The National Assembly on Tuesday approved a 17.3 trillion won ($15.8 billion) supplementary budget to boost the economy and fund welfare spending. 

However, key economic democratization measures have been put on hold until June, due to disagreement over changes regarding financial transaction information.

The extra spending plan was approved 20 days after the government drew up the plans.

The ruling Saenuri Party and the main opposition Democratic Party reached an agreement over the supplementary budget at the last minute with the former conceding to demands for the central government to cover the cost of purchasing land for the science belt near Daejeon.

Although the two main parties had agreed on several related issues ahead of the final plenary meeting of the April session, the opposition party’s demands delayed the process. 

The suggestion was, however, accepted by the ruling party after a last-minute conference between the floor leaders, resulting in 30 billion won of the supplementary budget being set aside for the purpose.

As for the economic democratization measures, which has been strongly opposed by the business community, the parties agreed to give priority to discussing the issues in the upcoming session in June.

The delay came as the two sides clashed over the proposed revision to the Act on Reporting and Use of Certain Financial Transaction Information, despite largely agreeing on plans to revise the Fair Transactions in Franchise Business Act and the Monopoly Regulation and Fair Trade Act.

Under the proposed revision to the financial transactions act, the authorities will be given access to a wider range of the Financial Intelligence Unit’s data regarding suspicious cash transactions.

Although the change is essential for realizing President Park Geun-hye’s pledge to bring the underground economy under government control, the main opposition Democratic Party had opposed the revision, citing concerns that the system was being abused.

With the parties failing to narrow their differences, the Democratic Party called for the two trade-related laws to be passed first, but the suggestion was rejected by the ruling party.

“In order to legislate the revised Act on Reporting and Use of Certain Financial Transaction Information, the Saenuri Party linked it to the other economic democratization laws and said the deliberation period was not fulfilled,” Democratic Party floor spokesman Yoon Gwan-seok said, adding that his party expressed “deep regret” over the developments.

As for the fair trade acts, the revised Fair Transactions in Franchise Business Act and the Monopoly Regulation and Fair Trade Act are designed to rein in large companies in their interaction with small businesses and individuals.

Under the revised franchise business act, franchisers are required to provide franchisees with sales expectations in writing.

Large franchisers will also be required to cover up to 40 percent of the costs of renovating franchise stores when such projects are carried out per request of the franchiser.

But the Korea Franchise Association slammed the revision, saying that the changes were made without consulting the industry and experts, and that they were moving against economic democratization.

Along with the franchise business act, the Monopoly Regulation and Fair Trade Act is to be revised to give a number of government agencies other than the Fair Trade Commission the power to request investigations into unfair trade practices.

Under the proposed revision, the heads of the Small and Medium Business Administration, Public Procurement Service and Board of Audit and Inspection will be able to request investigations along with the FTC.

By Choi He-suk (cheesuk@heraldcorp.com)