Proposed South Korean Delivery Fee Cap May Shift Costs to Couriers and Consumers
Lawmakers are debating bills to limit food-delivery platform fees to 15% of an order, but experts warn the cap could push costs onto riders and shoppers.
Pending legislation in South Korea’s National Assembly seeks to cap the total fees that food-ordering platforms charge merchants at 15% of each order’s value, with separate limits on delivery charges. The proposals, introduced by Rep. Lee Kang-ill of the Democratic Party of Korea and Rep. Park Jeong-hun of the People Power Party, target brokerage, payment processing, advertising and delivery fees. Critics argue that because delivery fees already exceed the proposed ceiling, platforms would have to cut them, which could lower couriers’ wages and force higher costs onto consumers.
The Delivery Platform Workers' Union warned that any fee reduction must be paired with safeguards for rider pay, while the PPP warned the cap could backfire on small businesses. Scholars at a recent seminar urged that reforms share the burden across the ecosystem, noting possible cuts to platform-provided promotions and reduced customer acquisition for tiny stores. The debate underscores the complexity of regulating South Korea’s fast-growing food-delivery market.
Why it matters
The decision will shape restaurant expenses, rider wages and consumer prices in South Korea’s delivery economy.
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