Why a glut of regulations?The legislature is churning out corporate regulations in stark contrast to President Park Geun-hye’s campaign pledges to enliven corporate activities and investment. According to the Federation of Korean Industries, regulations increased by 882 from the end of last year to a total of 14,796 as of May. Even when considering the number of regulations that were scrapped, 1,338 regulations were created this year. Regulations have surged quickly under the Park Geun-hye administration despite her pledge to remove red tape for businesses.
Corporate regulations increased sharply because politicians vied to ride the wave of economic justice that was in fashion during last year’s campaigning.
Under the banner of economic democratization, bills on business contracts, raising the retirement age and taxes to rein in large companies’ exclusive business relationships with their affiliates have passed or are pending in the National Assembly. Other bills have proposed enforcing fair competition, workers’ rights and protecting the weaker party in the corporate community. They will come under review in the extra session in June.
Of 5,102 bills registered with the National Assembly secretariat, 4,772 were sponsored by lawmakers. Of them, 65 percent involve regulation of corporate activities. Of course, they won’t all be approved. However, lawmakers are turning out regulations without thorough study of their ramifications on the economy and consumer interests. If any of the irresponsible bills are passed, they could wreck havoc on the economy and corporate sector.
The ruling and opposition parties have agreed to pass a bill to cut back working hours despite protests from both employers and labor. Employers and unions fear higher costs and reduced income if allowed working hours are scaled down to 52 from the current 68.
The special law to promote employment of young people is also controversial. It creates a quota in the public sector for hiring of new employees under 29. Job-seekers in their 30s have been especially vocal in their opposition. Despite the obvious side effects, there’s no mechanism to contain reckless bills from lawmakers. Unlike government-proposed bills that come under scrutiny from lawmakers, the bills drawn up by legislators are rubber-stamped without thorough study.
If they had national interest at heart, lawmakers would exercise more discretion and sincerity in their proposed legislation by going through hearings and prior examinations.
Standing committees and regulatory sessions must work to filter out the large amount of poorly prepared bills.