South Korea’s three major mobile operators – SK Telecom, KT and LG Uplus – opted not to take legal action against a government move to increase the discount they are required to pass on to customers signing new contracts, Yonhap News Agency reported.

Earlier this month the Ministry of Science and ICT said it would raise the discount mobile operators must offer customers who sign up for new one- or two-year contracts from 20 per cent to 25 per cent effective from 15 September.

The increase, part of President Moon Jae-in’s campaign pledge to reduce telecoms expenses, faced stiff opposition from operators which were concerned the move would impact profits. Some suggested they would take legal action.

However, the three companies said they would accept the higher discount rate, the ministry said in a statement.

President Moon had promised to eliminate the basic mobile subscription fee of KRW11,000 ($9.75), but dropped the controversial plan in June after the proposal was strongly criticised by operators. The government opted not to push for the elimination of the basic fee, but sought savings in other areas.

The higher discount means a new customer signing a two-year contact with a monthly fee of KRW40,000 will receive a KRW10,000 discount, Yonhap News Agency said.