The revised versions of South Korea’s Patent Act and Act on Prevention of Unfair Competition and Protection of Trade Secrets were enacted on February 20, 2024, and will become effective starting from August 21, 2024. The key highlights of these amendments include:
Increase in Punitive Damages:
The amendments introduce a mechanism whereby punitive damages can be awarded up to five times the amount of actual damages incurred in cases of willful infringement of patent rights, willful misappropriation of trade secrets, or acts of unfair competition such as deliberate theft of ideas during business negotiations and bidding processes. This represents an increase from the previous limit of three times the actual damages.
Strengthening of Criminal Sanctions:
Legal entities found guilty of unfair competition or trade secret infringement may now face fines up to three times the maximum fine applicable to individuals. Additionally, the statute of limitations for criminal prosecution of legal entities has been extended from five years to ten years. Previously, legal entities were subject to fines on par with those imposed on individuals for infringements committed by their representatives or employees.
Furthermore, new provisions enable the confiscation of products infringing trade secrets or involved in unfair competition practices. This allows for the swift and efficient seizure of infringing products and production equipment during criminal proceedings, without the need for separate civil litigation.
The amendments also criminalize the unauthorized destruction, loss, or alteration of others' trade secrets with the intent to gain an unfair advantage or inflict harm on the trade secret holder. Individuals found guilty of such acts may face imprisonment of up to ten years or fines of up to KRW 500 million.
Introduction of the Correction Order as a Legal Enforcement Tool:
The Korean Intellectual Property Office (KIPO) is now authorized to issue "correction orders" in cases where unfair competition practices are identified. These correction orders carry legal enforcement powers, and KIPO can impose administrative fines of approximately USD 15,000 on parties that fail to comply with the order without justification. Other government agencies may also request KIPO to issue correction orders if their recommendations are not adhered to. Moreover, the amendment grants parties involved in administrative investigations related to unfair competition the right to request access to and copies of investigation records.
Information sources：
1. http://ipr.mofcom.gov.cn/article/gjxw/lfdt/yz/zlyz/202403/1984741.html
2. https://www.ip.kimchang.com/cn/insights/detail.kc?sch_section=4&idx=29140
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