Delivery App 5% Commission Plan Nears Agreement... Hardline Groups Remain a Variable

Platform-Focused Win-Win Proposal Raised at Social Dialogue Body

Positive Response from Small Business Organizations

Variables Remain Due to Hardline Stance from Some Groups

As the social dialogue body aimed at easing the commission burden of delivery applications (apps) has resumed operations, active discussions are underway regarding the proposal to set the commission rate in the 5% range. This proposal was initially put forward by the platform industry during the first meeting, and it is reported that major small business associations have since responded positively, accelerating the momentum. With attention now focused on the possibility of a win-win solution emerging at the second meeting scheduled for April 27, there are also concerns that the hardline stance of some organizations could become a variable affecting the outcome.

According to political circles and industry sources on April 22, small business associations participating in the social dialogue body on delivery apps, organized by the Democratic Party's "Committee for the Practice of Protecting the Underdog" (Euljiro Committee), held a separate meeting on April 20 to discuss this proposal. It is reported that all key small business associations—including the Korea Federation of Micro Enterprises and the Korea Merchant Association, both of which did not attend the first meeting on April 10 due to differences in opinion—participated in this meeting.

The participating organizations reportedly confirmed their positions on issues such as commission fees, delivery charges borne by business owners, and pricing structures linked to distance limitations. The current commission structure for the industry’s top two platforms, Baedal Minjok and Coupang Eats, applies intermediary commissions ranging from 2.0% to 7.8% depending on the transaction amount, while delivery fees vary from 1,900 to 3,400 won. This structure was formulated through a cooperative council between delivery platforms and participating businesses in 2024. In addition, the newly proposed plan at the social dialogue body suggests lowering the intermediary commission rate to the 5% range, depending on the delivery distance.

According to industry sources, the core of this plan is to reduce the intermediary commission rate to the 5% range—down from the current 4km delivery radius—while also lowering the maximum delivery fee for businesses from 3,400 won to the 2,000-won range. This pricing model would be available for businesses choosing to offer short-distance deliveries. The industry estimates that more than 60% of orders are placed within approximately 1km.

Most small business associations view this proposal, which was suggested by Baedal Minjok and reportedly agreed upon in principle by Coupang Eats, as beneficial. In particular, given that small businesses are facing increasing difficulties due to soaring prices of packaging materials caused by the Middle East conflict, they are urgently seeking alternatives that can be implemented immediately, rather than prolonged discussions. Namsoo Cha, Policy Director of the Korea Federation of Micro Enterprises, said, "The newly discussed pricing model provides more options and enables price reductions, which is viewed positively. There is also hope that a pricing structure reflecting the perspectives of small businesses will emerge in the future."

The small business associations plan to continue coordinating their positions to approach the issue of delivery app commissions from an independent standpoint. However, with various factors still in play, it remains uncertain whether concrete results will be produced at the second meeting. The biggest obstacle is that some organizations continue to demand a commission cap system to ensure that the total commission—including intermediary commissions, delivery fees, payment processing fees, and value-added tax—does not exceed 15%. There are also ongoing calls for changes to the structure of free delivery services, which have been competitively promoted by delivery apps. An industry representative stated, "A gradual approach is needed to provide practical support to a majority of small businesses while ensuring that no participating company is placed at a disadvantage."

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