The government will introduce a "Korean-style discovery system" to prevent technology theft from small and midsize enterprises. It also decided to make damages more realistic by recognizing the development expense that was infringed as a loss.
On the 10th, the Ministry of SMEs and Startups announced a joint plan by relevant ministries at the Ministers' Meeting on Strengthening Industrial Competitiveness titled "Measures to eradicate technology theft from small and midsize enterprises to establish a fair market order," together with the Fair Trade Commission and the Korean Intellectual Property Office.
First, it will introduce a Korean-style discovery system that can resolve the chronic "information asymmetry" that arises during responses to technology theft, ease the litigation burden on corporations that suffered harm, and lead to swift court rulings. Specifically, in damages lawsuits related to infringement of technical data, patents, and trade secrets, it will establish an expert fact-finding system under which a court-appointed expert investigates the site and the results can be admitted as evidence. It will also introduce a document preservation order system to prevent recording statements outside the courtroom and destroying unfavorable materials.
Courts will be newly empowered in damages lawsuits to order administrative agencies such as the Ministry of SMEs and Startups and the Fair Trade Commission to submit administrative investigation materials, helping determine whether technology was infringed and prompting swift trials. In addition, the scope of materials that courts can request from the ministry will be expanded from current administrative investigation materials to include digital evidence. If a party refuses, obstructs, or avoids an investigation, or fails to submit materials, fines of up to 50 million won can be imposed so that sufficient materials can be secured through administrative investigations.
Administrative investigations will also be strengthened at each stage of a case. At the intake stage, anyone, even anonymously, will be able to report suspected technology theft, not only corporations that have suffered harm. At the investigation stage, the Ministry of SMEs and Startups will introduce ex officio investigations that can begin without a separate complaint, and the Fair Trade Commission will strengthen its existing ex officio investigations by focusing on industries where technology theft occurs frequently to detect and sanction legal violations. At the action stage, the sanction level of the ministry's administrative investigations, which currently are limited to corrective recommendations, will be improved to allow corrective orders, and for serious violations, it will also pursue imposing a penalty surcharge.
Damages for technology theft will also be made more realistic. It will improve the criteria for calculating damages so that the expense invested in developing the infringed technology can be recognized as a basic loss in litigation. It will also prepare a plan to use research and development cost information from government R&D projects similar to the victim corporation's technology. If requested by the victim corporation or the court, it will calculate the range of the victim corporation's research and development expense and provide it so it can be used as evidence in damages lawsuits. It will integrate and manage, on the online platform "Technology Protection Fence" for providing technology protection information, the case law on technology infringement needed for calculating damages, information on technology development expense, and technology transaction information.
The effectiveness of preventing technology theft will also be strengthened. The Ministry of SMEs and Startups, the Ministry of Trade, Industry and Energy, the Fair Trade Commission, and the Korean Intellectual Property Office will expand support for tailored technology protection consulting and education by ministry. It will also support the establishment of an automated trade secret classification and leakage prevention system using AI, and for small and midsize enterprises that possess national core technologies, it will support the installation of security facilities. In addition, it will newly establish the "pan-ministerial response team to eradicate technology theft" and the "SME technology dispute hotline" to make reporting easier.
Minister Han Seong-suk of the Ministry of SMEs and Startups said, "The ultimate goal of the measures announced today to eradicate technology theft from small and midsize enterprises is the realization of a fair-growth economic environment based on fairness and trust," adding, "We will meticulously manage the policies through inter-ministerial cooperation so that the measures can take root effectively in the field."