A statutory clock on every Korean film
On September 12, 2025, Rep. Lim Oh-kyung of the Democratic Party introduced an amendment to South Korea's Act on the Promotion of Motion Pictures and Video Products that would bar any film from moving to OTT or IPTV platforms until six months after its theatrical run ends, with an administrative fine of up to 50 million won for violations. Small films, shorts, independent films, and art films are exempted Asia Economy. The bill is still working through committee, but it has forced South Korea's film and streaming industries into a genuine reckoning about who absorbs the cost of a collapsing theatrical business.
The case for a floor under theaters
The strongest argument for a mandatory window is not sentimental. Cinema admissions in South Korea have fallen 53% since 2019, and the number of Korean films getting a real theatrical release is projected to drop from roughly 40 titles to just 22 in 2026 Screen Daily. The three major chains are all losing money on their core business: CGV's domestic operations posted a 49.5 billion won operating loss in 2025 despite 13% revenue growth, Megabox lost 12.4 billion won, and Lotte Cinema lost roughly 28.5 billion won The Korea Herald. Exhibitors argue that when a film can be watched at home within weeks of leaving cinemas, marginal moviegoers simply wait — and that global platforms buying IP for near-simultaneous streaming release have broken the informal holdback windows that used to protect theatrical runs. That is a real market failure, not a manufactured one, and it deserves a real policy response.
Why a blanket statutory mandate is the wrong instrument
The problem is that Lim's bill treats every film the same regardless of whether it ever had meaningful theatrical pull. Distributors and investors quoted anonymously by Asia Economy call the six months "excessive," warning it strips revenue during the window when a film's commercial value is highest, discourages OTT and IPTV platforms from paying acquisition premiums up front, and imposes the restriction only on distributors — theaters face no reciprocal obligation, such as guaranteed screen counts or minimum runtimes, in exchange for the protection Asia Economy. A lawyer representing opposing industry groups was blunter, telling SBS the bill amounts to a "blackout," not a holdback, because it locks up content with no corresponding commitment from theaters to actually program it SBS News. The exemptions for small and independent films are a tacit admission of the core flaw: a flat calendar rule imposed on a business where most titles depend on fast, flexible monetization is a blunt instrument dressed up as an industrial policy.
The better model already exists, and it's not legislation
South Korea's Ministry of Culture, Sports and Tourism and the Korean Film Council convened exactly this recognition when they launched a 22-member Public-Private Consultative Body for Improving Korean Film Distribution Structure, holding its first session on May 29, 2026 with representation from production, distribution, exhibition, TVOD, and SVOD interests plus Culture Minister Choi Hwi-young Korea.kr. The body's mandate is to negotiate a voluntary "Holdback Agreement for Korean Film Industry Coexistence" by August 2026 — the same month the National Assembly bill is still moving The Korea Herald. A negotiated agreement can do what a statute structurally cannot: vary the window by budget tier or genre, pair any holdback with exhibitor commitments on screen access, and adjust as streaming economics shift — all without a fixed fine schedule baked into a law that will be nearly impossible to amend once distribution patterns change again, as they reliably have every few years since the pandemic.
What proportionate looks like here
We've argued consistently that content-distribution mandates tend to freeze in yesterday's business model just as the market is adapting past it — the same critique that applies to European streaming-investment quotas applies here. South Korea's theater crisis is real and the underlying complaint — that global platforms have unilaterally dissolved a coordination norm the industry once relied on — is legitimate. But the fix belongs in a negotiated agreement among the parties who actually bear the costs and benefits, not in a criminal-adjacent fine schedule administered by the state. If the consultative body reaches a deal by its self-imposed August deadline, lawmakers should treat that as a reason to shelve Lim's bill, not merely soften it. A voluntary agreement can be renegotiated when it stops working. A statute, especially one that already needed four exemption carve-outs to avoid obvious collateral damage, mostly just needs to be repealed.