"National Assembly Regulatory Legislation Requires Prior Impact Assessment and Process for Gathering Diverse Opinions"

Jung Manki, Chairman of the Korea Automobile Manufacturers Association. Photo by Mun Honam munonam@

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[Asia Economy Reporter Kiho Sung] In the automotive industry, there have been claims that it is necessary to gather opinions related to regulations during the legislative process in the National Assembly concerning regulatory reform. The intention is to take a closer look at how regulatory bills might impact the industry before proceeding with legislation.

The Korea Automobile Industry Association (KAIA) held an online seminar on the 16th under the theme of "Improvement of Automobile-Related Regulations."

In his opening remarks, KAIA Chairman Manki Jeong stated, "It is necessary to provide the industry with sufficient preparation time when policy authorities enact or amend laws and regulations," adding, "Providing at least three years of preparation time from the date of promulgation to enforcement will allow companies to improve their adaptability to regulations."

He continued, "The automotive sector involves many government ministries related to regulations, so even if a single regulation is reasonable, when multiple regulations are implemented simultaneously, overlapping or conflicting contents among regulations may cause confusion in research and development. Therefore, during the legislative process, close consultations between government ministries or between the government and the National Assembly are required to harmonize regulations."

Yongwon Kim, Director of the Korea Automobile Manufacturers Association (KAMA), in his presentation on "Directions for Rational Improvement of Automobile Safety and Environmental Regulations," said, "Unlike government legislation, member-initiated legislation lacks prior procedures such as impact assessments on small and medium-sized enterprises and regulatory reviews. As a result, regulations difficult to pursue through government legislation are sometimes bypassed through member legislation." He argued, "To prevent indiscriminate proliferation of regulations, a system should be established and operated within the relevant standing committees of the National Assembly to analyze and provide opinions on regulatory overlaps, the appropriateness of delegated regulatory scopes, and impacts on other industries (committees) before discussing proposed or amended bills."

Furthermore, he emphasized, "When regulations are newly established in laws, the executive branch stipulates specific details to implement them (administrative regulations). Since the industry is greatly affected by administrative regulations, companies are very sensitive to their introduction and operation. However, there is no system to raise objections even if the authoritative interpretation by the responsible official of the relevant ministry is unclear. Therefore, when there is a difference in interpretation between ministry officials and companies, a system should be established to provide authoritative interpretations from a third-party perspective within the executive branch before judicial procedures."

Kangsik Kim, Professor of Business Administration at Korea Aerospace University, in his keynote presentation on "Transition to Future Cars and Regulatory Improvement," mentioned labor-related regulations, stating, "Korea's regulations on labor and labor-management relations are among the strictest in the world, and as a result, Korea's labor market competitiveness ranks among the lowest globally (outside the top 100 in most labor and labor-management relation categories in the WEF national competitiveness evaluation of 141 countries)." He argued, "The automotive industry faces issues such as low labor productivity, high labor costs, low labor flexibility, and adversarial labor-management relations. Current labor regulations and systems become critical obstacles in electric vehicle production, where labor input decreases by 62% compared to conventional internal combustion engines."

He also pointed out that domestic regulations are excessively rigid and stressed the urgent need to secure flexibility that revitalizes the labor market and economy. He said, "It is necessary to change the total working hours regulation unit from the current weekly basis to monthly or yearly units, expand the flexible working period under the flexible work system, and relax restrictions on dispatched and fixed-term work and their duration."

Additionally, he emphasized, "The introduction of general dismissal, easing conditions for managerial dismissal, transitioning from seniority-based pay to job-based or performance-based pay systems, and improving the minimum wage system are necessary. It is also important to recognize replacement labor during strikes, introduce unfair labor practice regulations for labor unions, delete or ease criminal penalties, prohibit workplace occupations, and extend the validity period of collective agreements to balance bargaining power between labor and management."

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