The controversy of limiting screen quotas initially stemmed from South Korea-America BIT (Bilateral Investment Treaty).
When the decision to limit screen quotas was notified to the public, however, the Korean movie industry vehemently opposed the change.
By 2004, the South Korean government suggested FTA (Free Trade Agreement) rather than BIT but the United States was hesitant in considering it.
The American government urged that South Korea cannot start FTA and continue screen quotas act at the same time.
Moreover, President Roh Muhyeon had a firm belief that South Korea – America FTA should be signed as fast as possible, with all the obstacles such as screen quotas being solved quickly.
The Act's supporters believed that this would promote the emergence of a vertically integrated film industry, in which production, distribution and exhibition infrastructure are controlled by the same companies.
The vertically integrated American film industry saw rapid growth in the years immediately following the end of World War I.
The idea, therefore, was to try and counter Hollywood's perceived economic and cultural dominance by promoting similar business practices among British studios, distributors and cinema chains.
By creating an artificial market for British films, it was hoped that the increased economic activity in the production sector would eventually lead to the growth of a self-sustaining industry.