The 5th Subcommittee on Information and Communication Broadcasting Act Review of the National Assembly’s Science, Technology, Information and Broadcasting Committee was held on the 2nd at the National Assembly in Yeouido, Seoul, to discuss the partial amendment of the Telecommunications Business Act. Chairman Kim Hyun presided over the meeting. A legislative proposal to amend the Telecommunications Business Act, which aims to restrict the market share of mobile virtual network operators (MVNOs) owned by mobile carriers, financial institutions, and conglomerates, was postponed for the third time. The Ministry of Science and ICT proposed reinstating the wholesale provision obligation for dominant market players as a new alternative. The government and political parties decided to hold a decisive discussion in the next subcommittee meeting to determine the direction of regulation.
The subcommittee, known as the ‘5th Legislative Subcommittee’, focused on discussing the so-called “MVNO Market Share Limitation Bill.” A bill proposed by Democratic Party lawmaker Kim Hyun aims to limit the market share of large corporate MVNOs, such as subsidiaries of the three major mobile carriers and companies like KBLiveM and Toss, to 60% (excluding IoT connections and based on mobile phones). Last month, on the 27th, the Ministry of Science and ICT suggested limiting the market share of the three major mobile carriers to below 50%, excluding IoT, during the subcommittee meeting.
However, on that day, the Ministry of Science and ICT introduced a new proposal emphasizing pre-regulation through improved wholesale provision systems. They suggested reverting the wholesale price negotiation system to its state before 2022, where the government would negotiate with SK Telecom on behalf of MVNO operators. The Ministry expressed that issues like market share restrictions could be discussed with preemptive wholesale price regulation.
The opposition and the Ministry of Science and ICT, along with the ruling party, engaged in heated debates over these proposals, but no conclusion was reached. The Ministry argues that instead of legally limiting market share, practically beneficial measures like reasonable wholesale pricing are more important for protecting small MVNOs, and this would require active government intervention similar to past practices.
In contrast, the opposition expressed a cautious stance, pointing out that the Ministry brought forward a previously undiscussed new proposal. With the current system of post-contract examination of agreements between telecom companies and MVNOs not even a year old, there was difficulty in understanding the sudden suggestion to revert to former regulatory methods.
Ultimately, the government and political parties decided to discuss all options, including the 60% market share limit for all large corporate MVNOs, the 50% limit for subsidiaries of the three major carriers, and the pre-regulation of wholesale price negotiations in the next subcommittee meeting. Assemblyman Lee Hae-min from the National Innovation Party commented after the meeting, “The Ministry of Science and ICT presented a new proposal, and due to differences in opinion among the parties, we couldn’t reach a conclusion. A careful review seems necessary.”