Cabinet signs new law limiting big stores’ hours

The cabinet approved a revision to the Distribution Industry Development Act yesterday to strengthen regulations on large retailers as part of an effort to protect mom-and-pop shops and revitalize traditional marketplaces.

The government held its first cabinet meeting at the Sejong Government Complex in Sejong City to vote for the revision.

Under the new law, large discount chains and so-called super-supermarkets must close stores twice a month, on Sundays or public holidays, and limit their operations between midnight and 10 a.m.

Currently, 30 local governments out of 230 nationwide require large retailers to close one or two days per month and limit operations from midnight to 8 a.m.

There have been calls from associations of small businesses and civic groups to regulate retail giants with a nationwide law. The National Assembly passed the revision Jan. 1.

Companies that violate the law more than three times a year face business suspensions of up to one month.

The new law also raised the fine for violators to up to 100 million won ($947,867) from the current level of up to 30 million won.

“The regulation aims to seek mutual development of both large and small retailers, revitalize local businesses and protect rights of employees of large retailers,” the government said in a statement.

The issue of restriction on operating hours has been one of the most controversial in the retail industry since last April when some of Seoul’s district councils imposed such restrictions. Those restrictions led to various law suits.

In case of opening a new store, the operators are required to inform the local government of their plans 30 days prior to the submission of its business registration application under the new law.

By Yonhap, Kim Jung-yoon [kjy@joongang.co.kr]