The technology developed with great effort by small and medium-sized enterprises goes beyond mere asset; it is the key to the survival and growth of corporations, and furthermore, to national competitiveness. We will swiftly establish measures to eradicate the theft of technology from small and medium-sized enterprises, reflecting the voices from the field.
Minister Han Seong-suk of the Ministry of SMEs and Startups said this during a meeting held on the 1st at the Foundation for Cooperation between Large Corporations, Small and Medium-sized Enterprises, and Agriculture and Fisheries to prepare measures to eradicate the theft of technology from small and medium-sized enterprises. This meeting was co-hosted by the Ministry of SMEs and Startups, the Fair Trade Commission, and the Korean Intellectual Property Office.
In her opening remarks, Minister Han noted, "The government has been promoting institutional improvements to eradicate the theft of technology from small and medium-sized enterprises, but despite these efforts, the theft of technology from small and medium-sized enterprises has not been eradicated and has become a chronic social issue that undermines fair competition. The Ministry of SMEs and Startups has mandated non-disclosure agreements (NDAs) during transactions between corporations to eradicate technology theft and has strengthened punitive damages from the existing three times to five times."
Minister Han cited the 'difficulty of proving' caused by information asymmetry as a reason for the ongoing theft of technology. He said, "Information related to the infringement is biased toward the offending corporation, which causes the victimized corporation to spend a long time and incur expenses in the litigation process related to the theft of technology, as well as face difficulties in providing evidence of the damages and losses."
He viewed the low amount of damages awarded as a factor that exacerbates the harm caused by the theft of technology. Minister Han stated, "Even if damages are recognized, the amounts awarded are far too low, leading many victimized corporations to bankruptcy due to failure to receive just compensation." According to the Ministry of SMEs and Startups, the average claim amount sought by plaintiffs in damage lawsuits is about 800 million won, while the amounts awarded by courts are at the level of 150 million won.
He emphasized the importance of prevention, not only in responding to technology infringement after the fact. Minister Han said, "While strong penalties are important, preventing and stopping the threat of infringement is paramount," adding, "Nevertheless, only about 37% of small and medium-sized enterprises have dedicated personnel for technology protection, and their level of protection capability is only 65% compared to large corporations."
During the subsequent meeting, small and medium-sized enterprises that have experienced theft of technology shared vivid experiences and difficulties. This was followed by policy proposals from major associations and experts, focusing on the introduction of a Korean-style discovery system and opinions on the government's policy direction to eradicate the theft of technology from small and medium-sized enterprises.
The small and medium-sized enterprises attending the meeting proposed easing the burden of proof in theft lawsuits, realizing damages for compensation, and strengthening sanctions against the acts of technology theft from small and medium-sized enterprises.
Han Ki-jeong, Chairman of the Fair Trade Commission, said, "We will strengthen monitoring of technology appropriation practices that hinder small and medium-sized enterprises' innovation and undermine their competitiveness, while actively promoting multi-faceted institutional improvements to ensure that sufficient compensation is provided to small victimized enterprises with weak legal response capabilities."
Kim Wan-ki, Commissioner of the Korean Intellectual Property Office, stated, "Technologies protected by patent rights and trade secrets are crucial to the growth and survival strategies of small and medium-sized enterprises. We will enhance investigations by the technology police of the Korean Intellectual Property Office and actively pursue improvements to related systems to eradicate the theft of technology from small and medium-sized enterprises."