3/30/2016

A Franchisor may be Unable to Prosecute a Franchisee for Embezzlement in Korea

Article 355 of Korea's Criminal Act defines embezzlement as: "a person who, having the custody of another's property, embezzles or refuses to return the property shall be punished by imprisonment for not more than five years or a fine not exceeding fifteen million won."

In a landmark case in Korea's Franchise Jurisprudence, the Supreme Court ruled a franchisee may not be held criminally liable for embezzlement for "arbitrary spending of funds" and not paying franchise fees under the franchise agreement, since the Supreme Court deemed that the funds are not funds held, in short, in trust for the franchisor and the franchisor did not maintain a PNL (partnership-like) relationship with the franchisee.

Franchisors in Korea, must, carefully monitor the financial situation of franchisees.  Often when franchises fail in Korea, the franchise fees are of the last priority.  Korea has pre-litigation measures that may be utilized to assist in guaranteeing franchise fees are paid - including attaching rental deposits, receivables and even movables.

Act quick.  Often, franchises, in Korea, fail as fast as they open.
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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. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw. Sean's profile may be found at: Sean C. Hayes

3/24/2016

Searching Trademark & Service Marks in Korea: Register your Trademarks/Service Marks Prior to Doing Business in Korea

Prior to marketing products, services or a business in Korea do a thorough search for like trademarks/service marks in Korea, then, have your trademarks/service marks registered in Korea - if you don't want the added cost of litigating a matter at a Korean court.  If you have patents, don't forget to, also, register your patents and other intellectual property.

Korean Trademark Search Attorney
Your U.S. and E.U. trademark, service mark and patent filings are not enough. These "international filings" only gives you a grace period to file outside of these jurisdictions. 

The Korea Intellectual Property Organization has a website, in English, that has a decent search system.  Regrettably, not all of the information on the site is in English.  This search is not the end of the matter.  You should, obviously, also hire a professional to assist.

Upon filing, also, make sure you develop at strategy to protect your Intellectual Property.  Your strategy should, include, at a minimum:
  1. Comprehensive Intellectual Property Audit. 
    Audit all your intellectual property including your patents, trademarks, servicemarks, books, manuals, videos, software, know-how, and trade secrets.  The purpose of this IP Audit is to determine if all of your IP is registered and properly safeguarded.  This is discussed more at: Protecting Your Intellectual Property in Korea.
  2. Educate Korean Customs
    A few professionals in Korea, including professionals at IPG, do presentations to Customs informing Korean Customs of how to spot counterfeit products.
  3. Engage Actively Customs and the Prosecution
    If you are not on-the-ground in Korea, get a local company to assist.
  4.  Draft a Comprehensive Intellectual Property Protection Plans.
     If you don't have an IP department or have a IP department that is not up to the task in your  company the inexpensive way to do this is to outsource the work.  Please consult with your in house attorney or a private attorney.

  5. Track Importers of Counterfeit Products into Korea
    The Prosecution, generally, does a decent job.  However, often it is advisable to employ a professional to obtain the necessary information and present the information to the Prosecution and Customs.
  6. Actively Engage your Sales Channels
    So much information can be garnered from those that are competing against counterfeiters and pirates. 
  7. Integrate the Office Outside Korea with the Korean entity. 
    All too often a Korean branch is totally out of the loop and hence unaware of developments at the home office.
  8. Trade Secrets Matter. 
    I wrote an article on protecting trade secrets in Korea that may be found at: Protecting your Trade Secrets in Korea: Top 5 Things to Know Before Subjecting your Business to the Korean Market.
  9. Search the Internet, Government Databases and Portals to Find Violators of Your IP. Get someone to do this, at least, on a monthly basis. 
  10. Get Professional Assistance
    Speaks for itself.

The Korea Intellectual Property Trademark/Service Mark search may be found at: Korea Intellectual Property Rights Information Service.
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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. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw.

3/15/2016

Happy St. Patrick's Day from IPG Legal

All of us here at IPG Legal would like to wish you the most Happy St. Patrick's Day.  St. Patrick's Day is a special time of the year for the Irish diaspora, the Irish at home and for those interested in some craic (Irish world, broadly, for fun).

We wish you a safe and happy St. Patrick's Day.

 

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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. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw.

Sean's profile may be found at: Sean C. Hayes

3/08/2016

Waivers of Liability in Korea: Civil Liability Basics

Waivers of liability, in Korea, are often deemed invalid by courts when the actions of the business is considered negligent by the Korean court.  Thus, the signing of a waiver does not, often, preclude the ability to sue or be sued.

However, it is still advisable for a company operating in a business that is inherently dangerous to have liability waivers in contracts with their customers (e.g. scuba, paragliding, and skiing).
Korea Law Liability Waiver

In most cases, the courts will deem the waiver to be limited to injuries caused, directly and soley, by the actions of the injured plaintiff.

Thus, for example, if you are skiing and you hit a tree that you claim was negligently placed too near to the exit of a ski lift, you likely, will lose the case, since the injury was caused by your actions of skiing into the lift.  This assumes that the lift or tree was not placed in an area that has caused many similar accidents. 

However, if the lift breaks and you fall to a snowy death and you successfully find that the maintenance of the lift was completed by Mork & his friend Mindy, you likely will prevail.

Thus, for enforceablility of these waivers of liability, typically, a court would need to find that no responsibility of the business in the accident.

Yes, you have a good question - what the heck is the use of the waiver?  Shouldn't a court, only, award damages if a party is negligent.  You got a great point.  The waiver seems to do nothing, but raise a strict liability standard (usually when one party is hurt by the actions/inactions of another party - compensation is provided, in Korea, not withstanding negligence).  The waiver may, in some cases, bring the standard to a true negligence test.  Also, it often scares of lawsuits.
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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. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw. Sean's profile may be found at: Sean C. Hayes

2/18/2016

Fleeing Korea while under Police/Prosecutor Investigation: International Hold in Korea

We have, recently, learned that even if the Korean prosecution/police have not requested that an accused be placed on an international hold, some records of police investigations, indictments and proposed fines and sentences by the prosecution/police are being reported to the Korean Immigration Service.

An international hold, in Korea, is an official procedure that flags passports and fingerprints and prevents one under this international hold from departing Korea prior to the lifting of the international hold.

Even if you are not under an official international hold, Korea Immigration may refuse your departure based on information from data being shared between the Police, Prosecution, National Tax Service and other Korean government agencies.  Please note that the Korea Immigration is a branch of the Ministry of Justice. The Ministry of Justice is in charge of the majority of prosecutions in Korea. 

Thus, in short, someone under investigation in Korea may be stopped at the airport even if not under an official international hold.  

Thus after arrest, fleeing to the airport may not be advisable.  If you are perceived to being fleeing Korea, things may get much worse. 

Other articles on Korean criminal law and criminal attorneys that may be of interest:
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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. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw.

1/26/2016

Legal & Accounting Assistance for Startups in Korea

My law firm is, regrettably, not known for assisting SMEs and startups, because of our representation of your lawyers working with some well known multi-national companies.

However, we do have a number of forward-thinking startups and SMEs that we assist in Korea and in China.  We love working with these companies, since we love being an active part in developing systems within businesses that allows growth with less of the compliance risks.

We, also, love being a part of the business of companies.  Many of our attorneys and business professionals have experience with managing companies and assisting companies to find new opportunities and we love to see this experience help our clients succeed.

For example, we work with:

  1. A 50 employee American online advertising agency;
  2. A startup British cyber-security company;
  3. A startup American mobile technology company;
  4. A startup Chinese entertainment company;
  5. A 15 employee American-owned grocery store;
  6. A 5 employee Korean-owned distribution company;
  7. A startup Canadian-owned brewery; 
  8. A Italian restaurant franchise owned by an Italian; and 
  9. A 220+ employee nano-materials company.  
We work with these clients based on, often, low monthly retainers and flat-fee services.  Yes, legal services are not cheap, however, I doubt you will find many of our clients complaining that are services did not add value to the respective business.  

We, also, have many clients that we have introduced to new business.  Yes, little guys can, often, utilize the services of lawyers.  

Regrettably, few lawyers, in Korea, are capable of dealing with the needs of startups and SMEs in Korea, thus, my law firm has created a team to address and handle the needs of these clients.  

You will see, over the next few weeks, more articles tailored to the needs of clients requiring the need for small-business focused lawyers. We, also, will have an accountant at our firm write a few articles.  
Please check back soon.  

You can subscribe to the blog via a field in the right column of this blog.  
Also, I love to talking to anyone.  Setup a time for a call with me and I am happy to discuss with you the needs for your business.  

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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. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw.

Sean's profile may be found at: Sean C. Hayes

1/22/2016

Business with North Korea: The Growing North Korean Economy

In a little break from writing about mundane Korean legal topic, here is an article from the Washington Post that sheds a little light on the North Korean economy.  Well worth a read.

The economy in North Korea is growing, mainly, because of the contributions of Korean workers working outside North Korea in Chinese owned textile mills, mines, restaurants and other industries shunned by the, increasingly, wealthy Chinese workers.
 
The Washington Post has a great article on this situation.  The article, notes, in part that:
North Korean Gaesong Industrial Complex Law
Gaesong Industrial Complex in North Korea
"In the clothing factory, the women work 13 hours a day, 28 or 29 days a month, and are paid $300 each a month — one-third of which they keep. The rest goes back to the government in Pyongyang.
'Even though I want to pay them more, I have to send a certain amount home to my country, so this is all I can give them,' Kim said in his office at the factory.
On his desk, an open laptop revealed that visitors had interrupted his game of solitaire.
The women work on the third floor, wearing their coats inside to guard against the cold, and live on the second floor in shared, dormitory-style rooms decorated with a banner declaring, “Let’s realize the revolutionary ideas of Kim Il Sung and Kim Jong Il” alongside portraits of the two former leaders, grandfather and father, respectively, of Kim Jong Un. Signs on the doors read, 'Call each other comrade.'
North Korea is thought to have at least 50,000 workers outside the country earning money for the regime, and 13,000 of them work in Dandong.
This neon explosion of a city contrasts starkly with the North Korean city of Sinuiju, on the opposite bank of the river, where there is only a smattering of light at night."
The article may be found at: North Korea's Growing Economy and America's Misconception About it. Worth a read.  Back to the boring legal article for tomorrow. 

The Chinese government, near the Chinese boarded, has established textile manufacturing zones run by Korean workers. 
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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. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw.