The retail industry is on high alert in South Korea as the new government and ruling party move to reinstate the mandatory closure of large supermarkets on public holidays, which was scaled back or abolished under the previous government.

Representative Oh Sae-hee of the Democratic Party of Korea (DPK), who proposed the “Partial Amendment to the Distribution Industry Development Act,” said on Monday that “our party will pass a bill that mandates large supermarkets to close only on legal public holidays.”

“Closing twice on Sundays does not necessarily mean they incur losses. That is just their perspective,” she added.

The bill is currently under review by a parliamentary subcommittee and is expected to pass the plenary session soon, after which it will be promulgated and implemented.

Local governments currently can adjust closure days at their discretion, but large supermarkets will be required to close on public holidays twice a month if the ruling party’s bill is passed.

The retail industry is now scrambling to respond, with an official saying, “The inevitable has finally come.”

The DPK believes that poor performance at large supermarkets stems from structural issues caused by excessive and cutthroat competition - not from regulations requiring closures on public holidays.

“There is excessive overheating and competition for new store openings in each district,” Oh said. “While the previous government, including the Ministry of Trade, Industry and Energy, gave a lot of consideration to the industry’s position, our party and government will not do the same.”

The new administration also plans to tighten regulations on the franchise industry.

The DPK designated a franchise business law amendment as a fast-track item in April 2025, which would grant franchisees collective bargaining rights similar to those of workers. If the amendment is enacted as scheduled in the first half of 2026, franchisors who refuse to respond to negotiation requests from franchisee associations could face corrective orders or administrative penalties.

Private equity firms may also face significant restrictions in acquiring or merging with franchise businesses.

An industry insider expressed concern, saying, “Most of the proposed bills were drafted without sufficient communication with the industry. The entire offline retail sector could face even greater challenges amid the prolonged economic downturn.”

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