This could potentially discourage domestic retailers from investing in data infrastructure and ultimately result in lower quality services for Korean consumers and a loss of national competitiveness. (Image courtesy of Pixabay/CCL)
SEOUL, July 31 (Korea Bizwire) – A new data-sharing initiative in South Korea has sparked concerns about potential risks to consumer privacy and the competitiveness of domestic businesses.
Experts warn that the MyData system, set to be implemented across all sectors by March of next year, could inadvertently lead to the cheap sale of Korean consumer data to Chinese e-commerce giants.
At a seminar hosted by the Korea Distribution Association, professor Jung Yeon-sung, Dean of Dankook University’s Graduate School of Business, highlighted the potential pitfalls of the MyData system in the retail sector.
The initiative, already active in finance and public services, allows individuals to request that their personal information be transferred from one company or institution to another of their choosing.
Jung pointed out that major Chinese online retailers like Alibaba Express and Temu have seen significant growth in the Korean market, with monthly active users reaching 8.3 million and 7.97 million respectively.
He expressed concern that the MyData system could require domestic retailers to disclose not only customer purchase histories but also membership details, payment information, shipping data, and loyalty points.
“This information is not just personal data of consumers, but also proprietary business assets that domestic retailers have invested heavily in managing,” Jung emphasized.
He contrasted South Korea’s approach with international trends, noting that China and Canada have taken steps to recognize data as private property and measure its value as a corporate asset.
The professor warned that the MyData system could lead to Korean customer information being provided to foreign companies or data brokers at little to no cost.
In April, the watchdog requested AliExpress, Temu and about eight other Chinese internet firms to faithfully comply with the South Korean law on personal data protection. (Image courtesy of Yonhap)
This could potentially discourage domestic retailers from investing in data infrastructure and ultimately result in lower quality services for Korean consumers and a loss of national competitiveness.
Another significant concern raised was the potential exposure of sensitive information. Jung cautioned that details about purchases of adult products, pregnancy-related items, or underwear preferences could be transmitted in real-time to numerous data recipients both domestically and internationally.
Kim Hyun-kyoung, President of the Personal Information Protection Law Association and professor at Seoul National University of Science and Technology, echoed these concerns.
She argued that the MyData system would inevitably restrict the rights of businesses and institutions that process personal information, potentially infringing on their freedom of business operations and property rights related to databases.
Both experts called for a careful reconsideration of the MyData initiative in the retail sector, emphasizing that no other country has implemented such a system for retail.
They stressed the need to balance the protection of domestic businesses’ competitiveness, the safeguarding of small and medium-sized suppliers’ business assets, and the privacy of Korean consumers.
Ashley Song (ashley@koreabizwire.com)
