US firms escalate opposition to Korea's new corporate regulations

American Chamber of Commerce in Korea (AMCHAM) Chairman James Kim, left, listens to Trade Minister Yeo Han-koo, right, during a roundtable meeting at AMCHAM's office in Seoul, Friday. Yonhap

U.S. business leaders in Korea are increasing efforts to prevent the government and the ruling Democratic Party of Korea (DPK) from advancing the proposed amendment to the Commercial Act and the revision of the Trade Union and Labor Relations Adjustment Act, better known as the “yellow envelope law.”

Following a closed-door roundtable discussion on Friday with Trade Minister Yeo Han-koo, the American Chamber of Commerce in Korea (AMCHAM) said senior executives from its member companies talked about the difficulties their businesses are facing in Korea.

“Participants shared insights from firsthand experience operating in Korea and offered recommendations aimed at improving the country’s investment environment and business competitiveness,” the largest foreign chamber of commerce in Korea said in a press release.

The roundtable was initially arranged to discuss a recent tariff agreement signed between Korea and the U.S. and to explore opportunities for strengthening bilateral economic cooperation. During a dialogue open to the press, AMCHAM Chairman James Kim outlined the chamber’s plan to pursue the “Buy America” campaign in broader sectors, including artificial intelligence, while the trade minister pledged a dedicated “U.S. Help Desk” to address U.S. firms' concerns about nontariff barriers.

American Chamber of Commerce in Korea (AMCHAM) Chairman James Kim, left, shakes hands with Rep. Song Eon-seog, the floor leader of the main opposition People Power Party, during their meeting at the National Assembly in Seoul, Thursday. Yonhap

A day earlier, Rep. Song Eon-seog, the floor leader of the conservative main opposition People Power Party, told reporters that the AMCHAM chairman said the chamber would inform the trade minister, the industry minister and the ruling party of global companies’ concerns over the proposed bills.

After his meeting with Kim at the National Assembly Thursday, Song said that AMCHAM is especially concerned about a possible outflow of companies and workforce from Korea — an outcome that could hamper efforts to make the nation a global business hub like Singapore or Hong Kong.

“As an organization that remains nonpolitical and neutral, AMCHAM raised concerns about Korea’s legislative process,” the lawmaker said.

Late last month, AMCHAM issued a statement expressing concerns about the Trade Union Act revision, which would empower subcontracted workers to negotiate directly with their employers’ clients, while prohibiting management from seeking compensation for damages caused by some labor strikes.

AMCHAM’s statement followed a similar warning from the European Chamber of Commerce in Korea, which cautioned that the proposed bill may prompt foreign companies to withdraw from the Korean market.

The Korean Confederation of Trade Unions, however, called the concerns baseless.

“AMCHAM’s call for a ‘flexible labor environment’ is just an old excuse to place the burden on workers,” the confederation said in an Aug. 4 statement. “We will not sit by and accept the arrogant claims made by foreign chambers of commerce.”

The government and the ruling party remain firm on the stricter regulations. Holding a majority in the National Assembly, the DPK plans to pass the bills when the next plenary session begins Aug. 21.