Korean Data Privacy Act: Need for Compliance Audit for your Korean Company

The European Union General Data Protection Regulation (EU GDPR) focuses on the data security of personal data of users of the internet. As the EU offers a potentially lucrative market for online businesses for many Korean companies, South Korea was eager to amend its existing Act on the Promotion of IT Network Use and Information Protection of Korea (“Korean Network Act”) based, at least, partially on bench-marking of the EU GDPR. We suggest all companies, doing business in Korea, conduct via a professional in data privacy – a compliance audit. We suggest the professional has an understanding of not, only, Korean Law, but the law of the European Union as it relates to data privacy. Fines and criminal penalties for violation of data privacy laws have increased in Korea. Korean Network ActThe Korean Network Act was amended in December of 2018. Korea, the EU and other nations are in ongoing

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Minimum Wage Raised in Korea for 2020: Employment Law Updates

South Korea has chosen to raise the minimum wage by 2.9% for 2020 to KRW 8,590 (c. USD 7.11).  The Minimum Wage Commission of Korea set the wage at a lower than expected increase because of deteriorating economic conditions in Korea. President Moon’s plan to raise the minimum wage to KRW 10,000 per hour shall fall short, because of, among other things, a slower than expected growth rate and regional geopolitical issues facing Korea.  We shall keep the reader updated when more is known. (c) Sean Hayes – SJ IPG. All Rights reserved.  Do not duplicate any content on this blog without the express written permission of the author. [email protected]

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Korea Amends the Act on the Employment, etc. of Foreign Workers in 2019: Employment Law Updates

Amendment to the Act of the Employment, etc. of Foreign Workers in Korea (hereinafter as “Amendment to the Act of the Employment of Foreign Workers” of Korea) was proposed by the Korean Environment and Labor Committee in December 2018. The focus of the Amendment of the Employment of Foreign Workers is on the improvement of the living conditions of foreign workers at dormitories provided by their companies. Major Changes Due to the Amendment and the Struggles on the Way Addition of Criteria for the Dormitories to the Requirements to Obtain Permission for Hiring Foreign Workers in Korea? The original bill contained the regulation in Art 8 (3) Act of the Employment of Foreign Workers that the criteria for dormitories shall be added to the requirements that employers in Korea must meet in order to receive permission to hire foreign workers, if they – in general – provide dormitories to foreign

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The New Korean In Vitro Diagnostic Medical Devices Act 2020

As proposed in April 2019 by the Korean Chair of the Health and Welfare Committee, the Korean In Vitro Diagnostic Medical Devices Act (hereinafter as “Korean In Vitro Act”) intends to, among other things,: “…ensure the safety and quality of in vitro diagnostic medical devices, to strengthen global competitiveness thereof, and furthermore, to contribute to the improvement of public health and the development of vitro diagnostic medical devices, by specifying matters concerning the manufacture, import, management, and support of such devices” (Korean In vitro Act, Purpose). Major Regulations of the Korean In Vitro Act 2020 The Minister of Food and Drug Safety “…shall classify and designate the class of each in vitro diagnostic medical device in conformity with the intended use of each device and differences in their potential risks to individual and/or public health.” If someone intend to manufacture or import in vitro diagnostic medical devices, he or she

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Korean Wills: Korean Estate Law Basics

Like in most jurisdictions, the recognition of a will by a court of law requires precise formalities.  We advise that most people have a will.  For individuals with wills that shall be governed by Korean Law the formalities are noted below.  We have omitted two forms of wills – a will by audio recording and dictation. These types of wills pose issues of authentication of the decadent and we believe it is not advisable – in most cases. Korean Holographic Wills A Holographic will is a handwritten will.  For a holographic will to be enforceable in Korea the will should meet the following formalities: Written by the descendant Dated Signed Note the descendant’s name and address Sealed or contain a thumbprint. Additional details on holographic will may be found at: Korean Holographic Wills  Korean Notarized Wills Will is executed before a Korean notary Two witnesses should be present at the notary

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Exclusion of Japan from Export/Import White List

South Korea is on track toward barring Japan from its export control white list this month, in a blow for blow reaction to Tokyo’s prior choice to expel Seoul from its favored nation trading regime. On July 1, 2019 the Japanese government restricted the export to Korea of three classes of materials: fluorinated polyimide, photoresist and hydrogen fluoride.  These chemicals are utilized in important export-driven manufacturing operations in Korea.  Seemingly, the restriction is in reaction to a Korean Supreme Court case concerning liability of Japanese companies to the Korean victims of WWII sex slavery. Starting in July, the total volume of imports of these three materials remained at $800 billion and represented around 1.8 percent of all imports from Japan. The restrictions have not prompted any imminent problems for Korean manufacturer according to the Korean Ministry of Trade, Industry & Energy. It was announced by the Korean Ministry of Trade,

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Korea’s Amendment to the Act on the Arrival, Departure, etc. of Ships: Korean Shipping Law

Dangerous substances, illegal substances and other controlled substances are believed, in Korea, to be more often transported by ships into Korean waters. Thus, the Korean government has amended a giving act concerning Korean Shipping Law. To, among other things, increase transparency of what is being shipped, the Korean Act on the Arrival, Departure, etc. of Ships (hereinafter as “Act on Ships” or “Korean Shipping Act”) was amended. The Korean Act on Ships, in general, establishes regulations concerning the arrival and departure of ships, as well as sets up safety measures in Korea. The Amendment was propoed in December of 2018. The Amendment was proposed by the Chair of the Agriculture, Food, Rural Affairs, Oceans and Fisheries Committee. Korean Shipping Act stipulates that shipping companies, which share the same shipping route and transport dangerous products, shall share accurate information. The Amended Korean Shipping Act shall become effective from July 2019. Overview

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Amendment to Korea’s Intellectual Property Registration System: Korea IP Law Updates

South Korean organizations, companies and startups will, likely, in the near future experience a quicker and increasingly more efficient Patent and Intellectual Property Registration System in Korea and internationally based on developments within the IP5. Top IP officials in Korea are gearing up, in order to help South Korean organizations, companies and startups register their Intellectual Property more efficiently.  It seems like the effort is a serious attempt to expedite approvals and lesson application burdens for those doing business in Korea. IP officials from Korea, the United States, China, Japan and the European Union (a.k.a IP5) recently gathered in Incheon and asserted that they shall utilize A.I. technology and other future advances to improve the worldwide Patent Application System. To accomplish this objective, IP5 consented to organize a research team, containing Patent and IT specialists from these four countries and the EU. This team will start working on an A.I.

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Korea Establishes Legal Grounds for the Commercialization of Autonomous Vehicles – A New Act for 2020

Proposed by the Chair of the Land, Infrastructure and Transport Committee on April 4, 2019, the Act on Promotion and Support of the Commercialization of Autonomous Vehicles (hereinafter as “Korean Act on Autonomous Vehicles”) aims to set forward legal grounds and a legal framework for projects of domestic and foreign companies, who focus on the development of autonomous or self-driving vehicles with the goal of the successful commercialization in Korea and abroad. The aforementioned Act shall become effective one year after promulgation. We shall update the reader when more is known. The Role of the Koran Motor Vehicle Management Act The Korean Motor Vehicle Management Act provides only general regulations about autonomous vehicles, thus, the Korean government believed a more robust regulatory framework was necessary. According to Art 2 (1-3) of the Korean Motor Vehicle Management Act an “autonomous driving motor vehicle” is “…a motor vehicle which can self operate

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Terminate/Layoff an Employee in Korea: Terminating an Employee in Korea

The Korean Labor Standards Act mandates that employees under “contract” or “regular employees” may only be terminated for “justifiable reason attributable” to the employee or “urgent managerial necessity” after the completion of the employee’s probationary period. Both Korean employment law standards are, often, difficult for an employer to meet without the professional structuring of HR policies and procedures and a nuanced approach to termination of employees in Korea. We strongly recommend, prior to even considering firing or laying off Korean workers, to put a system of internal controls/systems in place that provides evidence to substantiate Korean employment terminations decisions.  We see too many companies in Korea that lack the systems necessary to substantiate termination.  Modest changes can, often, be refreshing for managers. FYI – Company executives/directors are, normally, not considered company “employees” and thus are not benefited by most of the protections afforded by the Korean Labor Standards Act.  However,

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English-Speaking Korean Labor & Employment Lawyers in Korea

This Korean Law Blog is brought to you by English-speaking Korean labor lawyers & employment lawyers working for IPG Legal – an international law firm with offices in Korea.  Sean is the author of this blog and English-speaking Korean lawyers contribute to the blog.  Please find below a few of the most recent matters we have worked on. Leading rating services have rated IPG attorneys as leading lawyers working in Korea and throughout Asia. To learn more, please drop us an email or give us a call. IPG’s Korean Labor & Employment Law Team Experience Drafted Korean employment agreements, employee handbooks, employment rules and formed a pension and corporate compliance system for a NASDAQ-listed company with a subsidiary in Korea. Oversaw a leading manufacturer’s reduction of 5% of the headcount in China and Korea.  Prevailed in cases of foreign employees of Korean companies who were wrongfully dismissed from these Korean conglomerates. 

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Jurisdiction and Choice of Law Issues in Agency Agreements

In drafting and negotiating a Korean commercial agency agreement between a principal located in one country and an agent located in another country, proper consideration needs to be given to the choice of law regarding the governing law and jurisdiction of such an agreement. Jurisdiction determines which country’s courts will hear any proceedings that may be brought in relation to the agreement, whilst governing law is the law that shall be applied by the courts hearing any such proceedings that may arise under the agreement. Ideally, the parties to the agreement should expressly agree as to choice of jurisdiction and governing law. A governing law clause will set out the parties’ choice of the law that will apply to the parties’ agreement, and a jurisdiction clause will set out the parties’ choice as to jurisdiction. These aforementioned clauses are – in general – considered by any courts (for the exemptions

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Korea’s New Electronic Passport Without Resident Registration Number in 2020

The Amendment to the Korean Passport Act introduces a new Korean Electronic Passport. The passport excludes the Resident Registration Number and establishes a new system in order to ease administrative work of the government. This Amendment shall become effective in 2020. The Passport Act of the Republic of Korea According to Art. 7 Passport Act every Korean passport shall include: Type of passport; Issuing state; Passport number; Date of issuance and expiration; Issuing authority; Name of the passport-holder; Nationality of the passport-holder; Gender of the passport-holder; Date of birth of the passport-holder; Resident registration number of the passport-holder; and Photo of the passport-holder; Due, facially, to protect personal information, the Korean Foreign Affairs and Unification Committee declared the low importance of the inclusion of a Korean Resident Registration Number in Korean passports. Therefore, the Amendment excludes the number from Korean passports. Highlights of the Amendment to the Korean Passport Act

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Korea Focuses on Greater Control over Imported Food – Amendment to the Special Act on Imported Food Safety Control 2019

The Special Act on Imported Food Safety Control was recently amended and shall strengthen the on-site inspections of foreign establishments, which already export food to Korea, as well as those, which apply for registration of the importation of overseas food. The Amendment was proposed in early April 2019 and shall become effective upon promulgation. We expect substantially heightened risk for importers and an increase in the price of many imported goods. Major Provisions of the Korean Amendment to the Special Act on Imported Food Safety Control Food from facilities overseas, which is produced, manufactured, processed, treated, packaged and/or stored, before being imported to Korea, shall be subject to inspections initiated by the Ministry of Food and Drug Safety. In addition, overseas facilities, which intend to import livestock which are slaughtered, manufactured, processed, stored and/or milk is collected, shall also be required to be inspected upon request of the Ministry of

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The Amendment to the Korean Pharmaceutical Affairs Act 2019

The Korean Pharmaceutical Affairs Act (hereinafter as “Pharma-Act”) was proposed by the Chair of the Health and Welfare Committee of Korea on December 27, 2018. The Pharma Act shall adds more cumbersome regulations on the foreign qualifications of pharmacists, increases the limits of penalty surcharges and shall change the system to transfer a Korean pharmacy businesses. This Amendment shall become effective in July 2019. The major amendments are detailed below. Key Highlights of the Korean Amendment to the Pharmaceutical Affairs Act Criteria for the Qualification for the Korean Pharmacist Exam regarding Pharmacists Who Graduated from Foreign Colleges The current Art 3 Pharma-Act, as part of Section 1 – Qualifications and Licenses of Pharmacists states that a person, which wants to become a pharmacist “…shall obtain a license from the Minister of Health and Welfare.” A license shall be granted if an individual has a bachelor’s degree from a national institution

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Amendment to the Korean Foreign Investment Promotion Act 2019 – Investment Incentives in Korea

The Korean Foreign Investment Promotion Act (hereinafter as “FIPA”) is intended to support foreign investment in Korea by providing investment incentives to investors in the Korea market. The Korean National Assembly amended the FIPA this year. Key-facts about the Korean FIPA The Korean FIPA shall “…promote foreign investment in Korea by providing necessary support and benefit and to contribute to the sound development of the nation’s economy.” (FIPA Art. 1). FIPA may benefit foreign investors, including, individual investors, companies established in foreign jurisdictions, local companies owned by foreign companies and, also, international economic cooperative organizations. “Foreign investments” under FIPA Art. 2 “Where a foreigner holds stocks or shares […] of a Korean corporation (including a Korean corporation in the process of establishment; […]) or a company run by a national of the Republic of Korea, […], by any of the following methods in order to establish a continuous economic relationship

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Korea Fully Legalizes the Usage of LPG as a Fuel for Vehicular Transportation

The Amendment to the Korean Safety Control and Business of Liquefied Petroleum Gas Act (“Liquefied Petroleum Gas Act” or “Act”) was proposed by the Korean Chair of the Trade, Industry, Energy, SMEs and Startups Committee on March 13, 2019 and shall become effective upon promulgation. The aforementioned Amendment enables the use of liquefied petroleum gas (“LPG”) as a fuel for vehicular transportation in the Republic of Korea via elimination of the restrictions on the use of LPG in vehicles. The existing Safety Control and Business of Liquefied Petroleum Gas Act The existing Act’s purpose, as noted in the Act, is to “…ensure public safety by prescribing matters concerning the export and import, filling, storage, sale, and use of liquefied petroleum gas, and the safety control of gas appliances and to ensure proper supply and use of liquefied petroleum gas by rationally regulating liquefied petroleum gas business.” The Act was promulgated

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Distribution Agreements in Korea: Crawl before you Walk

Prior to going into any relationship with a distributor/agent in Korea, please read my post entitled: Finding a Korean Distributor: The Top 10 Things to Know Before Going to Bed with a Distributor in Korea. Please read that post in combination with this post, prior to engaging a distributor in Korea. We see too many Korean distribution agreements that are mere spun U.S. or European agreements.  Please have your Korean distribution agreement and all agreements you have in Korea drafted by an experienced and proactive attorney that has on-the-ground experience in Korea.  We see too many issues that could have been easily resolved by a carefully drafted agreement and a little due diligence. Issues to consider for your Korean Distribution Agreement: Will your distributor in Korea be your agent?  If the Korean distributor is an agent, generally, you will, only, be paying your agent In Korea a commission and you will be

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“Fine Dust” as Socially-Generated Natural Disaster – Amendment to the Framework Act on the Management of Disasters and Safety 2019

As a further reaction to the fine dust-issue in Korea, the Chair of Korea’s Public Administration and Security Committee proposed an Amendment to the Framework Act on the Management of Disasters and Safety (hereinafter a “Act on Management of Disasters”) on March 13, 2019. The regulation shall become effective upon promulgation. The major legal change is the “damages caused by fine dust” as a being defined as a “socially-generated natural disaster.” Framework Act on the Management of Disasters and Safety Due to rising problems fine dust causes in Korea, the Korean Government has implemented numerous regulations and safety measures to allegedly reduce the damaging influence of fine dust to the Korean society. Not long ago the Korean Special Act on Fine Dust Abatement and Management was amended, which legally defined the different types of dust and enabled officials to set certain fine dust reduction measures, such as suspension of certain

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Amendment to the Korean Protection of Military Bases and Installations Act 2019

The Amendment to the Protection of Military Bases and Installations Act of Korea was proposed by the Korean Chair of the National Defense Committee on April 4, 2019 and shall become effective in the autumn of 2019. The Amendment stipulates the extension of the scope of “protection zones” within a military base or installation in Korea and amends the process to remove the status as a “protection zone” with the return of the concerning military base or installation to the Korean government. Increasing the Scope of the Protected Zones in a Military Base or Installation in the Republic of Korea The purpose of the aforementioned Act is to “…to contribute to the national security by providing for matters necessary for the protection of military bases and installations and smooth conduct of military operations.“ To the term “military installations” under the amendment adds in Art. 2: Protection of Military Bases and

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