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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Korea Increases the List of Serious Crimes in the Act on Regulation and Punishment of Criminal Proceeds Concealment

The Chair of the Legislation and Judiciary Committee in Korea proposed an Amendment to the Korean Act on Regulation and Punishment of Criminal Proceeds Concealment (hereinafter as “Act on Punishment of Criminal Proceeds Concealment”) on April 4, 2019. Some crimes shall be added to the list of “serious crimes” stated in the aforementioned Act. Amendment to the Act on Punishment of Criminal Proceeds Concealment The list of “serious crimes” (also “specific crimes”) as defined in Art. 2 (1) Korean Act on Punishment of Criminal Proceeds Concealment shall be extended with the proposed Amendment. These newly added “serious crimes” shall be subject to a proper punishment under this Act, especially for concealing, disguising and/or exchanging criminal proceeds. In addition, the collection and/or confiscation of such illegally earned proceeds shall be able. The newly added ‘serious crimes’ under this Act shall be for instance: Confinement, human trafficking, kidnapping, abduction, etc., as well

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Tax Breaks for Korean Landlords: Real Estate Taxation Basics

Proposed by the Chairman of the Strategy and Finance Committee of the Republic of Korea on September 20, 2018, the Amendment to the Korean Restriction of Special Taxation Act came into force on January 1, 2019. The amendment has decreased the taxation burden of some landlords. The Act was amended in favor of Korean landlords who renew long-term rentals with tenants by charging a lower increase of rent by a percentage lower than a percentage set by Presidential Decree. This Act shall reduce, in general, the tax burden of these Korean landlords. Art 96-2 Restriction of Special Taxation Act of the Republic of Korea states that “…when a national of the Republic of Korea who runs a housing rental business has earned a sum from that business a total income not exceeding 75 million won in a single taxable year, and has rented a commercial building to the same tenant

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Korean Immigration Law: Challenging a Korean Immigration Deportation/Exit Order in Korea

Being convicted of a crime in Korea, may lead to deportation.  If you are issued a deportation/exit order from the Korean Immigration Service, you do have avenues to reverse this deportation order within the courts.  Korean Immigration Law is rapidly changing – please check back to The Korean Law Blog for the latest updates from Korean Immigration lawyers from IPG’s Korean Immigration Law Team. The Courts in Korea have jurisdiction to review all exit/deportation orders issued by Korean Immigration.  Korean courts will look, generally, to whether: A.  The order of Korean Immigration complies with the law; and B.  Whether Korean Immigration has abused its discretion. Under Korean law, Immigration Services of Korea has broad power in the issuing of deportation and exit orders.  Korean Immigration law imposes restrictions on actions by Korean Immigration under certain visa categories.  If Immigration in Korea complied with Korean law, a Korean Immigration’s order may,

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New Provisions regarding the Korean Act on Reporting and Using Specified Financial Transaction Information

The Amendment to the Act on Reporting and Using Specified Financial Transaction Information of Korea (hereinafter as “Amended Financial Transaction Information Act of Korea”) focuses on strengthening Korean legal provisions related to money laundering as well as implementing a “global standard” proposed by the Financial Action Task Force on Money Laundering. The Amended Financial Transaction Information Act of Korea shall enter into force on July 1, 2019. Major provisions of the Korean Act on Financial Transaction Information The purpose of the Act on Reporting and Using Specified Financial Transaction Information is to “…provide for matters concerning reporting on and use of specified financial transaction information necessary to regulate money laundering and financing of terrorism through financial transactions, such as foreign exchange transactions, thereby contributing to preventing crimes and further establishing a sound and transparent financial system.” (Art 1). The major provisions of the prior Act are: Transactions of expected illegal

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Release of an Arrested Vessel in Korea: Maritime Liens in Korea

We wrote an article about the Arrest of Vessels in Korean waters in a post last week.  The article is a useful guide for those considering arresting a ship in Korean waters.  The post may be found at: Arrest/Attachment of Vessels in Korean Waters: Maritime Liens for Creditors in Korea. This post describes how you may obtain the release of a vessel arrested in Korea waters.  The Korean Courts have put in place an efficient post-arrest procedure that, often, quickly allows the release of an arrested ship. Post-Arrest Procedures in Korea for Ships Arrested in Korean Waters In the post-arrest procedures in Korea, the burden is on the arresting party to establish that the order of arrest, initially granted, should not be vacated.   These hearings are often a tool to persuade a judge that the arresting party should post a security or the security should be increased.  In all but

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Arrest/Attachment of Ships at Korean Ports: Maritime Liens in Korea

The arrest of vessels/ships in Korea is a common tool to satisfy judgements against debtors.  Korean courts allow the ex-parte arrest of ships.  The court, normally, does not request from the Korean counsel of the creditor/claimant evidence of how long the ship will remain in Korean waters, as is, sometimes, the case in other neighboring jurisdictions. We find Korea to be a much easier destination for arresting vehicles than many other Asian nations, because of the efficiency focus of the Korean court system and the less than efficient other Asian jurisdictions.  Typically, the arrest action will take a few days to complete. The major ports in Korea that an arrest may be executed at are: Busan ,Jinhae, Incheon, Gunsan, Masan, Mokpo, Pohang, Donghae, Ulsan, Yeosu, and Jeju. ARREST OF FOREIGN VESSEL IN KOREAN WATERS There are two different ways to arrest a vessel in Korean waters. 1.  Preliminary Attachment The

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Korean Patent Law’s Trade Secret Protection: Amendment to Trade Secret Law in Korea

The amended Patent Act of Korea (“Korean Patent Act”) and the amended Unfair Competition Prevention and Trade Secret Protection Act (“Korean Trade Secret Protection Act”) of Korea shall enter into force on July 9, 2019. The most important key developments are great criminal penalties for trade secret misappropriations; damage awards up to three times of the actual damage regarding infringements of patent rights or trade secret rights; eased litigation requirements for the claimants; and revised basis for calculating royalty damages. These amendments are expected to lead to a heightened protection for intellectual property rights in Korea. The 2019 Major Key Changes in the Korean Patent Act and the Korean Trade Secret Protection Act: Increased Criminal Penalties under the Korean Trade Secret Protection Act Under the current regulations, a criminal penalty for a trade secret misappropriation is narrowly defined and considered by many legal practitioners and academics as not protective enough

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Amendment to Korea’s Occupational Safety and Health Act in 2019

The amended Occupational Safety and Health Act of Korea (hereinafter as “OSHA”) entered into force on January 15, 2019. One major aspect of the revision is that it has raised the risk of liability of representatives of institutions and companies and companies for workplace industries in Korea. The amended Korean OSHA law is expected to increase the risk to company management, increase liability of companies and increase options for employees that are perceived to have been harmed because of the actions or inaction of employers. Korean OSHA Basics Importer or Manufacturer of harmful and/or dangerous chemicals should draft a Material Safety Data Sheet and send it to the Ministry of Employment & Labor for approval. The Material Safety Sheet is publicly published – in most cases. Hazardous work shall not be contracted out by companies to third parties. However the amendment provides some notable exceptions (beyond the scope of this

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Succeeding in Business in Korea

Since 1977, I have observed the rise and fall of many foreign companies in South Korea. I have witnessed the trials and tribulations as a bank employee, a high-tech salesman, a country manager and as a business consultant of foreign and Korean companies doing business in Korea . Bluntly speaking, while some foreign ventures have had some unlucky breaks, those companies that have succeeded in the Korean market have done so for good reasons.  And those who have failed have done so, largely, because of their own inadequacies and often the lack of understanding of the needs of businesses in the Korean market. Those companies who for a period “succeed” do so by largely having some kind of a monopoly in technology, a lock on a particular resource, or an overwhelming marketing advantage that makes Korean copycats look decidedly second class.  But many initially successful companies ultimately fail by not getting adequately

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Safety Measures in Korean School Buses in Korea via the Amended Road Traffic Act of Korea

The Amendment to the Korean Road Traffic Act (hereinafter as “ Korean RTA”) is in force since March 2019 and shall generally increase the safety for children in school buses in Korea. The Amendment was a reaction to an accident that occurred with in school buses, including children, which got physically harmed or even died. An infamous incident involved a young child that left unattended in a bus and died because of, among other things, heat exhaustion. Korean RTA drastically changed, the following brief snippet is, only, the tip of the iceberg. If you are running a business that transports children, we, highly, recommend having your law firm in Korea walk you through this law. Two Highlights of the Amendment to the Korean Road Traffic Act 2019 “A driver of a school bus for children shall operate a device that verifies that the discharge of children from the bus has

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Über IPG

Unsere weltweit-erfahrenen und lokal-vernetzten englisch-sprachigen koreanischen Rechtsanwälte und Business Professionals unterscheiden sich bewusst von der Menge. Wir lieben es an den kompliziertesten und umstrittensten Rechtsfällen in Korea zu arbeiten und genießen es besonders vorausschauende und effizient gewiefte Rechtsberatung zur Verfügung zu stellen. Bewusst anders Wir unterscheiden uns bewusst von anderen koreanischen Rechtsanwaltskanzleien. Koreanische Rechtsanwaltskanzleien werden oft für ihren Mangel an Bereitwilligkeit oder der Fähigkeit, eine effiziente, proaktive und konfliktlösende Rechtsvertretung für Klienten zur Verfügung zu stellen, kritisiert. Klienten und internationale Rechtsanwaltskanzleien kommen oft zu IPG, nachdem sie diese „koreanische Realität“ erlebt haben. Unsere Firma und ihre koreanischen und internationalen Rechtsanwälte wurden von führenden rechtlichen Ratingagenturen wegen ihrer starken lokalen Vernetzung, ihres modernen Fall-Managementsystems und ihrer realen vor Ort gewonnen internationalen Rechtserfahrung gepaart mit einer intensiven Leidenschaft für Erfolg anerkannt. International bewertet Unzählige internationale rechtliche Ratingservices haben unsere Anwälte als führende Anwälte im Bereich Wirtschaftsrecht, Zivilprozess, Entertainmentrecht, Franchiserecht und Strafverteidigung anerkannt.

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