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KEI Spotlight

What the South Korea-US Summit Had to Say About Internet Policy

October 6, 2022

This article was published on The Diplomat on  June 7, 2022.

From semiconductors to autonomous robotics, the May 21 joint statement between Presidents Yoon Suk Yeol and Joe Biden emphasized strategic, economic, and technology partnerships between South Korea and the United States. There were also two items related to internet policies that did not get much attention from the press but carry significant implications for the future of the two countries’ cooperation on bilateral trade and human rights.

First, both leaders affirmed the commitment of their respective government to protect an open, free, global, interoperable, reliable, and secure Internet.” The joint statement added that South Korea was “ready to join” the Declaration for the Future of the Internet. This is a U.S.-led global partnership of 60 other countries, including members of the European Union, Japan, and Taiwan, that came together in April 2022. Although there are no specific actions laid out yet, the declaration sets a common rule for use of technology that will constitute the future of high-value trade between post-industrial countries.

South Korea was not a signatory to the declaration, and this could cause headwinds for its enterprises to export digital services to peer economies in the future. One reason for Seoul’s initial exclusion from the agreement could be due to an ongoing legal battle between a South Korean internet service provider, SK Broadband, and the U.S. content distributor Netflix. The two sides disagree on who is financially responsible for increased internet traffic caused by more South Koreans streaming Netflix’s content. In response, the South Korean National Assembly is debating a proposed revision to the Telecommunications Business Act that would require global content providers to pay additional network fees to Korean internet providers when there is a surge in broadband usage to access foreign platforms.

Concerns raised by Netflix and other large U.S. content distributors may create challenges for domestic digital service companies looking for partners to grow globally. YouTube’s Vice President and Managing Director for APAC Gautam Anand noted that the revised law could “undermine YouTube’s opportunity to make continuous investments for Korean creators to be successful.” The U.S. Trade Representative’s 2022 National Estimate Report on Foreign Trade Barrier also addresses this issue as a trade barrier between the United States and South Korea along with the South Korean government’s restriction on the cross-border data transfer for international companies.

To read the full article on The Diplomat, click here.