' approach?meaning our problem has its answer in the field?is crucial."

Participants at the forum also voiced that regulatory difficulties in business sites continue to accumulate and urged for prompt resolution. Jung Dong-chang, Vice Chairman of the Korea Petroleum Association, said, "We plan large-scale investments in eco-friendly energy transition and carbon neutrality to secure global competitiveness, but face many difficulties due to regulations." Choi Seong-jin, CEO of Korea Startup Forum, added, "Although the government actively collects opinions on regulatory innovation, many cases see no progress during the review stage. We hope the government will show stronger will and expedite processing."

A KCCI official stated, "Not only KCCI but also various associations are gathering key regulatory improvement tasks," adding, "If necessary, we plan to submit joint petitions to the government."

Limitations of Existing Ministry-led Regulatory Improvements... Need to Establish a Private-sector Review-based Regulatory Proof-of-Responsibility System

Professor Kang said, "The current ministry-led regulatory improvement approach is reaching its limits," and added, "We need to consider new principles and alternatives that break away from the existing methods." He proposed a private-sector review-type regulatory proof-of-responsibility system where the private sector prepares and proposes improvement plans, ministries prove the necessity of maintaining regulations, and the Regulatory Reform Committee makes the final adjustments.

Woo Tae-hee, Executive Vice Chairman of KCCI and chair of the forum, emphasized, "Companies feel regulations not as a mere thorn under the fingernail but as a blade pressed against their necks," and said, "It is time to shed the stigma of being a regulatory laggard. Efforts such as a business-site-centered approach rather than simple case counts, swift improvements, and the establishment of a regulatory proof-of-responsibility system that respects the original intent of regulations are important."

Meanwhile, KCCI plans to continuously hold forums to discuss regulatory issues and improvement measures in key areas such as location, environment, and new industries, seeking regulatory difficulties and alternatives from the perspective of businesses and markets.

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