[Editorial] Leave Homeplus’s recovery to the market; the government should normalize retail regulation

Homeplus is emphasizing the viability of its remaining businesses and appealing for the need to secure KRW 200 billion in emergency operating funds. The recovery in sales at Homeplus Express after the normalization of product supply shows that consumer demand and business value still remain in some parts of the business. However, a short-term rebound in sales alone is not enough to prove the sustainability of Homeplus’s overall operations. The company’s actual prospects for recovery must be tested in the market through operating profit and cash flow, the willingness of new investors to participate, and the possibility of mergers and acquisitions, rather than through sales generated by discount events.

As online shopping, dawn delivery, and short-distance delivery services grow rapidly, the business environment for traditional offline big-box retailers has fundamentally changed. As consumer purchasing patterns shift and competition among retailers intensifies, the closure of less competitive stores and the restructuring of corporate business models are unavoidable forms of market-driven restructuring. It cannot be the government’s role to artificially keep every existing company and store alive.

Therefore, the government should be cautious about supporting Homeplus’s recovery by injecting operating funds or policy financing on the grounds of its employment size or the potential damage to partner companies. Government support would shift losses that should be borne by existing shareholders and creditors onto the public, while weakening accountability for management failure and market discipline. Whether Homeplus survives should be decided by its largest shareholder, creditors, and prospective new acquirers based on their assessment of the company’s performance and risks. If the company truly has sufficient recovery potential, that potential should be demonstrated not through political appeals but through actual investment from private capital.

That does not mean the government should do nothing at all. What the government should do is not rescue a specific company with taxpayers’ money, but remove regulations that no longer fit the changed retail environment and create fair competitive conditions.

The current Distribution Industry Development Act imposes various regulations on big-box retailers and corporate supermarkets, including mandatory closure days and restrictions on business hours. These regulations were introduced under the banner of protecting traditional markets and neighborhood commercial districts, but instead of directing consumers back to traditional markets, they have resulted in expanded use of online shopping and e-commerce. In a situation where online retailers remain outside the scope of regulation, a system that restricts only offline big-box retailers and SSMs does not fit the reality of the retail industry.

The Homeplus crisis once again shows that regulations on big-box retailers may fail to provide meaningful protection for neighborhood commercial districts while only weakening the competitiveness of offline retailers. Restricting the operations of big-box retailers will not stop the restructuring of the retail market around online commerce, and when financially distressed big-box stores close, workers, tenant businesses, suppliers, and local consumers all suffer along with them.

Rather than intervening to artificially keep Homeplus alive, the government should comprehensively review the regulations on big-box retailers and SSMs under the Distribution Industry Development Act. It should overhaul preemptive business regulations, including mandatory closure days and restrictions on business hours, and normalize the system so that online and offline retailers can compete freely in the same market.

The recovery or exit of companies should be decided by the market, while the government should remove outdated regulations that obstruct competition. The lesson of the Homeplus situation is not that more public funds should be poured into failing companies. It is that the regulatory system, which has discriminated against specific retail formats while ignoring the changed consumer environment, must now be fundamentally reformed.

2026. 6. 19.

Center for Free Enterprise (CFE)

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Original title: [논평] 홈플러스 회생은 시장에 맡기고, 정부가 할 일은 유통규제 정상화다

Author: Center for Free Enterprise (CFE)

Date: 2026-06-19

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=comment&pn=1&idx=29184