Korea set to introduce new antitrust legislation for Big Tech

South Korean antitrust regulators are gearing up to unveil new antitrust legislation targeting big tech firms in February 2024 amid opposition from critics who said the proposed act does not meet their needs.

The Fair Trade Commission (FTC) is leaning towards regulating only four or five dominant tech firms under the Platform Fair Competition Promotion Act, or Platform Act, sources familiar with the matter said on Monday.

The Platform Act sets specific criteria such as revenue, market share, and user numbers to identify dominant operators, who could then face fines of up to 10 percent of their revenues for violating rules on preferential treatment, discrimination, and other antitrust practices.

Korea targets could include Naver Corp. and Kakao Corp. alongside non-Korean ones such as Google Inc. and Apple Inc., with potential exclusions for Coupang Inc. and Woowa Brothers Corp.

While the legislation aims to prevent digital platform monopolies, tech industry executives and small enterprises both said it does not represent their needs.

Small firms called for broader inclusion, which involves regulations on Korean distribution and delivery platforms such as Coupang and Woowa Brothers, along with popular Chinese online shopping retailers. Critics from the tech sector argue that the Platform Act is excessive regulation, which can lead to disadvantages for Korean companies.

The antitrust watchdog aims to target a limited number of companies, describing them as “global platforms with revenues comparable to small countries’ national budgets,” which explains why industry executives indicated Coupang and Woowa Brothers might not be included in the list of dominant platforms.