Unauthorized Use of Ideas 'Up to Triple Compensation'... Amendment and Enforcement of the BuGyeong Act

The amended Pukyung Act, which requires compensation of up to three times the amount of damages for unauthorized use of others' ideas, will take effect from the 21st. Image=Asia Economy DB

[Asia Economy (Daejeon) Reporter Jeong Il-woong] #A, a small and medium-sized enterprise, recently received a request from a large corporation to provide technical data as a condition for supply and submitted the relevant materials. However, the large corporation gave the materials submitted by Company A to another competing small and medium-sized enterprise, inducing price competition and lowering the supply price.

#Mr. B participated in a product idea contest held by a company but his idea was not adopted. The problem arose months later when the contest organizer released a similar product, leading him to suspect that his idea had been stolen.

In cases like Company A and Mr. B, where ideas are used without permission, there is now a legal path to claim up to three times the damages.

On the 21st, the Korean Intellectual Property Office (KIPO) announced that it would begin enforcing the amended "Unfair Competition Prevention and Trade Secret Protection Act" (hereinafter referred to as the UCPA) from that day.

The UCPA focuses on increasing compensation up to three times the amount of damages when ideas provided during transactions are used without authorization, causing losses to the provider of the idea.

The purpose of enforcing the UCPA is to eradicate so-called technology theft, which involves using innovative ideas without fair compensation.

In particular, KIPO has established a legal basis to publicly disclose the personal information of violators, the facts of the violation, and the contents of corrective recommendations in official gazettes if unfair competition acts such as idea theft are not corrected after a recommendation for correction.

This supplements the previous limitation where no sanctions such as fines followed if corrective recommendations for unfair competition acts were not implemented.

For example, previously, even if idea theft was recognized, only a recommendation to ban the sale of products containing the idea was made, and it was practically difficult to impose sanctions if this was not followed.

However, with the amendment of the UCPA, separate sanctions against idea thieves will be possible in similar cases, which is expected to enhance the effectiveness of corrective recommendations for unfair competition acts.

Additionally, during administrative investigations of unfair competition acts, if a party applies for dispute mediation with the Industrial Property Dispute Mediation Committee, the administrative investigation can be suspended, and if the dispute mediation is concluded, the administrative investigation can be terminated. KIPO expects this to play a role in early resolution of disputes between small business owners or small and venture companies.

KIPO has also established a legal basis through the UCPA amendment to formulate a mid- to long-term five-year basic plan and annual implementation plans for preventing unfair competition and protecting trade secrets.

Before the amendment of the UCPA, technology protection measures under related laws were limited to strengthening post-remedies such as punishment for technology leakage and compensation for damages. However, through the amendment, it will now be possible to strengthen preventive activities to prevent the outflow of national assets (national wealth outflow overseas).

To this end, KIPO plans to conduct a status survey for preventing unfair competition and protecting trade secrets starting this month and prepare a basic plan and detailed implementation plan based on the survey results.

KIPO Commissioner Kim Yong-rae said, “We expect that the amendment of the UCPA will eradicate unauthorized use of others’ ideas by exploiting superior positions.”

This content was produced with the assistance of AI translation services.