by Jeong Ilwoong
Published 30 Dec.2024 08:41(KST)
The Patent Act and Utility Model Act will be amended to prevent the overseas leakage of patented technologies. The amendment is scheduled to be promulgated in January next year and will be fully enforced six months after the promulgation date.
On the 30th, the Korean Intellectual Property Office (KIPO) announced that the amendment to the Patent and Utility Model Acts recently passed the plenary session of the National Assembly. The amendment includes provisions that prohibit the filing of patents overseas for technologies necessary for national defense or require patented inventions to be treated as confidential under government orders (such as secrecy orders). Violations of these orders may result in imprisonment for up to five years or fines of up to 50 million KRW.
Until now, there were no separate penalty provisions for violations of secrecy orders in Korea, revealing a limitation in enforcement.
In contrast, major countries such as the United States, China, and Japan have established regulations allowing criminal penalties for violations of secrecy orders (e.g., up to two years imprisonment or fines up to $10,000 in the U.S., three to seven years imprisonment in China, and up to two years imprisonment or fines up to 1 million yen in Japan), enabling active responses.
Considering these circumstances, the amendment introduces penalty provisions applicable to violations of secrecy orders domestically.
In particular, the amendment adds a dual punishment clause that allows imposing fines of up to 100 million KRW on corporations, representatives, and others who have management and supervisory duties along with the violators. The fine can be up to twice the amount imposed on the violator themselves.
The amendment also adds "export" as one of the types of patent exploitation, thereby restricting the export of patent-infringing products. It allows patent holders to file injunction claims against those exporting infringing products and to seek damages or hold them criminally liable. The criminal infringement provision allows for imprisonment of up to seven years or fines up to 100 million KRW for patent infringement.
Korea ranked 8th in the world for exports and 10th for imports as of last year. However, the current Patent Act includes import as a type of exploitation but does not include export. Only the Trademark Act (since 1974) and the Design Protection Act (since 2011) partially included export as a type of exploitation.
Under the Customs Act and the Act on the Investigation of Unfair Trade Practices and Relief of Industrial Damage (Unfair Trade Investigation Act), customs authorities could block the export of patent-infringing products or impose surcharges. However, the lack of provisions for active protection such as claims for damages or criminal infringement was a limitation.
In contrast, KIPO expects that once the amendment is enforced, a basis will be established to more actively protect patent holders when patent products are exported.
Jung Yeon-woo, Director of the Patent Examination Planning Bureau at KIPO, said, "Patents are an essential element in protecting innovative technologies and securing national competitiveness. The amendment will play an important role in strengthening the protection capabilities of domestic patented technologies directly related to national security and the economy."
Meanwhile, the amendment to the Patent Act also includes revisions to the patent term extension system. Until now, there was no upper limit on the extension period for pharmaceutical patent rights, nor was there a limit on the number of patents that could be extended for a single approval. As a result, some pharmaceuticals had relatively longer patent terms than major countries, delaying the launch of generics and causing issues such as reduced drug choice for the public and weakening of health insurance finances.
However, with the amendment, the extension period for pharmaceutical approvals will be capped at 14 years (new proviso added to Article 89, Paragraph 1 of the Patent Act), and the number of patents eligible for extension per approval will be limited to one (new Paragraph 7 added to Article 90 of the Patent Act).
KIPO expects this to meet international standards such as those of the U.S. and Europe, prevent excessive patent term extensions, and contribute to expanding public drug choices and reducing health insurance expenditures.
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