Fair Trade Commission announced a three-year cut in Bae Min's fees and will also make efforts to implement win-win measures in the gift certificate sector.

■ Broadcast: YTN Radio FM 94.5 (09:00-10:00)
■ Host: Reporter Cho Tae-hyun
■ Air date: January 22, 2025 (Wednesday)
■ Talk: Director of Competition Policy Hong Hyung-joo at the Fair Trade Commission

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information.
◇ Reporter Cho Tae-hyun (hereinafter referred to as Cho Tae-hyun): Looking back on last year. There were quite a few economic issues, including the Timef crisis, the fee issue of delivery apps, and the combination of Korean Air and Asiana. And the FTC will inevitably be in the process of managing and solving these issues. In today's fair economy talk session, we will listen to the FTC's work plan for 2025. This is connected to the phone of Hong Hyung-joo, head of the FTC's competition policy division. Is the manager out?

◆Hyung-Joo Hong, Director of Competition Policy Division, Fair Trade Commission (hereinafter referred to as Hong Hyung-Joo): Yes, hello, nice to meet you.

◇ Cho Tae-hyun: Yes, how are you? It's already been almost a month since the new year, so what areas is the FTC focusing on this year?

◆Hong Hyung-joo: The situation our economy is facing this year is not easy. As you know well, high prices have accumulated, and internal and external uncertainties have also increased. The economy that the people feel is very difficult. In addition, it is urgent to find new growth engines because major industries are slowing down a lot. So, when the FTC reports this year's work plan to the acting president, it has established a work plan around two policy goals: the recovery of the people's livelihood and future preparation.

◇ Cho Tae-hyun: The recovery of the people's livelihood and preparation for the future. In particular, the recovery of the people's livelihood and the sluggish construction industry are also having a huge impact on the domestic economy and domestic demand industry. I heard there is an improvement plan related to the subcontract improvement payment in the construction industry, what is it about?

◆ Hong Hyung-joo: Recently, the construction industry has stagnated a little, so there are many concerns that subcontractors will not receive payment even if they work hard. As you know well, the subcontracting transaction structure usually continues to be the orderer, the original operator, and the subcontractor, but the subcontracting law now prepares for the case that the original operator cannot pay the payment to the subcontractor. There are systems such as 'payment guarantee system' and 'direct payment system'. So this year, we are trying to supplement this system a little more to reduce the reasons for exceptions to payment guarantees or to improve the system to expand the scope of direct payment. In addition, the subcontract delivery unit price linkage system has been introduced and implemented, and this year, we plan to focus on illegal activities such as forcing an agreement not to sign a linkage contract.

◇ Cho Tae-hyun: Okay. I hope these measures will help the construction industry recover even a little. Last year, the 'Timpe incident' hit the e-commerce market and the travel industry very hard. I heard that we have prepared measures to prevent the same accident from occurring and that we are pushing for the measures in earnest this year, what is it about?

◆Hyungjoo Hong: That's right. As you said last year, the difficulties of the stores were very large and the social impact was also great. So, the government has prepared related measures to prevent the recurrence of this situation. It is called the ｢Large Distribution Business Act｣ that contains the measures. The amendment to the Distribution Business Act was proposed to the National Assembly in October last year. The FTC plans to actively participate in and support parliamentary discussions so that the bill can be passed by the National Assembly as soon as possible this year. In addition, for traditional retail businesses such as large discount stores, the current payment settlement deadline is usually 60 to 40 days, and many people use online shopping malls after reviewing whether this deadline is too late. For online shopping malls, we will focus on checking whether there are unfair activities such as delayed payment or passing on promotional costs to the store company.

◇ Cho Tae-hyun: Okay. There is something we dealt with a lot last year, such as the fee problem of the delivery app, the table order system, and the no-show problem, which can be very fatal to small business owners. What are the measures for this year?

◆Hong Hyung-joo: Last year, our government and industry put their heads together to come up with a win-win plan in the delivery app and mobile gift certificates to help small business owners. I had some good news this morning. Baedal Minjok has announced that it will cut brokerage fees for the next three years. I understand that Coupang Eats is also preparing, and we will prepare for such a win-win plan to be implemented quickly in the mobile gift certificate field soon. And as you said, there are very chronic difficulties when self-employed people operate. Representatively, we call it 'restaurant technology' that automatically processes reservations, orders, and payments recently. We will carefully examine whether there are any unfair practices related to restaurant technology through a survey. And the second time you booked a restaurant and suddenly canceled it, so this is usually called 'no show'. The damage to self-employed people is not easy. Therefore, if you look at the consumer dispute resolution standards operated by the FTC, the penalty is uniformly stipulated at 10%, and since the actual conditions are different for each industry, we are also trying to push for realization according to the actual conditions of each industry. Next, many online advertising agencies use it to promote the store, but they often refuse to refund it even if they apply for a refund because they don't perform the contract properly or they don't. Therefore, in order to prevent such damage cases, we plan to establish standard terms and conditions for related terms and conditions and check unfair practices.

◇ Cho Tae-hyun: Okay. We've heard about various measures. So far, we have looked at how to respond to and solve the issues that occurred last year, but this time, I will ask you about the regulations and tasks you are planning to prepare this year. What kind of things do you have?

◆Hong Hyung-joo: The front part is related to the economic recovery that people feel. Second, the second keyword mentioned earlier is the urgent need to create a new growth engine for our economy and promote market innovation. These are the related contents. First of all, we plan to intensively check the four areas, such as health, safety, and food, clothing, and shelter, to see if there are collusion that directly leads to the economic burden of the people. In major industries such as telecommunications, automobiles, semiconductors, and high-tech strategic industries, we will strengthen monitoring for unfair practices such as technology use that hinder innovation and competition by small and medium-sized venture companies. And above all, a bill has now been proposed to quickly block anti-competitive behavior on giant monopoly platforms. It is an amendment to the Fair Trade Act. I plan to actively participate in this parliamentary legislative discussion.

◇ Cho Tae-hyun: Okay. We've heard about various measures for the future. Another of Korea's most chronic problems is the most serious problem, and the low birth rate and aging population is also the problem, so what are some measures you are preparing for this?

◆ Hong Hyung-joo: It's the most urgent problem and all government departments have to work together to solve it. As you know, the FTC plans to prepare and focus on measures to promote consumer rights and interests in areas where each generation is interested, such as marriage and daily life, as the main consumer ministry. First of all, regarding the youth. There are many prospective newlyweds who are struggling with the cost of preparing for their wedding to the point where the word "wedding inflation" has recently emerged. Listening to you, many people say that the biggest complaint is that the price information is opaque. That's why the Fair Trade Commission calls it 'Sudmeh' this year. We are also preparing to enact standard terms and conditions that provide price information related to studios, dresses, and makeup in a timely manner through our consumer service site and require marriage preparation agencies to explain detailed prices for each item. Next, we will focus on the areas of close daily life related to the middle-aged. For example, Korean Air Asiana will thoroughly supervise whether it combines companies and then increases mileage or plane ticket prices unfavorably or excessively. We will also make efforts to enact standard terms and conditions so that there is no damage to the gym. Lastly, for elderly consumers, we plan to actively promote regulatory improvement to resolve the inconveniences they experience in their daily lives. For example, there are many elderly people in wheelchairs. To make it easier to move, we would like to look at regulations related to transportation and improve them in collaboration with related ministries.

◇ Cho Tae-hyun: So far, I've heard a lot of policies that are close to life. In fact, should I say that the FTC is the most important role? Should I say it's the role that stands out the most? We can't leave out the policies for large corporate groups. What are the tasks related to this year?

◆Hyung-Joo Hong: Regarding the designation of large corporations, we will first thoroughly monitor unfair internal transactions as we have always done. This year, in particular, there are small and medium-sized businesses-focused industries where many small and medium-sized companies are entering, such as the restaurant industry and the building management industry. We will intensively monitor unfair internal transactions in such industries and areas close to people's livelihoods such as real estate and medical care. And since the economy has grown a lot in relation to the system, the criteria for designating business groups subject to disclosure have continued to be fixed at more than 5 trillion won in total assets of affiliates. We are planning to change this to a way that links it to GDP. In addition, the business group plans to promote various system improvements to reduce the burden of companies submitting data.

◇ Cho Tae-hyun: Okay. Lastly, what would you like to say to the listeners?

◆Hong Hyung-joo: I think the most important thing right now is speed and sensitivity. This year, the FTC will work hard on the aforementioned tasks one step faster so that the people can feel the tangible results in their lives.

◇ Cho Tae-hyun: Okay. So far, I've heard more about this year's business plan with Hong Young-joo, head of the Fair Trade Commission's competition policy division. Thank you for talking today.

◆Hyungjoo Hong: Thank you.