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| Fair Trade Commission Chairperson Cho Sung-wook speaks at a meeting of the State Affairs Committee at the National Assembly in Yeouido, on Aug. 30. Korea Times file |
By Kim Jae-heun
The country's top antitrust watchdog said that it will toughen rules on major technology companies after financial authorities decided recently to regulate the fintech businesses of platform operators.
Once hailed as high-tech innovators, the founders of Kakao, Naver and other on-line companies have been increasingly viewed as money-hungry tycoons, as they have been gobbling up the market shares in an increasing range of industries, ranging from delivery to transportation, only to hike prices in those industries.
Fair Trade Commission (FTC) Chairperson Cho Sung-wook expressed concern over the side effects caused by online platform operators that provide "all-in-one" services aimed at enhancing customer convenience.
"IT firms have provided opportunities for individual businesses to access new markets online as well as have offered more options for consumers for the sake of convenience. At the same time, however, there are increasing cases of damage being suffered by consumers, and concerns exist of unfair practices by platform operators," Cho said during a lecture she gave on fair trade policy held by the European Union Chamber of Commerce in Korea at the Four Seasons Hotel in Seoul.
Cho promised that she will establish a special task force team to monitor digital advertisements on online platforms and reinforce personnel to ensure players do not limit other companies from entering the platform service market. The FTC said that it will also revise rules to prevent IT giants from forming monopolies via dominating online services.
Under the revised bill, IT giants will be fined a maximum of 1 billion won ($856, 743) for unfair practices.
The antitrust watchdog will strengthen consumer rights by requiring companies like Kakao and Naver to take responsibility when consumers experience problems while using their services. The IT firms must also clearly indicate whether products that consumers look up through their platforms are advertisements.
The chief of the liberal ruling Democratic Party of Korea (DPK), Song Yong-gil, expressed concern ― referring to Kakao in particular ― that such a company that is proud of its innovative business, should not continue the unfair practices committed by large business conglomerates in the past, which ignored fairness and collective prosperity and pursued profits for themselves alone.
"Kakao's every move ― from abusing its power as a platform operator to outcompeting small mom-and-pop stores and services, to attempting to raise service prices after dominating the market ― arouses great concern. The Democratic Party of Korea will not ignore this situation, the ruling party's floor leader, Yun Ho-jung, said.
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