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As the regulation of the “ceiling on total amount of shareholding in other domestic companies” had been removed from Korean ompetition Law in 2009, remaining regulatory tools of countermeasures over excessive economic concentration, e.g. limitation on cross-shareholding, became ineffective regarding the concerns of general concentration. Existing regulations that were designed to fit into the old management practices and/or corporate governance lost their target in the new business environment. Despite such institutional changes, the economic share of the top large business groups in national economy increased drastically. As a result, it is observed that the effectiveness of regulations over general concentration became weakened while concerns of general concentration continue.

An interpretation of statutes suggests that the mission to improve corporate governance may belong to the power of Korean Competition Law only when it is relevant to general concentration and/or market concentration. However, the prohibition of unreasonable subsidy and tunneling which the KFTC has recently emphasized in enforcement seems to aim to improve concentration of possession or corporate governance at first hand, lacking appropriate relations with any concentration issues. It is argued that such an enforcement by the KFTC that deals with the concerns of concentration of possession and/or control in appearance without proper attention to general concentration may not be compatible with the purpose and structure of the present Competition Law.

In the United States, growing awareness of the excessive monopoly power of digital platforms including GAFA raises the concerns of excessive market concentration and a potential threat to democracy. The New Brandeis School calls for aggressive egulation over anti-competitive M&A and monopolization by GAFA. The antitrust authorities and Congress echo with serious antitrust enforcement and discussion of legislational changes. It may suggest changes of enforcement direction that considers issues of general concentration seriously, as compared with the existing sole goals of consumer welfare and efficencies as directed by the Chicago School since 1970’s. Considering growing concerns of general concentration by a few top business groups, it is argued that we need to strengthen the regulation over general concentration in the perspective of market structure. We also need to consider the introduction of tougher antitrust enforcement or imposing special responsibilities as stated in the European Competition Laws. Regarding local digital platforms, restructuring existing regulations to fit into their characteristics and strengthening watches over their market dominance is required.

Hwang Lee
(Professor, School of Law, Korea University)

[Yonsei Law Review, Vol. 31-1, March 2021]