By 2016, the central government intends to reduce regulations to 80 percent of the current level, including the elimination of 2,200 business regulations. Starting next year, it will fully introduce a “cost-in, cost-out” system to manage new regulations. Beginning in April, the government will apply a "negative rules system," in which everything is allowed in principle unless it is specifically disallowed by law, and the "sunset rule," under which regulations will automatically become invalid in five years, to allow for the creation of new regulations. Also, ministers will need to personally explain any complaints filed against existing regulations if the related ministries cannot solve the complaints within three months of the time of filing.
On March 20, the government held its first-ever "regulation reform" meeting, presided over by President Park Geun-hye and attended by 140 ministers, government officials, entrepreneurs and experts, all aimed at rooting out unnecessary regulations. The private-public joint meeting announced the deregulation plans, above, containing these changes. The meeting continued for seven hours, beginning at 2 p.m.
There are 11,000 business regulations, out of the total 15,269 registered rules. The government will abolish 10 percent of the business regulations this year and up to 20 percent of them by the end of President Park’s tenure in 2017. Some 6,700 rules made by economic ministries, 3,600 regulations created by social ministries and a remaining 700 made by discipline & security ministries will be eliminated.
A minimum rate of regulation reduction will be assigned to each ministry this year, depending on each departments characteristics. After 2015, every ministry needs to come up with a regulation reduction target. Each ministry will have to prepare a regulation reduction target rate by June and a set of regulation reorganization plans to improve its regulation structure.
The government will grant weighted points to departments that reform the mass of regulations related to the five key service industries related to health and medical services, tourism, education, finance and software, and will reconsider each field as a certain number of targets are reached.
Each ministry’s regulation performance in improving its regulation structure will be made public at the end of the year after being evaluated by the Prime Minister’s Office. The government hopes that the total number of regulations at the end of 2016 will drop to 2009 levels, or to about 12,905 rules and regulations.
Transformation in the framework of regulation
A "negative system" and the "sunset rule" will be applied in principle to all new regulations beginning in April. As of now, the "sunset rule" covers only 12 percent of all regulations, or 1,800 items, but use of the rule will be expanded this year to cover 30 percent of all regulations, or 4,500 items. By the end of 2017, the rule will be applied to 50 percent of existing rules, or to 7,500 rules.
However, there will be some exceptions. The "sunset rule" and the "negative system" will not apply to regulations related to the social safety net, to protecting the less privileged or to areas where they are considered ineffective. Internationally universal regulations will be also exempted.
The government has been registering regulations since 1998, but a large number of them are hidden in blind spots and can cause a cost burden. Under the new plans, unregistered regulations will have to be registered.
Each ministry will need to voluntarily report unregistered regulations by June and the Ministry of Government Legislation and the Prime Minister’s Office will investigate the situation and have those rules registered. The unregistered rules that remain hidden will, in principle, lose their efficacy.
Ministries will have to explain the existence of “thorny regulations” when complaints are filed against them, referring to bothersome or cumbersome business regulations.
If suggestions are made to improve regulations in a private-public sector joint bureau or through the Regulation Reform Committee portal (www.better.go.kr), and if the related ministries refuse to accept the suggestions, the ministries will have to explain, in public and within three months, why these regulations should remain. If the ministries cannot effectively explain the validity of the targeted regulations, the Regulation Reform Committee will review the regulations and recommend an improvement.
Regulation information and settlement bodies will be unified
The government intends to upgrade the Regulation Reform Committee portal (www.better.go.kr) and provide regulation information from various ministries in a real time basis. A mobile service for regulation-related settlement and problem solving will be opened in April. The Ministry of Government Legislation will provide regulation information that is useful for everyday life online. Inconveniences and difficulties experienced by the public and businesses can be reported through the regulation site sinmungo, a website where citizens can voice their complaints. Improvements undertaken to address the suggestions will be posted quickly on the site to encourage two-way communication.