Lee Jae-myung: "Platform Markets Must Be Regulated to Ensure Fair Competition... Legislation Urgent"

[Suwon Ilbo=Reporter Park Nohun] Gyeonggi Province Governor Lee Jae-myung said that in the digital economy era, appropriate regulations on platforms, which are essential infrastructure, must be implemented to enable fair competition.

Governor Lee made the remarks in his welcoming address at the 'Measures to Prevent Online Platform Market Monopoly Discussion Forum' held at Ireum Center in Yeouido on the 24th, saying, "The global economic order is entering a new era of technological revolution through the so-called digital economy and platform economy," and "The current situation is similar to certain individuals or companies monopolizing important infrastructure such as the Gyeongbu Expressway or Yeongdong Expressway and arbitrarily collecting tolls."

He continued, "We need to approach the platform economy and digital economy as a new era and new business," and emphasized, "Just as we have regulated large-scale retail outlets through legislation, it is important to make platforms corresponding to digital economy infrastructure engage in genuinely fair competition through appropriate regulation."

He added, "On behalf of the province's residents, I particularly urge you to proceed with legislation as soon as possible to prevent some who monopolize the platform economy from illegitimately taking the fruits of many people's efforts."

The discussion forum, jointly hosted by Gyeonggi Province and 21 lawmakers (Kang Deuk-gu, Go Young-in, Kwon Chil-seung, Kim Nam-guk, Kim Byung-wook, Kim Han-jeong, Min Hyung-bae, Park Sang-hyuk, Park Jeong, Seo Young-seok, Song Gap-seok, Yong Hye-in, Yu Ui-dong, Yun Hu-deok, Lee Gyu-min, Lee Dong-ju, Lee So-young, Lee Yong-woo, Lim Jong-seong, Jung Sung-ho, and Hong Ki-won, in alphabetical order), was attended by approximately 40 stakeholders including platform damage case presenters, experts, business groups, and central government officials. The forum was streamed live through the province's social media channel Live Gyeonggi (live.gg.go.kr), with in-person attendance minimized to maintain social distancing.

The forum was chaired by Kang Shin-ha, head of the Gyeonggi Province Fair Economy Committee (attorney), with Kim Ji-ye, head of Gyeonggi Province's Fair Economy Division, first presenting the results of a 'Delivery App Trading Practice Fact-Finding Survey' jointly conducted by the Capital Region Fair Economy Council (Seoul, Incheon, and Gyeonggi).

Director Kim said, "According to a survey of 2,000 delivery app franchisees in the capital region, 72.9% of respondents reported feeling significant burden from advertising fees and commissions paid to delivery app companies, and indicated a desire for a commission rate of around 5%," and "As delivery apps increase commission hikes or events and coupons to induce orders, the burden on self-employed business owners increases, which is ultimately passed on to consumers through higher delivery fees or food prices."

Subsequently, Kim Young-sik, director of the Gyeonggi Individual Taxi Transportation Union, introduced the issue of dominance transfer by Kakao T, and attorney Eom Tae-seop presented damage cases of platform users including Coupang's item winner policy. Additionally, Kang Seon-hee, head of Gyeonggi Province's Distribution Fair Trade Team, conducted a comparative review of the currently discussed 'Fair Platform Transaction Act,' and Jung Ji-yeon, secretary general of the Korean Consumer League, made 'consumer awareness results on delivery app usage and legislative recommendations for consumer rights protection related to the Fair Platform Transaction Act.'

Discussants unanimously agreed that the current period of rapid growth in the online platform market is the time to establish basic measures to prevent abuse of online platform status and strengthen market transparency.

Professor Na Jong-yeon from Seoul National University stated, "Since consumers are also an important group in platform ecosystem composition, regulation of platforms should protect consumer basic rights and lead to enhanced consumer utility."

Professor Jo Chun-han from Gyeonggi Science and Technology University said, "Platform operators' roles must simultaneously pursue profits and consider consumer welfare. That is why they differ from general shopping mall operators," and "It is highly encouraging that the Fair Online Platform Act has been introduced in the 21st National Assembly."

Additionally, Kim Jong-min, secretary general of the Franchisee Council, stated, "To protect the rights of platform users, it is necessary to establish a social consensus body among stakeholders and establish fair rules for online mobile transactions."

Gyeonggi Province enacted the 'Gyeonggi Province Ordinance on Fair Platform Transactions in Distribution' in July to promote transaction fairness in the rapidly changing distribution market, and jointly conducted the 'Delivery App Trading Practice Fact-Finding Survey' presented at the forum with Seoul and Incheon. Going forward, based on the discussion forum and other efforts, Gyeonggi Province plans to establish a 'Comprehensive Distribution Platform Plan' and prepare basic measures to protect users participating in platform transactions from monopoly and unfair trade practices.