Antitrust body seeks talks with US on platform regulation to prevent trade conflict

Investigation into Google Korea underway in line with law: FTC

By Lee Min-hyung

The nation’s antitrust watchdog said it will deepen talks with the United States to minimize potential repercussions from its plan to regulate market-dominant tech firms, as fears of trade retaliation from the world’s largest economy loom larger under the Donald Trump administration.

“The Fair Trade Commission (FTC) will strengthen communication with the National Assembly and the U.S. to ensure that the issue does not trigger any trade problems from the viewpoint of national interest,” FTC Chairman Han Ki-jeong said during a press conference, Monday.

The controversial revision to the Fair Trade Act, better known as the Platform Act here, is centered on regulating influential online platform firms, so they do not engage in any foul play or anti-competitive sales practices by utilizing their dominant market positions.

If the revision bill passes the Assembly, any platform firms with a more than 60 percent market share and with over 10 million users will face fines of up to 8 percent of their sales in case they violate the rules, such as cross-selling of their online services.

However, this has provoked a strong backlash from the U.S., as major U.S. platform firms and services, including YouTube, may fall victim to the revised regulation.

Concerns also rise here, as the legislation is feared to trigger U.S. trade retaliation. Trump has repeatedly threatened to levy more barriers onto its trade partners which report a trade surplus with the U.S., and his administration has also stepped up aggressive rhetoric against countries that block entry of U.S. firms.

Earlier this month, Jamieson Greer, Trump's nominee for U.S. Trade Representative (USTR), warned Korea and other countries against taking regulatory measures that would negatively affect American tech firms, saying that "it won't be tolerated."

The FTC chief underscored the importance of dealing “flexibly” with the trade concerns.

“We are strengthening our monitoring on the fair trade policy direction of the Trump administration,” Han said.

“The FTC needs to remain flexible by holding not just working-level, but top-level meetings between competition authorities from both countries.”

The Korean fair trade authority is currently investigating Google Korea over its alleged breach of fair competition, as the company is suspected of cross-selling YouTube Music when selling its YouTube Premium subscription service.

If the FTC slaps stricter-than-expected sanctions on Google Korea, some critics argue it may draw some form of trade retaliation from the U.S.

But the FTC head reaffirmed his strong willingness to regulate the company in accordance with the law and principles.

“The case cannot be overly regulated, nor should it be underregulated,” Han said. “Our regulations should not unfairly discriminate between local and overseas firms. We will conduct the investigation in line with the law and principles.”