The Supreme Court (Image courtesy of Yonhap)
SEOUL, Sept. 8 (Korea Bizwire) — In a landmark ruling, South Korea’s Supreme Court has upheld the authority of domestic courts to punish foreign corporations under so-called “dual liability” provisions, affirming that overseas companies can face criminal penalties if their employees commit trade secret violations within Korea.
The decision came in a case involving Everlight, a Taiwanese LED manufacturer, which was fined 60 million won (about $44,000) for violating the Industrial Technology Protection Act and the Unfair Competition Prevention Act.
The court last month finalized a lower court ruling, rejecting Everlight’s argument that Korean jurisdiction could not extend to its actions abroad.
The case stemmed from three former employees of Seoul Semiconductor, a leading Korean LED maker, who joined Everlight after leaving the company. Prosecutors said the men accessed and photographed Seoul Semiconductor’s proprietary technology before passing the information to their new employer.
Everlight was indicted under provisions that hold corporations liable alongside individual wrongdoers.
In its opinion, the Supreme Court stressed that the employees’ acts of viewing, copying and leaking trade secrets occurred within South Korea, even if the subsequent use took place overseas.
Because their conduct was integral to Everlight’s violation, the company itself was deemed to have committed the offense on Korean soil.
The ruling marks the first time the Supreme Court has explicitly affirmed that dual liability statutes can extend South Korea’s criminal jurisdiction to foreign corporations. Legal experts say the decision sets an important precedent for protecting domestic industrial technologies from misappropriation by overseas competitors.
The three former employees were separately convicted at the Suwon District Court, receiving suspended prison sentences and partial acquittals.
M. H. Lee (mhlee@koreabizwire.com)
