With Donald Trump’s inauguration as U.S. president on January 20, 2025, South Korea’s competition policy faces heightened uncertainty. (Image courtesy of President-elect Donald Trump’s inaugural committee)
SEJONG, Jan. 20 (Korea Bizwire) — With Donald Trump’s inauguration as U.S. president on January 20, 2025, South Korea’s competition policy faces heightened uncertainty due to his administration’s protectionist agenda and potential pushback against regulatory moves targeting Big Tech firms.
U.S. Resistance to South Korean Platform Regulation
South Korea’s proposed legislative reforms aimed at curbing anti-competitive practices by major platform operators, such as self-preferencing, bundling, and restrictions on multi-homing, have drawn criticism from U.S. entities.
The legislation, unveiled by the Korea Fair Trade Commission (KFTC) in September 2024, would increase fines for violations from 6% to 8% of relevant sales. The rules could affect companies like Google, Apple, Amazon, and Meta.
Ahead of Trump’s second term, the U.S. Chamber of Commerce voiced concerns about the legislation, claiming it unfairly targets American firms while excluding competitors from third countries. Adding pressure, Republican Representative Carol Miller introduced a bill in September 2024 that proposes retaliatory tariffs under Section 301 of U.S. trade law if discriminatory regulations are enacted.
Trump’s Protectionist Policies Raise Concerns
While Trump has yet to clarify his stance on Big Tech, his track record suggests a strong inclination toward protectionism. His administration previously threatened tariffs on French goods in 2019 in response to a digital tax targeting U.S. tech giants, a precedent that raises concerns about potential retaliation against South Korea’s policies.
Experts warn that South Korea’s legislative efforts could face significant obstacles if both U.S. and domestic stakeholders resist. Lee Hwang, a professor at Korea University, noted, “If U.S. firms oppose the legislation and domestic platforms push back, the government’s regulatory ambitions could stall.”
Potential Repercussions for Targeting U.S. Firms
The KFTC is also set to decide on penalties for Google’s alleged anti-competitive practices involving its YouTube Premium service. Officials worry that harsh sanctions could provoke informal retaliation from the Trump administration, echoing similar challenges faced by European regulators. The European Union’s recent adjustments to its Digital Markets Act enforcement have sparked speculation that it is treading carefully under U.S. pressure.
Optimism Amid Uncertainty
Despite fears of retaliation, some experts believe U.S. opposition may not escalate. The U.S. has largely accepted similar regulations enacted in the EU and Japan, and South Korea’s proposals are less stringent than the EU’s preemptive measures. Moreover, historical U.S. responses to significant penalties imposed on companies like Qualcomm and Google by the KFTC have been relatively subdued.
A KFTC official stated, “It is premature to speculate on how the U.S. will respond. We are closely monitoring developments and will proceed cautiously.”
The Road Ahead
South Korea’s platform regulations aim to protect consumers from monopolistic practices, but political turbulence, both domestically and internationally, threatens progress. As Trump’s administration begins to shape its policies, Seoul faces the delicate task of balancing regulatory goals with diplomatic and economic considerations.
M. H. Lee (mhlee@koreabizwire.com)
