86% of Startups Report Operational Constraints Due to Digital Regulation, Slowing Innovation

Startup Alliance, CODIT, and Korea Startup Forum

Hold National Assembly Brown Bag Meeting

A recent survey has found that 8 out of 10 domestic startups are experiencing operational constraints due to digital regulations. It was pointed out that the diversion of funds and manpower to regulatory compliance is posing a burden on technology development and attracting investment.

The Startup Alliance, CODIT Global Policy & Research Institute, and Korea Startup Forum announced on the 6th that they held a National Assembly Brown Bag Meeting on the afternoon of the 5th in Conference Room 5 of the National Assembly Members' Hall, under the theme "Startup Competitiveness and Direction of Digital Regulation in the Artificial Intelligence (AI) Era."

During the keynote presentation, Kyumin Kim, Korea representative of Digital Prosperity Asia (DPA) and host of the meeting, introduced a survey conducted by Oxford Economics targeting 500 stakeholders from startups, venture capital (VC), and incubators. According to the survey, 86% of startups reported experiencing operational restrictions due to digital regulations. Kim explained that the allocation of funds and manpower to regulatory compliance is impeding innovation activities and increasing investment uncertainty.

On the afternoon of the 5th, participants are taking a commemorative photo at the National Assembly Brown Bag Meeting held in the conference room 5 of the National Assembly Members' Office Building, themed "Startup Competitiveness and Directions of Digital Regulation in the Age of Artificial Intelligence (AI)." Startup Alliance

During the panel discussion that followed, participants pointed out the frequent changes in policies, uniform support criteria, barriers to entering public markets, and redundant regulations among different government ministries as key challenges on the ground.

Jaewon Sun, CEO of Meraki Place, stated, "The telemedicine policy has changed five times in its overall framework, and about ten times when including implementation guidelines. As a result, our development and R&D personnel have repeatedly been redirected to regulatory compliance tasks. Since even a single detail in subordinate regulations can undermine the legislative purpose and service effectiveness, policy stability and communication with stakeholders are critically important."

Junyoung Park, Chief Product Officer (CPO) of Trillion Labs, commented, "While data collected in Korea is used as open source abroad, domestic companies face challenges accessing the same data. Public procurement and support for data and GPUs should be designed to fit the way they are actually used on the ground."

Jooyoun Jeong, Senior Research Fellow at Startup Alliance, highlighted that overlapping regulations among ministries persist even during the grace period under the AI Framework Act. He remarked, "Now is the time not to introduce more regulations, but to keep only necessary rules and remove redundant or ineffective ones."

Finally, Ji-eun Jung, CEO of CODIT and the moderator of the event, concluded, "Starting with today's meeting, we aim to create ongoing forums where startups, VCs, and the National Assembly can continue to share real-world challenges and connect those discussions to actual legislation and policy changes."

This content was produced with the assistance of AI translation services.