Monday, April 14, 2014

The Power of Samsung in Korea: Ways to Protect your Business from the Powers to Be in Korea

Bloomberg Business Week published a few days back a great article on the power of Samsung in Korea. Many foreign and domestic businesses in Korea have run afoul of the Big Blue and have been crushed because of local Korean realities.   

The more savvy of companies, dealing with Samsung and like companies in Korea,  have used some creative business strategies and contract clauses that has helped to minimize damages caused by relationships with Samsung and the like that go bad.  

The article, below, does not address these business strategies or contract clauses, but a follow-up post on this blog will brief the reader on some of the businesses strategies and contract clauses that have help to protect our international clients from issues caused by these Korean realities.  

Please take a look at the article from Bloomberg Business Week at:Samsung's War at Home by Cam Simpson.
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info@ipglegal.com

Monday, March 17, 2014

The Irish's Gift to the World by Senior Advisor to IPG: No not Guinness

Tom Coyner posted another very interesting piece in the Korean Joonang Daily on the history of St. Patrick and his holiday. 

The article in the Korea Joonang Daily notes, in part, that:
"While Ireland’s national holiday up through the mid-20th century was a relatively quiet day at church, the Irish diaspora around the world was meanwhile turning the day into something quite else. On St. Patrick’s Day, 1762, Irish soldiers stationed in New York City organized a march with the shamrock clovers in their lapels to differentiate themselves from other British troops. The notion struck the expatriate Irish so well that it eventually became a tradition for St. Patrick’s Day parades elsewhere. Eventually, the parade tradition spread throughout the United States and Canada. Eventually the notion expanded to other major destinations of Irish emigrants."
For more information on a great Irish-American tradition that spread throughout the world please see Tom's article at: Ireland's Gift to the World.  

Very sad that Guinness (under Diageo-British MNC) has failed to sponsor the Irish Festivities in Korea this year, while, they sponsor parades and Irish events in most major cities around the world.  It must be noted, that Guinness is no longer owned by an Irish company and in parts of the world it is not marketed as a traditionally Irish beer.  I guess the Irishness of Guinness is not within the marketing strategy for Korea.  Very sad.

info@ipglegal.com

Friday, March 14, 2014

Sean Hayes to give Speech at American Bar Association Conference in LA

Sean Hayes will give a presentation entitled Mickey Mouse, Sports Stars, Celebrities, Billions of Dollars at Stake. Who Owns the Rights to an Individual’s or a Character’s Image? 10:30 – 12:30 April 11, 2014.

The speech is part of the ABA Business Law Spring Meeting in LA.  More information can be found at: ABA
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info@ipglegal.com

Monday, March 10, 2014

Foreign Tax Incentives to be Cut: 17% Flat Tax Law Revised

Special Income Tax Regime for Foreign Workers under Article 18-2 of the Special Tax Treatment Control Act has been amended.  Now the 17% flat tax will, only, apply to:
  1. Employees that are not related parties to their employers.  An exception applies to companies that are authorized to receive tax incentives; and
  2. Employees for, only, a 5-year period. 
Not happy news for many foreigners in Korea. 
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Sean Hayes may be contacted at: SeanHayes@ipglegal.com.

Sean Hayes is co-chair of the Korea Practice Team at IPG Legal.  He is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty. He has, recently, been ranked as one of only two non-Korean attorneys as a Top Attorney working in Korea by AsiaLaw.

Friday, March 7, 2014

Korea's Free Trade Agreement with Canada: Will it Pass?

Korea is near to inking an FTA with Canada.  This agreement will be the first FTA for Canada with an Asia-Pacific nation.  The major hurdle, for Canada, in execution of this agreement is opposition from labor unions and the auto industry.

The Canadian auto industry is, particularly, concerned with the numerous non-trade barriers in Korea.  Increasingly, American automobile industry has been vigorously fighting Korea to drop regulations that seem to, only, benefit the local car manufacturers to the detriment of importers.  The Canadian auto industry is fighting the deal with U.S. stats. 

The CEO of Ford Canada was quoted by the The Star as saying that: "the challenge with South Korea - we've been very strong in our opposition to it - is it's not going to be a fair deal.... It is a closed market. We're very fearful of what this means to Canada. There's no upside, only downside . . . We want fair trade."  This sentiment is echoed by many in the West.

However, many industries will benefit from this deal.  The largest industries that we believe will benefit from this deal are food processors, basic material companies, and agricultural companies.  We suspect a boom in business in these sectors. 

We suspect the deal will pass and, thus, those in industries that suspect a benefit from the 50 million head Korean market should consider exploring the market now - get the jump on your competition.

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 Sean Hayes may be contacted at: SeanHayes@ipglegal.com.

Sean Hayes is co-chair of the Korea Practice Team at IPG Legal. He is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty. He has, recently, been ranked as one of only two non-Korean attorneys as a Top Attorney working in Korea by AsiaLaw.

Wednesday, March 5, 2014

Korea Assisting Mongolian Peace Keeping Efforts with Korean Military Equipment

Korea has pledged, via the signing of a defense cooperation agreement with Mongolia, to ship 15 used military vehicles to Mongolia.  The vehicles to be shipped seem to be low-tech non-tactical vehicles including bulldozers and cranes.  The vehicles are, likely, to be utilized by the military for not only military purposes, but civilian purposes, since the military, in Mongolia, plays a vital role in Mongolian infrastructure projects.

Korea has received a good deal of criticisms for being one of the lowest contributors in the OECD to international humanitarian projects.  The Korean government has, recently, stepped-up its efforts
in contributing to the international community. 
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info@ipglegal.com

Friday, February 28, 2014

Garnishing Wages in Korea: Collection of Debts in Korea

I received a call from a friend asking about information concerning collecting on a large personal debt. He loaned money to a “friend” and the friend never made a payment on the loan. Word to the wise, don't make large loans to friends----cry poverty instead.

In Korea, after a judgment or order to pay by a court, a plaintiff can collect on an unpaid debt through garnishing wages. Garnishing of wages is normally the best way to guarantee the collection of debt when a debtor doesn’t have real or personal property.  Most law firms can perform the service for a modest fee.

Amount that May be Garnished in Korea
  • Less than W1.2mil (No wages can be garnished)
  • W1.2mil - W2.4mil (Monthly Wage – W1.2mil)
  • W2.4mil –W6mil (1/2 Monthly Wage)
  • Over W6mil (Half monthly Wage minus W3mil divided by two plus W3mil minus monthly wage)
Examples:
1. W2,000,000 Monthly Pay (Can garnish monthly W800,000)
2. W3,000,000 Monthly (Can garnish monthly W1,500,000)
3. W5,000,000 Monthly Pay (Can garnish W2,500,000)
4. W6,000,000 Monthly Pay(Can garnish W3,000,000)
5. W12,000,000 Monthly Pay (Can garnish W7.500,000)
6. W20,000,000 Monthly Pay (Can garnish W13,500,000)

The following post was first posed in 2008.
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info@ipglegal.com

Required Traits of a Great Criminal Lawyer in Korea: Hiring a Defense Lawyer in South Korea

There are few great criminal lawyers working in Korea, because of the nature of the Korean criminal justice system and other realities.

In Korea, in all cases, where you are accused of a crime and you fear that you may be sentenced to time in a Korean jail, may be deported from Korea or the Korean conviction may harm your future - hire, quickly, an experienced and proactive attorney in Korea with experience in Korean criminal law prior to any interrogations by the Korean police or prosecution.

As I mentioned in a post entitled Criminal Defense Lawyers in Korea: Who to Hire - Who Not to Hire:
"Sadly, few lawyers, in Korea, are useful for criminal matters, since few lawyers are proactive when it comes to matters concerning the Korean government, experienced in criminal matters for foreigners or willing to upset the status quo (aggressively engage the prosecutor)"
Here are a few signs that you may have hired a good Korean Defense attorney.
  • Your lawyer is operating based on a success/contingency fee (bonus for not going to jail).  If your Korean lawyer is not operating based on a contingency/success fee he may not be motivated to win the case.   The best arrangement is a discounted hourly fee combined with a success fee, since you will receive a bill noting what the attorney is doing and the attorney will be motivated to do work on the matter even when the chance of "success" is slim.
  • Your lawyer doesn't work for one of the ubiquitous firms working for foreign clients.  Some of these firms are more concerned with their reputation than yours.   Many are notoriously bad in criminal cases.
  • Your Korean lawyer is between the age of 40 and 60.  If the lawyer is too young (Early 30s) or too old (70s).  The lawyer will, likely, not have the experience necessary to handle the matter or will, simply, not be handling the matter.
  • You talk directly with your Korean lawyer every time you meet the lawyer.   If you lawyer is directing you, consistently, to talk with a less experienced lawyer - run.  The less experienced lawyer is likely, only, doing the work and the more experienced lawyer is simply a rainmaker.
  • Your Korean lawyer has great English language skills.  Without someone fluent in English, you run the risk of never getting your side of the story heard. 
  • Your Korean lawyer has many non-Korean clients.  Handling criminal matters for foreigners is vastly different than handling a typical criminal matter for a Korean.  Often, deals can be obtained with the Korean prosecutor in non-violent crimes for foreigners, that are unavailable to Koreans.  Also, violent and public crimes, often, need to be handled with a decree of media and cultural savvy, since judges and prosecutors are heavily affected when the victim is a Korean and the perpetrator of the crime is a foreigner. 
  • Your lawyer contacts you often, meets you in jail often and leads the conversation.  A lawyer that never speaks, never contacts you and never visits you is, typically, not a proactive lawyer.  Criminal cases are best handled with strategy and a proactive counsel willing to engage the police investigators, prosecutor and judge.  If your lawyer won't speak to you, he won't be speaking to anyone else and will likely simply go through the process, receive a guilty verdict and the typical sentence.
  • Your lawyer speaks, but, also, listens when you talk.  Too often, lawyers, ignore clients.  Great defense lawyers in Korea develop great defenses by listening and responding to clients.  If you have a lawyer that is not listening, he will likely just go through the process, receive a guilty verdict and the typical sentence.
  • Your lawyer in Korea seems busy, but not overwhelmed.  If he seems too busy he probably is too busy.  Criminal cases, often, need a great deal of time.  If the lawyer is not able to spend the time to talk with you, you may never be able to get the attorney to provide the time necessary to handle the matter.
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Sean Hayes may be contacted at: SeanHayes@ipglegal.com.

Sean Hayes is co-chair of the Korea Practice Team at IPG Legal. He is the only non-Korean to have worked as an attorney for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty.

Tuesday, February 25, 2014

Why we should care about North Korea?: North's Harsh Reality by Senior Advisor Tom Coyner

While reading Foreign Minister Yun Byung-se’s essay “Preparing for Reunification” in the Feb. 13 edition of the Korea JoongAng Daily, I felt both empathy and frustration. But in the end, I can understand why diplomats continue to make seemingly ludicrous, even quixotic, demands of North Korea.

The minister’s column reminded me of a white paper I recently edited for a major Korean research center. The white paper summarized extensive investigations by think tanks of the six-party talk nations, with the exception of North Korea. The shared study looked at nation rebuilding in a reintegrated Korea. Each contributing think tank considered what would need to be done within Korea and what would be the costs and benefits to its own nation as Korea reunified.

To cut to the chase, the paper almost unintentionally detailed how disruptive the DPRK is by its very existence. DPRK is the acronym of North Korea’s official name, the Democratic People’s Republic of Korea. It detailed how not only the Koreans, but also the greater international community, including China and Russia, will substantially benefit, in their own self-defined terms, by Korean unification. As may be expected, the independent research teams’ national interests naturally fell into two groups: China and Russia versus the other nations, particularly regarding the post-reunification ROK-U.S. relationship. On the other hand, all five nations found major benefits from reunification. In other words, all the research groups concluded the ensuing costs from a post-DPRK soft landing would make for good long-term returns.

To us in the West, it’s obvious the North Korean government’s isolationist practices forces South Korea to behave more like an island nation than a peninsular one. What is less apparent to us is how much the DPRK acts as a brake on the development of northeast China and southeast Russia. Both neighbors are required to place otherwise needless military allocations in those regions to address North Korea-related smuggling and illegal fishing as well as creating a defense for possible refugee inundations should the Pyongyang government fail. Particularly in the case of China, North Korean refugees have long been a regular source of civic disruption and international censure. Clearly, this is one problem the Chinese would love to see go away.

As former Communist nations, North Korea’s neighbors feel obligated to support their wayward ally, if only to counter what they perceive as U.S. hegemony. Yet, in supporting Pyongyang, large areas tangential to the DPRK borders remain economically underdeveloped compared to the rest of their nations. These neighboring regions are relatively isolated when, in fact, they could be major crossroads between the Pacific region and the rest of their national economies.

So, given all of the latent economic potential surrounding the DPRK in a post-unified Korea, one could naively think that in due time economic factors will triumph and the two Koreas will become one. And that is where the frustration comes in.

Even by Communist standards, the DPRK is essentially a political state with occasional economic tendencies. Recalling the quiet denouement of the cold war, we may argue that what happened was not so much the result of capitalism’s triumph but communism’s demise by self-inflicted wounds. The Soviet bloc’s political dogma ran roughshod over practical economics. Meanwhile, other Communist nations began making major adjustments that allowed capitalism to develop, albeit under Communist monopolistic rule. That is, all but one - North Korea.

The problem remains that the Korean Workers’ Party has ruthlessly and effectively governed a relatively small geography for more than six decades, resulting in the direct and indirect deaths of millions of people from political and economic mismanagement. As a result, the ruling oligarchy must be anxious about retribution by the masses once the big lie becomes widely known. Any change, even for the potential better, is scrutinized in terms of possibly setting off a cascade of events that may weaken the oligarchy’s total control. At the same time, by most accounts, virtually all North Koreans support and identify with their leadership in facing the supposed threat by the surrounding hostile powers, led by the United States. As such, harsh political measures that come at the expense of economic well-being are accepted by the North Korean masses as being inevitable, given the perceived external perils.

In other words, not only the ruling oligarchy, but also the rank and file of North Koreans are political actors with minimal economic interests. Meanwhile, the overall regional community increasingly recognizes the economic drag of the DPRK on this part of the world. But that is of little concern to the North Koreans, given their dedication to continue within their created political paradigm.

For these reasons, reasonable demands for Pyongyang to denuclearize and to become economically integrated with its neighbors are pure nonsense in practical terms. It really should not be so, but that is actually the case - no matter how reasonable political and economic leaders may suggest otherwise.

But the outside world still needs to make sensible yet impractical calls for North Korea to take measures to denuclearize and to liberalize its market. We have no choice. For the international community to recognize North Korea’s overly political rationale for the status quo, including a necessity to hold on to its nukes, etc., would require the world to succumb to DPRK’s warped definition of reality.

Dealing with the DPRK is very much like being Alice in Wonderland. If one thinks in accordance with Wonderland madness, ultimately one loses one’s integrity - and possibly one’s sanity. And yet the Wonderland denizens cannot accept any other reality. Diplomacy does not get any more frustrating than that.

*The author is the president of Soft Landing Consulting, a sales-focused business development firm, and senior adviser to IPG Legal.   The post appeared in the Korean Joongang Ilbo at: Dealing with the North's Harsh Reality

By Tom Coyner 
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info@ipglegal.com

Monday, February 24, 2014

Using Korea as a Test Bed for Asian Expansion: Look to Facebook

I have advised, on many occasions, clients to look to Korea for their Asian expansion prior to entering more expensive and difficult Asian market - hey Facebook seems to agree in an article entitled: Facebook uses Korea as Test Bed.

The Korea Herald has an interesting article that quotes the president of Facebook Korea as noting that:
 "Facebook sees Korea as an important country due to its high mobile usage and the presence of global companies like Samsung and Hyundai,” he said. “This makes Korea an important test bed to Facebook (insofar as it is) wishing to be a mobile-first company.”
We strongly recommend that all companies consider Korea as a useful "test bed" in determining if Asia will be a success for your brand, franchise, technology etc. 

This advise is, also, the advise of the former head of the European Chamber in Korea that noted in the EU Chamber Infomag in 2011 that: "While the world focuses on the Chinese market, company executives should also try to include Korea in their itinerary whenever they visit this part of the world, because a presence in South Korea is indispensable for truly global brands and could in fact constitute an excellent launching pad to reach the Chinese and Japanese markets."
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Sean Hayes may be contacted at: SeanHayes@ipglegal.com. Sean Hayes is co-chair of the Korea Practice Team at IPG Legal.

He is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty. He has, recently, been ranked as one of only two non-Korean attorneys as a Top Attorney working in Korea by AsiaLaw.

Friday, February 21, 2014

Weekly Korean Legal News from International Law Firm - IPG Legal

This Week's Korean Legal News Reported by the Media
Most Recent Posts from The Korean Law Blog
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Sean Hayes may be contacted at: SeanHayes@ipglegal.com. Sean Hayes is co-chair of the Korea Practice Team at IPG Legal. He is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty. He has, recently, been ranked as one of only two non-Korean attorneys as a Top Attorney working in Korea by AsiaLaw.