In many Korean companies, internal data sharing between departments is mistakenly viewed as a simple operational matter rather than a regulated activity that may lead to criminal sanctions, fines, and reputational damage. Intra-company data movement in Korea is generally not classified as a third-party disclosure; it is nevertheless subject to strict statutory principles, including purpose limitation, data minimization, accountability, and mandatory safeguards. From a regulatory perspective, the Personal Information Protection Commission (PIPC) has increasingly focused not only on external breaches but also on governance failures involving internal
Continue readingCategory: Korean Business Law
Can you Revise Employment Rules in Korea without the Agreement of Employees?
The Guidebook on Wage System Reform, published by the Korean Ministry of Employment & Labor, has sparked more interest, in the private sector, than the revamping of Korea’s wage system based on seniority. This post was reposted after a first posting in 2017, because of a newfound focus on wage system reform. The major issue, in this regard, is whether the Rules of Employment of a company may be amended, without violating the Korean Labor Standards Act of Korea (“LSA”), when “wage system reform” is not consented
Continue readingAre Foreign Patents Subject to Taxation in Korea?
Yes. The Korean Supreme Court held that a foreign patent not registered in Korea is subject to taxation if used in a domestic manufacturing process in Korea. The Supreme Court of Korea overturned the lower court’s holding in a lawsuit filed by a U.S. company against a Korean tax office and remanded the case to the Suwon High Court. The case sheds light on the need for carefully drafted agreements with a No Tax Deduction Clause that mandates that all local taxes are the sole responsibility of
Continue readingKorean Litigation Disclosure Requirements under the Korean Capital Markets Act
In a precedent-setting decision, the Supreme Court of Korea clarified the scope of disclosure obligations under the Korean Capital Markets Act, holding that the requirement to disclose “lawsuits that will have a significant impact on securities” is limited to lawsuits directly concerning securities themselves, and does not extend to all lawsuits merely because they may affect a company’s stock price. On December 4, 2025, the Korean Supreme Court’s Second Civil Division overturned part of the lower court’s judgment in a shareholder damages action against the CEO and
Continue readingKorean “Temporary Worker” Right to Employment Security under the Korean Labor Standards Act
A Korean court ruled that even if a worker is 55 years of age or older and hired as a temporary worker, the right to contract renewal is “continuously recognized unless there are special circumstances.” The Seoul Administrative Court ruled in favor of an employee on October 31, 2025, in a lawsuit filed by the Employee against the Central Labor Relations Commission of Korea, holding that non-renewal of the contract period constituted an unfair dismissal under the Korean Labor Standards Act. Facts1. Employee worked as a conductor
Continue readingKorean Criminal Liability Risks for Foreign Executives & Directors in Korea: Korean Exposure, Enforcement Trends, and How to Reduce Risk
Foreign executives operating in Korea are often surprised to learn how quickly routine corporate decisions can escalate into personal criminal liability and Korean immigration issues. Unlike many Western jurisdictions, the Korean legal system frequently treats civil matters as criminal, to the angst of foreign directors in Korea. As a result, foreign directors and executives in Korea frequently find themselves subject to police investigations, prosecutor questioning, travel restrictions, or even indictments. This article outlines the most common sources of criminal exposure for foreign executives and directors in Korea,
Continue readingIPG Legal Expert Opinions on Korean Law for Foreign Courts and Law Firms
As complex cross-border litigation, arbitration, and international transactions continue to increase in Korea, foreign courts and overseas counsel are frequently required to apply or assess Korean law and the Korean legal system. In such cases, accurate and nuanced interpretation of Korean statutes, judicial precedent, and regulatory practice is essential. IPG Legal regularly works with foreign lawyers and courts to provide expert opinions on matters governed by Korean law. We often appear in court and provide legal opinions worldwide. The Role of Korean Law Expert Opinions in Cross-Border
Continue readingBest Practices for Disciplining/Terminating Employees in Korea under the Korean Labor Standards Act
Employee discipline is one of the most frequent sources of labor disputes in Korea. Even where misconduct or underperformance appears clear, employers in Korea often lose cases before the Labor Relations Commission and the Korean courts due to procedural defects, insufficient documentation, lack of proactivity, and disproportionate sanctions. Korean labor law places strict limits on an employer’s disciplinary authority, and compliance requires more than simply identifying employee fault. For the basics of terminating an employee in Korea, please see: Termination of an Employee in Korea. For an
Continue readingPunitive Damages Under Korea’s Personal Information Protection Act: The Coupang Data Breach Incident
The recent Coupang personal information leak incident has renewed discussion in Korea on the scope and effectiveness of punitive damages under Korea’s Personal Information Protection Act (PIPA) and also the extension of punitive damages beyond this act. Although the statute permits limited, capped punitive damages in certain circumstances, Korean courts have been conservative in applying these provisions, and several structural issues continue to limit their practical effect. Lawyers in Korea are increasingly criticizing the legal system for providing inadequate damages to the injured. We shall update the
Continue readingWhy Using an Uncontrolled & Monitored Korean Local Director/Representative Director Is Dangerous for Foreign Investors in Korea
Foreign investors entering Korea are often told they “need a local director,” “because that’s how things are done here. On paper, this looks harmless. In reality, appointing a representative director, sole director, or director you do not genuinely supervise or control can be legally and commercially dangerous. “Local Director” Has Full Duties and Liabilities In Korea, the law makes no distinction between a “nominee” director and any other director. If you are on the board, you owe the full suite of fiduciary and statutory duties, regardless of
Continue reading
You must be logged in to post a comment.