Deregulation Drive Stalls due to National Assembly

Given many regulations whose revision will have far-reaching implications need amendment or enactment, the administration’s rush toward deregulation requires the support of the National Assembly.

When the Prime Minister’s Office analyzed 147 cases of core regulatory reform to be pursued by the government, it found it could handle 89 of them (60.5 percent) if it only revises lower laws such as enforcement ordinances and regulations, notifications and other regulations.

The remainder needs approval from the National Assembly. For example, a law on telecommunications business needs revision to ease licensing of communications companies, and one on improvement of urban and living environment needs amendment to abolish requirements on building rental houses imposed on builders.

The Employment Protection Act also needs fixing to allow the self-employed to subscribe to unemployment insurance.

Worse, the National Assembly has yet to deal with 95 of 159 laws (60 percent) on regulatory reform pursued by the government last year.

The government promised to complete regulatory reform on abolishing ownership limits and trade of marginal farmland and rationalizing regulations on bank stock ownership and financial holding companies by the end of last year. The revised bills have yet to be passed at the National Assembly, however.

Instead, the government has bragged about completing 1,202 of 1,249 regulatory reform cases, something to which most Koreans or companies disagree.

Kim Chung-ho, head of the Center for Free Enterprise of the Regulatory Reform Committee, said, “Though the government says it has already revised thousands of regulations, Koreans have rarely felt the changes since many revisions have yet to be approved by the National Assembly.”

Worse, the ruling and opposition camps are still locking horns over thorny issues at the National Assembly, with the opposition strongly against revised bills on core regulations. Given that, the government will struggle to keep its promise.

A source at the Prime Minister’s Office said, “The only thing we can say is that the government will make an all-out effort to persuade the National Assembly.”

Kim said, however, “Regulations whose reform is good for all have already been eased. On the other hand, the regulations that remain are those whose revision might benefit some people but damage others.”

That means regulatory reform is a tall order since those stand to lose from deregulation are strongly opposed.

One expert in the private sector said, “If the government only struggles to ease regulations that the ruling and opposition parties do not disagree over, that means the government has no will to revise regulations.”

kimkihy@donga.com