Small Business Crisis: Why 7.9M Korean Merchants Are Fighting New Law

Small-business groups expressed strong regret over the National Assembly’s Industry, Trade and SMEs Committee for tabling an amendment to the Distribution Industry Development Act and demanded its immediate withdrawal.

The Federation of Small Businesses issued a statement on the 26th condemning the bill, which centers on permitting early-morning deliveries. The amendment would ease restrictions on large supermarkets’ late-night operations and relax mandatory closure rules, effectively opening the door to dawn delivery services by major retailers.

In the statement, the groups said small businesses face an existential crisis amid high inflation and interest rates. They sharply criticized the National Assembly for pushing small operators to the brink to address complaints from large corporations while the foundations of the everyday economy are shaking.

They described the 2012 restrictions on large-mart operations and mandatory closures as \”the last bulwark of neighborhood commerce,\” warning that loosening those rules would hand capital-rich large retailers a weapon for indiscriminate assault on local businesses.

They also dismissed the government’s and the Assembly’s argument that the changes would rein in online platforms as an inversion of priorities. The groups argued that strengthening large retailers’ distribution monopolies would erode diversity in the retail ecosystem and, over the long term, harm consumers.

The federation said it will not accept any compromise that suffocates neighborhood commerce and pledged to file a constitutional challenge with the Constitutional Court immediately if lawmakers force the bill through. It also warned that it will hold politicians who back this anti-coexistence bill strictly accountable in the name of 7.9 million small-business owners.

Finally, the federation urged the National Assembly and the government to pursue practical measures to strengthen the Distribution Industry Development Act — including support to boost the self-sufficiency of traditional markets and supermarkets and extending regulations to large food wholesale marts — rather than loosening rules.