Reasons for Proposal
Reason for proposal
According to the current act, the Minister of Trade, Industry and Energy shall establish the Distribution industry development master plan (currently, the 5th distribution industry development master plan is being executed (2019-2023)) every five (5) years, and various regulations are applied to large stores to protect small and medium distributors.
Where, it has been pointed out that the establishment cycle of the Distribution industry development master plan is too long to respond in a timely manner to the rapidly changing distribution industrial environment.
In addition, although the ecological system of the distribution industry is rapidly changed with the rapid growth of retail business in new types such as online distribution, past regulations of large stores are unreasonable, and improvement is required. It has been pointed out that regulating franchisees—which are not included in the subjects of business adjustment in accordance with the “Act on the Promotion of Collaborative Cooperation between Large Enterprises and Small and Medium Enterprises” and Enforcement Rules thereof because they in fact belong to small and medium enterprises among quasi-large stores—in the same way as other quasi-large stores is excessive, and that the restriction of sales on obligatory holidays, etc. of large marts, etc. as is common in the retail business is considered to be reverse discrimination hindering fair competition; thus requiring improvement.
According to the current act, those intending to open large stores shall prepare a commercial territory influence evaluation sheet, but the professionalism and credibility are questionable. Moreover, although distribution industry surveys are permitted to the designated statistics preparation agency, statistical data on the distribution industry to be used by the government, research institutions, and enterprises is insufficient. Thus, there is a need to strengthen the capability for situation surveys by expanding the permission to private agencies.
Therefore, the purpose is to seek the efficient promotion and balanced development of the distribution industry through the improvement of insufficient parts of the current act by shortening the establishment cycle of the distribution industry development master plan, relieving the excessive and unreasonable regulation of large stores, delegating the preparation of commercial territory influence evaluation sheets to qualified professional agencies, and delegating distribution industry situation surveys to private agencies, too.
Main content
A. The act is amended so that only the stores—among those being operated in franchise-type chain business wherein at least 50% of total expenses such as rent, construction costs, and equipment costs needed for the opening of stores are borne by the companies, etc.—operating large stores belong to quasi-large stores.
B. It is prescribed that the cycle for establishing a Distribution industry development master plan is shortened to three (3) years, and a win-win cooperation method between telemarketing dealers and existing businesspersons is included in the content of the master plan (Article 5.1 and Article 5.2.8 of draft).
C. Those intending to open large stores, etc. shall delegate the preparation of commercial territory influence evaluation sheets to the agency or organization designated by the Minister of Trade, Industry and Energy (Articles 8.1 and 8.2 of draft).
D. When large marts and quasi-large stores run telemarketing in accordance with the Act on Consumer Protection in Electronic Commerce Transactions, etc., they shall be excluded from the subjects for obligatory business closing and business hour limitation.
E. It is prescribed that distribution industry situation surveys may be delegated to agencies or organizations related to the distribution industry (Article 46.5 of draft).
