The Computer & Communications Industry Association (CCIA) has expressed disappointment over a recent legislative proposal in Korea. The proposed regulation targets specific companies operating within Korea's digital marketplace, including major U.S. firms. The legislation aims to prohibit certain business practices that competing Korean and Chinese firms would still be allowed to employ. This move raises concerns about Korea's trade obligations under agreements such as the U.S.-Korea Free Trade Agreement (KORUS).
Introduced on October 28, the new legislation aligns with goals previously outlined by the Korea Fair Trade Commission (KFTC) on September 9, which had also drawn comments from CCIA.
The CCIA argues that the focus on U.S. companies and their online services in Korea is inappropriate for a dynamic digital market like Korea’s. They suggest that targeting these firms could place them at a competitive disadvantage against rapidly expanding Chinese competitors. Before proceeding further with this bill, the CCIA recommends that the Korean Government, along with the KCC and MSIT, engage with stakeholders from both public and private sectors to evaluate the current regulatory framework and assess potential impacts of this proposal.
Matt Schruers, President & CEO of CCIA, stated: “This newly proposed regulatory bill retains many of the counterproductive features of previous bills, including applying thresholds and definitions that have a disproportionately negative impact on U.S. companies.”
He further urged Korean policymakers: “We urge Korean policymakers and legislators to abandon proposals that would target U.S firms and exacerbate the risk of Chinese influence on the essential U.S.-Korean economic and security relationship. Importing experimental regulations from Europe represent solutions in search of a problem, and are counterproductive in a digital economy powerhouse like Korea.”
