The Office of the United States Trade Representative (USTR) has canceled the meeting of the Korea-U.S. Free Trade Agreement joint committee that had been scheduled for the 18th local time. It is seen as the Donald Trump administration issuing a strong warning, taking issue with the Korean government's digital and platform regulations.
According to industry sources and the U.S. political outlet Politico on the 19th, the Korea-U.S. Free Trade Agreement joint committee meeting, which had been set to be held behind closed doors in Washington, D.C., on the 18th, was canceled at the request of the Office of the United States Trade Representative (USTR).
This meeting is a bilateral consultative body established under the Korea-U.S. FTA concluded in 2012, and it was to be held for the first time since the trade agreement was revised after the Korea-U.S. summit in Oct. this year, with the United States lowering tariffs on Korean products to 15% in exchange for Korea pledging to expand investment and not to pursue digital regulations unfavorable to U.S. corporations.
Koo Yun-cheol, Deputy Prime Minister and Minister of the Ministry of Economy and Finance, said on the 12th, "We plan to push for holding the Korea-U.S. FTA joint committee soon," and added, "We will consult on detailed implementation plans for agreements in non-tariff areas in a way that best serves the national interest."
Citing sources, Politico reported that the United States postponed the meeting to early next year, taking issue with Korea's legislative moves on digital regulation. The Trump administration is said to have determined that platform regulation bills being advanced in the National Assembly could potentially violate existing trade understandings not to discriminate against U.S. corporations.
In the joint fact sheet, the final product of the two countries' tariff talks and security consultations, the U.S. government included language stating, "Korea and the United States will ensure that U.S. corporations are not discriminated against with respect to laws and policies related to digital services, particularly network usage fees and online platform regulation," checking the Korean government's legislative push.
Politico reported that, during recent National Assembly audits, pressure for regulation targeting U.S.-listed corporations such as Coupang and data-related investigations is being perceived as regulatory excess and unfair treatment.
Jamieson Greer of the Office of the United States Trade Representative suggested the possibility of initiating a Section 301 investigation, which could lead to tariff imposition, if Korea does not withdraw the regulatory proposals.
As the view gains traction that the United States should respond to Korea's digital regulations targeting big tech, some expect brakes to be applied to the ruling party and government's push for the Online Platform Act and the legislation of network usage fees. The government's review of Google and Apple's requests to transfer abroad 1-to-5,000 accumulated high-precision map data also appears likely to be affected.