1. Reasons for Amendment
The current Act designates and manages as national core technology those technologies that may have a serious adverse effect on the country’s security or the development of the economy if leaked to another country due to its high technological and economic value or industrial growth potential in Korea or other markets.
However, although technology is being divulged in a growing number of ways, such as technology transfers from domestic entities to foreigners or mergers and acquisitions of technology-possessing institutions through domestic private equity funds, the current Act lacks grounds to regulate such matters.
Moreover, there are no legal grounds to recognize national core technologies when an institution that possesses such a technology does not seek or deliberately avoids recognition, creating gaps in the management of national core technologies and institutions that possess them.
The current Act prescribes penalties against the use of national core technologies or industrial technologies in a foreign country and divulgence for the purpose of such use, but critics point out that difficulties in proving the intent have weakened responses to technology divulgence.
This has highlighted a need to prevent recruitment services carried out for the purpose of technology divulgence by punishing cases where technology divulgence is mediated, brokered, or encouraged.
2. Major Provisions
A. Define in the law the concepts of “foreigner,” “export of national core technology,” and “foreign investment such as overseas merger and acquisition, joint venture, etc.” specified in the Decree, etc. (Article 2).
B. Prepare the legal basis that allows the Minister of Trade, Industry and Energy to notify the institution possessing industrial technology to apply for determination on whether its technology amounts to national core technology (Article 9-2 newly inserted).
C. Prescribe applicable provisions to allow the registration and management of institutions possessing national core technologies (Article 9-3 newly inserted)
D. Stipulate in the Act grounds to impose conditions when deliberating on the export of a national core technology, and clearly stipulate that exporting is prohibited until deliberation results have been delivered (Article 11 amended).
E. Prescribe that in the event of an overseas merger or acquisition of an institution possessing a national core technology, the institution and foreigner shall jointly apply for approval, and stipulate that approval may be granted after considering ripple effects on the national economy as well as national security (Article 11-2).
F. Prescribe grounds to check the fulfillment of any imposed conditions when granting approval for, or accepting a report on, the export of a national core technology or an overseas merger or acquisition (Article 11-3 newly inserted).
G. Prescribe that where an institution possessing industrial technology has failed to comply with an improvement recommendation received in relation to measures for protecting national core technologies or the protection and management of national research and development projects, the Minister of Trade, Industry and Energy may issue a corrective order (Article 13).
H. Prescribe that violations shall include any unauthorized divulgence of national core technology outside the designated location and any mediation, brokerage, or encouragement of technology divulgence (Article 14).
I. Change the criminal elements of overseas divulgence of a national core technology or industrial technology from a purposeful offense to a deliberate offense so that a person who divulges technology with the knowledge that he or she, or another person, will use it in another country (Article 36).
J. Add to the scope of persons punishable by administrative fines those who have failed to submit recognition application documents pursuant to Article 9-2 or an application for registration as an institution possessing a national core technology pursuant to Article 9-3 (Article 39).
K. Prescribe that a charge for compelling compliance may be imposed on persons who have failed to comply with a suspension, prohibition, or restoration order from the Minister of Trade, Industry and Energy regarding the overseas merger or acquisition of an institution possessing a national core technology (Article 40).
