It is reported that Mr. Matthew Deakin, the president of the HSBC Korea, said on last Wednesday that HSBC Holdings Plc had no plan to acquire a local Korean bank for now.  Last year, HSBC walked away from the deal with the Lone Star, a U.S. private equity fund, which provided HSBC the right to buy 51 percent stake of Korea Exchange Bank due to the global financial crisis and continued legal disputes surrounding the 2003 purchase of the bank by Lone Star Funds. (Here is a related previous post)

Things have changed.  The Seoul Central District Court in last November ruled the purchase legal, and as the financial markets are now stabilizing.  But Mr. Deakin, at the press conference which took place for the purpose of introducing the bank’s new Emerging Markets Index, said “right now, we have no interest in any acquisition of Korean banks”.

Here is a related news article.

We’ve been asked about a criminal charge against an adultery under Korean criminal law quite often.  Foreign employees in Korean should be cautious that such an adultery is a crime under Korean law.  Here is a real example of such a case where a foreign officer committed a adultery and the company(employer)’s legal concern made it ask some legal consultations to our law firm regarding the adultery law and criminal law process in Korea.

Q) Mr. XX, who is a head director of our company, committed an adultery and was charged by the Korean prosecutor.  He has confessed his guilty and the prosecutor demanded one year’s imprisonment for his crime to the court.  If the court finalize that Mr. XX is guilty, is that means that Mr. XX will be imprisonment for one year or lesser?

A) Finding guilty does not always mean Mr. XX will be imprisoned.  The Court may SUSPEND the imprisonment for certain years even though Mr. XX is guilty.  The Korean Criminal Act provides that a married person who commits adultery shall be punished by imprisonment for not more than two years.  However, the Act also provides the execution of the sentence for an adultery can be suspended for a period of not less than one year but not more than five years.  Moreover, in recent adultery cases, the Korean Court tends to hand down such a suspended imprisonment sentence more frequently than non-suspended sentence as long as the accused has never committed a crime before and he or she confesses and reflects on his crime sincerely.

Q) What would be the negative publicity to the Company?

A) I’m sorry this is not what I, as a lawyer, can answer properly.

Q) Were there any past cases convicted guilty and imprisoned?  Can you quote me a few cases?

A) Yes, so many cases.  However, as I mentioned above, recently there are even more cases of suspended imprisonment.

I hope this to be of assistance to your business.  If you have more questions related to this issue or anything on your business in Korea, please do not hesitate contact me.

© 2009 Mr. Wonil Chung, a Korean Lawyer/Chung & Partners, a Korean Law Firm.  All rights reserved.  Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.

Recently, Mr. Wonil Chung, a partner at Chung & Partners, has successfully represented NHS, Inc., an internationally-renowned U.S. company which sells skateboards, apparels under various trademarked brand worldwide, in policing their trademark in South Korea.  NHS, Inc. and its Korean distributor had found that counterfeits of SantaCruz, one of the NHS, Inc.’s premium brand, had been made and sold in numerous online shopping mall sites in Korea.  They requested Mr. Wonil Chung to stop them from selling the counterfeits.  Mr. Wonil Chung sent cease and desists letters to the online shopping sites which sold the counterfeits, notifying their trademark infringement and breach of relevant IP laws in Korea.  About a half month later, all the online shopping sites gave up selling the counterfeits  as ordered by the letters.

Policing your intellectual property in Korea is very important in your business.  The process is quite similar to the U.S. legal system, that is hiring a competent IP lawyer in Korea and sending a cease and desist letter to the offender.  In many cases the offenders stop selling the counterfeit after receiving the letter.  If they refuse to stop, then filing a lawsuit and filing a report to the investigating authority shall be the next step.

If you have more questions regarding your IP issues in Korea, please visit our legal consultation page.

© 2009 Mr. Wonil Chung, a Korean Lawyer/Chung & Partners, a Korean Law Firm.  All rights reserved.  Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.

The legal concept of a right of publicity is relatively a new one in the Korean legal system.  About 25 years ago, affected by the U.S. entertainment law, the Korean legal society began to theorize the right of publicity, and finally the lower courts of Korea approved the right of publicity right as an exclusive property right independent from the traditional right of privacy, although there is no ruling from the Supreme Court and no express provisions therefor are yet legally established.

According to the lower court rulings, the right of publicity is defined as a property right to use the name, portrait or any other identity of a person for commercial purpose and to limit their use.  The court have ruled that the right of publicity can be transferred and inherited.  Not only a living person but also a dead person have the right of publicity, which is protected during 50 years from the date of death.

In Korea, there has been many cases where celebrities and sports stars claim their right of publicity against various types of unauthorised commercial use of their identity.  For example, in 2006, in a case where a Korean game company used pro baseball player’s name and personal record in their mobile baseball game, the Seoul Central District Court held that pro baseball players have the rights of publicity on their names and personal game records so the game company which had used the player’s name and personal record without player’s permission had infringed the player’s right of publicity.  Then the court ordered the game company to pay the monetary compensation to the players.

Regarding the foreigner’s right of publicity in Korea, there has not been so many cases.  Recently Emelianeko Fedor, an internationally renowned MMA sports star, has filed a right of publicity infringement lawsuit to the Seoul Central Distrct Court alleging a Korean Honey maker’s organization had used his identity in their advertisement without his permission.  The Seoul Central District Court, however, dismissed the case holding the sports star had agreed to appear on that commercial.  As the right of publicity is a right granted to a natural person, not only to the Korean national, it is translated foreign celebrity and sports star can claim a right of publicity in Korean courts.

If you have more questions on the right of publicity or any other Korean entertainment law, please visit our legal consultation page above.

© 2009 Wonil Chung, a Korean entertainment lawyer / Chung & Partners, a Korean Law Firm.  All rights reserved.  Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.

A few days ago, Seoul Central Court ruled in favor of Starbucks Korea in a copyright lawsuit filed by the Korea Music Copyright Association alleging the Starbucks Korea should pay royalties in playing copyrighted music in its outlets.  I wrote some posts regarding this issue here and here.  The legal issue was whether playing copyrighted music substitutes a mail business of Starbucks Korea.  That is because current Korean Copyright Act does not have a explicit clause on whether cafes such as Starbucks Korea is free to play copyrighted music(check this post on relevant clauses).  The court ruled in favor of Starbucks Korea saying “playing a copyright music is not a main business of Starbucks Korea.  The fact that playing copyrighted music has some good effects on its product selling is not sufficient to prove playing music is a main business of Starbucks Korea”.

© 2009 Wonil Chung, a Korean entertainment lawyer / Chung & Partners, a Korean Business Law Firm.  All rights reserved.  Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.

We’ve been asked about this issue from U.S. lawyers or U.S. law school students quite often.  As reported earlier this month, the Foreign Legal Consultant Act was approved by the National Assembly.  The Act allows law firms from the United States and countries which have free trade agreements with Korea to set up local branches to provide legal consulting services.

However, in order to qualify as local consultants, foreign firms will not be allowed to hire locally qualified lawyers. Foreign lawyers cannot be self-employed consultants, practise local law or represent clients in court. Lawyers will need to have at least three years’ overseas work experience. Those with two years’ local experience will have to work overseas for a year and, after qualifying, all lawyers will be required to commit to living in Korea for at least 180 days a year.

Please note that the Act is not likely to cause an immediate changes on Korean legal market, as the status of FTAs signed with various countries are still pending.

Here is a related article.

South Korean popstar RAIN (Chung, Ji-hoon) and his ex-agency JYP Entertainment had lost their lawsuit in Hawaiian District Court brought by a local promoter, Click Entertainment, alleging Rain’s last minute cancellation of Honolulu concert in 2007 cost them $1.5 million and caused damage to the company’s reputation.

A couple of days ago, the court found in Click’s favour, ruling that Rain and JYP were guilty of both breach of contract and fraud.  Nearly $5 million of the damages payment are punitive, with Rain himself and JYP ordered to pay half each.

It is reported that Rain has testified he didn’t know why the concert had been cancelled and the cancellation was out of his control.

I think many people, especially outside of Korea, wonder how the singer, the performer himself, couldn’t know the reason of the cancellation and how he could say it was “out of his control”.  In this regard, I think people should know more about Korean music business to understand Rain’s comment.

In Korea, almost every singers and bands are under exclusive contracts with certain entertainment entrepreneurs, called “Ghi-Hoek-Sa”, which is the mixture of agencies and management companies, yes, they’re doing both of jobs in Korea.  The problem is the contract between the singers and the entrepreneur is being criticized as very unfavorable to the singers.  For example, the term of the contract is very long, sometimes 10 to 20 years.  If the singer wants to move to other entrepreneurs, the contract requires the singer to pay huge amount of money as a penalty.  Moreover most of singer’s activities including sound recording and concert performance is under control of the entrepreneur.  That is why many people in Korea call the contract as a slavery contract.

Some people, however, object to that kind of argument.  Instead, they argue the entrepreneurs has poured enormous investment to the singer and certain clauses in the contract such as long term period and penalty clauses should be understood as the means to secure their money back.

Serious controvery is still going on in Korea regarding which side of arguments is right, although the court has been ceaselessly ruled in favor of the singers and declared the invalidity of the contract.

Also, in Korean music business, it is quite usual for the singer and the entrepreneur to sell their right to the performing in concert to other company.  And the company sells the right once again to another company.  It can be repeated again and again.  By reason of this, the singer is having difficulty in controlling the concert performance even though he is the main performer.  Some companies even sell the right at a cheap price to unverified and incompetent companies.  That’s why so many disputes between singers and local promoters has been provoked in Korea.

Thankfully many foreign people are showing their enthuism for Korean entertainemt figures, calling it “Hanryu”.  However, unfortunately, it seems there are still uncleared and unstable legal issues, as we’ve seen above, which hold good Korean entertainment contents from devloping into a legally secured entertainment business in Korea.

© 2009 Wonil Chung, a Korean entertainment lawyer / Chung & Partners, a Korean Business Law Firm.  All rights reserved. Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.

Recently there can be seen so many lawsuits are being filed against domestic banks with regard to the bank’s irresponsible fund sale.  The Korean fund buyers are alleging the losses in the funds which are still on-going were caused by the fund-sellers’ not informing sufficient information on the risk and possibilities of losses when they put the money to the funds.

As a matter of law, Korean court has ruled that the banks are obliged to inform the customer of the structure of the investment such as fund or option transaction and the risk of possible losses sufficiently when they solicit the customers for investments.  If they neglect that obligation, it constitutes a breach of contract and the bank should pay for the customer’s damages.  It is, however, very rare the court orders the bank to pay the entire of damages.  Instead, the bank is usually ordered to pay certain portion of the damages only, considering the customers carelessness in making the investment judgment.

The Capital Market Consolidation Act, which took effect in February, slapped new regulations on fund sellers, requiring them not to market risky products to investors who register as risk-averse on a mandatory questionnaire.  The government are hoping the newly enacted law reduces the irresponsible sale practices.

Here is a related news article.

© 2009 Wonil Chung, a Korean financing lawyer / Chung & Partners, a Korean Business Law Firm.  All rights reserved. Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.

Recently we got a question regarding the s0-called “waiting-period” of remarriage under Korean family law.  There is no such a thing like “waiting-period” which prohibits a divorced person to remarry within certain period.  Actually there had been a clause of waiting period in Korean Civil Code, but the clause was abolished in 2005.  So if you’re divorced by the Korean family, then you can remarry at any time you want with no legal hindrances.

If you have more questions about divorce, marriage and any other Korean law related issues, please visit our legal consultation page.

© 2009 Wonil Chung, a Korean family lawyer. All rights reserved. Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.

Recently I got an email question from a foreign teacher in certain Korean private university.  He’s wondering why the university is insisting on retirement pension plan instead of severance payment.

There is an act called Pension for Private Teachers and Staff Act(PPTSA) in Korea, which regulates severance payment issues in private school.  As a matter of law, PPTSA is applied prior to the GWRBA(Guarantee of Workers’ Retirement Benefits Act) and it allows the private schools to set a retirement pension plan for its employees.

With respect to the relationship between the employment contract and the pension plan under PPTSA, Private Universities usually, pursuant to the PPTSA, put the retirement pension clauses, instead of severance payment, in the Rules of Employment(RE) of its own.  As a matter of law, the RE is applied to all the workers in a workplace.  That means, if there exists a RE which includes retirement pension scheme when you’re entering into an employment agreement with the private university, the both parties are bound to the RE, even though you’re not a member of labor union or you didn’t agree with the RE, i. e. the retirement pension clauses (not a severance payment) in the RE shall be applied to you.

But don’t worry, the PPTSA does also guarantee the minimum retirement pension, which is one month’s salary for each year of employment.  Per the employee’s request, the private school and the Korea Teachers Pension Foundation (the official administer of the pension under PPTSA) should provide the breakdown of the retirement pension to him or her.

If you have more questions regarding this issue, please send an email to Mr. Wonil Chung, a Korean licensed lawyer at chungwi@nate.com.

© 2009 Wonil Chung, a Korean Labor Lawyer/Chung & Partners, a Korean Labor Law Firm.  All rights reserved. Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.