A new economic model estimates that U.S. states could lose $525 billion in economic activity over the next decade if South Korea adopts legislation that would expand regulatory power over transactions involving American technology companies. The Online Platform Fairness Act, being advanced by South Korea's Korea Fair Trade Commission (KFTC), remains pending in that country's National Assembly.

The Competere Foundation model projects state-by-state losses including $123 billion for California, $48.7 billion for Texas, $33.9 billion for New York, and $27.4 billion for Washington over the ten-year period. The legislation would broaden KFTC's authority to regulate how foreign platform companies operate in South Korea.

South Korean President Lee Jae-myung, elected in 2025 after former President Yoon Suk-yeol was impeached in December 2024, has backed the proposed bill. The Democratic Party currently holds a majority in South Korea's National Assembly.

What the Right Is Saying

Republican lawmakers have voiced sharp criticism of the South Korean legislation, calling it discriminatory toward American companies and potentially beneficial to China.

"South Korea is an American ally and an economic success story, which is why its recent and continuing actions restricting American companies — like its 20-year ban on Google Maps — are so troubling," said Rep. Darrell Issa, R-Calif., in a statement to Fox News Digital. "I remain concerned that its current trade commission resembles the worst of Lina Khan's FTC, not the free market tradition that has helped to bring Seoul and Washington together."

Issa told Fox News Digital in April that South Korean leadership and the nature of the Democratic majority in the country is "closely aligned with China."

Former Rep. Chris Stewart, R-Utah, warned that the regulatory approach could have consequences beyond technology companies.

"South Korea's campaign against American companies isn't just a trade issue — it's a strategic mistake that benefits China," Stewart said. "Every time Korean regulators make it harder for U.S. innovators like Coupang, Google, or Meta to compete, they create more room for Chinese companies to gain market share and influence in one of the world's most important digital economies."

In April, 50 members of the House of Representatives sent a letter to Republic of Korea Ambassador Kyung-wha Kang expressing concern over what they called discriminatory business practices against U.S. companies.

What the Left Is Saying

Some progressive economists and trade policy experts argue that foreign platform regulations are not inherently problematic if they apply equally to domestic and international companies. They note that many nations, including the United States, maintain their own competition authorities.

"Every country has a right to regulate platforms operating within its borders," one trade economist told Fox News Digital, speaking on background. "The question is whether these rules are applied fairly and consistently."

South Korean officials have defended the proposed legislation as consistent with international regulatory standards. South Korean embassy spokesperson Minseong Seo told Semafor that investigations into technology companies are "proportionate to the nature of the data breach and consistent with those applied to Korean companies in comparable cases."

Some international trade analysts note that U.S. regulators, including the Federal Trade Commission under both Democratic and Republican administrations, have pursued aggressive antitrust actions against foreign and domestic tech firms alike.

What the Numbers Show

The Competere Foundation model estimates $525 billion in total economic losses for U.S. states over ten years if South Korea adopts the Online Platform Fairness Act. The projected state-by-state impact includes: California at $123 billion, Texas at $48.7 billion, New York at $33.9 billion, and Washington at $27.4 billion.

South Korea has previously imposed a 20-year restriction on Google Maps data sharing with local companies. In early June, South Korea fined U.S.-based Coupang approximately $410 million for a data breach — the largest fine ever issued by that country for such a charge.

The Wall Street Journal reported in early June that Korean officials conducted investigations involving U.S. air force bases as part of domestic inquiries. Shanker Singham, CEO of the Competere Foundation and an international trade economist, said Korea is already "an increasingly unfriendly place for U.S. companies to do business."

South Korea's National Assembly has not yet voted on the proposed legislation.

The Bottom Line

The Online Platform Fairness Act represents a potential flashpoint in U.S.-South Korea relations at a time when both countries are navigating shifting political landscapes. South Korean officials maintain their actions are consistent with international regulatory norms, while U.S. lawmakers argue the measures disproportionately target American firms.

If enacted, the legislation could prompt reciprocal scrutiny of South Korean companies operating in the United States. Congressional members have signaled continued attention to the issue as the bill moves through South Korea's National Assembly. The outcome may depend on negotiations between Seoul and Washington as both governments assess their strategic interests.