Lee So-young, nominee for minister of SMEs and Startups, answers lawmakers' questions during her confirmation hearing at the National Assembly's Trade, Industry, Energy, SMEs and Startups Committee on Tuesday. [Yonhap]
Lee So-young, nominee for minister of SMEs and Startups, answers lawmakers' questions during her confirmation hearing at the National Assembly's Trade, Industry, Energy, SMEs and Startups Committee on Tuesday. [Yonhap]

Lawmaker cites fee, ad and delivery cost burdens on small businesses; platform monopoly raised

Nominee backs regulation, disclosure through online platform law and SME ministry bill

Public delivery app budget of over 120 billion won should move beyond coupon handouts, she says

Lee So-young, the nominee for minister of SMEs and Startups, said Tuesday that regulating private platforms through legislation and requiring them to disclose information could be effective tools for addressing excessive fees charged by companies such as Coupang Inc, open-market operators and online food delivery apps. She also said policy support is needed to make public delivery apps more competitive, and pledged to find more efficient ways to spend the related budget.

Speaking at her confirmation hearing before the National Assembly's Trade, Industry, Energy, SMEs and Startups Committee, Lee responded to questions from lawmaker Song Jae-bong on platform monopoly issues. "I think the difficulties that small business owners and self-employed people face because of platforms are very serious," she said. "I believe many are suffering not only from Coupang Inc's fees but also from open-market commissions and online food delivery app fees."

Song had raised concerns that small business owners are bearing the brunt of high commissions, advertising costs and delivery charges, and asked whether regulating platforms through an online platform law and expanding public delivery apps would help.

In response, Lee said, "Regulating currently operating private platforms and requiring various forms of information disclosure through the online platform law or the Ministry of SMEs and Startups bill currently under review would also be a valid approach."

She also raised the need to develop public delivery apps as a competitive alternative to private platforms. "I think growing what are commonly called public delivery apps into attractive, competitive apps could also be one way forward," Lee said.

Lee said the way the government spends its existing public delivery app budget also needs to be revisited. "The Ministry of SMEs and Startups' budget proposal for this year includes more than 120 billion won ($89.2 million) to foster public delivery apps," she said. "I will think about how to use that budget in a more efficient way rather than simply distributing coupons."

Song also said a significant portion of the public delivery app support budget is allocated to coupon distribution, which he said could undermine long-term sustainability. He suggested the funds should instead go toward improving user convenience and overhauling the delivery system.

On the question of a delivery fee subsidy, Lee left open the possibility of further discussion during the National Assembly's budget review process. "My understanding is that the Ministry of SMEs and Startups pushed for a delivery fee support budget, but it was not reflected in the final government proposal," she said. "If the committee members take it up during the Assembly's budget review, I think it could become a very meaningful budget item."

Lee had previously announced plans to systematically analyze the cost burdens facing small business owners — including rent, interest payments, online food delivery app fees, advertising costs and delivery charges — and develop a roadmap for improving their cost structures. At Tuesday's hearing, she elaborated on specific measures, including regulating private platforms, requiring information disclosure and strengthening the competitiveness of public delivery apps.


hong@heraldcorp.com