Assemblyman Kang Daesik: "Rest-Area Direct-Contract Pilot Announced in July Adrift... Operators with Expired Contracts Still Operating"

Unable to Issue Bid Notice Amid Disputes and Lawsuits Over Asset Acquisition Payments... Temporary Operations This Year Scrapped
Conflicts With Existing Operators' Handover Practices... Wide Gap Between Appraised Values and Demands
Assemblyman Kang: "Urgent to Establish Standard Model for Rebidding Deadlines and Asset Acquisition Rather Than Rush Ahead"

The government's announced "pilot program for direct contracts at highway rest areas" is facing difficulties due to issues including asset acquisition and legal disputes.

In July, the Ministry of Land, Infrastructure and Transport said it would introduce direct contracts at eight rest areas and aimed to begin temporary operations in December. However, as of October, the Korea Expressway Corporation had not even issued a bid notice.

As a result, temporary operations within this year have been called off, and the Korea Expressway Corporation has postponed its target to the 2027 Lunar New Year holiday.

Rep. Kang Daesik of the National Assembly’s Land, Infrastructure and Transport Committee (People Power Party, Daegu Dong-gu and Gunwi County B). Provided by Rep. Kang Daesik’s office.

The main cause of the delays is a gap between the asset acquisition amounts sought by existing operators and those proposed by the Korea Expressway Corporation.

While current contracts stipulate that sites must be restored to their original condition, in practice, the transfer of goods worth hundreds of millions of won between outgoing and incoming operators has become customary.

While large operators are demanding around KRW 1 billion in acquisition payments, the Korea Expressway Corporation's objective appraisal is likely to fall short of that amount, raising concerns about disputes, including refusals to surrender the premises.

Meanwhile, some of the existing rest areas slated for conversion are involved in lawsuits over the handover of their buildings following the end of their contracts in 2023. At other rest areas whose contracts have been terminated or expired, the existing operators continue to run their businesses.

Assemblyman Kang Daesik of the National Assembly's Land, Infrastructure and Transport Committee (People Power Party, Daegu Dong-gu and Gunwi-gun B) strongly criticized the situation, saying, "The government, preoccupied with delivering results and focused solely on racing ahead, has failed to properly resolve even the on-the-ground issues of asset acquisition and the handover of premises, and has been unable to issue a bid notice."

Assemblyman Kang particularly stressed, "If the government allows the breakdown in which operators continue to do business after their contracts have ended, the same disputes and confusion will inevitably recur in the conversion of at least 83 rest areas whose contracts are due to expire by 2027." He added, "The Ministry of Land, Infrastructure and Transport and the Korea Expressway Corporation must promptly establish a standard model that clearly sets out the deadline for rebidding after a contract expires, the criteria for asset acquisition, and the procedures for handling disputes."

For the pilot program for direct contracts to take hold, it is essential to specify the criteria for asset acquisition and the procedures for handling disputes, thereby reducing uncertainty during the transition to new operations.

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