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  • GS Retail Faces Scrutiny Over Vendor Practices During National Audit
    GS Retail Faces Scrutiny Over Vendor Practices During National Audit GS Retail faced criticism during a national audit for allegedly involving unnecessary intermediaries in its product supply process, raising concerns about profit-sharing. Lawmakers also pointed out that the company failed to adequately disclose economic benefits, such as sales incentives, to franchise owners.During the National Assembly's audit of the Fair Trade Commission on October 12, Han Min-soo, a member of the Democratic Party, questioned Oh Jin-seok, the vice president of GS Retail, about the suspicious transactions linked to unnecessary vendor involvement.According to Han, one of GS Retail's major suppliers, Hanbyeol, began discussions with the company in October 2020, before its official incorporation, and was registered as a partner in February 2021. Over the past five years, Hanbyeol has generated approximately 17 billion won in sales from GS Retail, despite having only three employees and no recorded inventory on its financial statements.Notably, while competitors like CU purchase batteries directly from manufacturers, GS Retail's reliance on intermediaries has resulted in supply prices for GS25 being 120% higher than those of CU.Han criticized, "It appears that GS Retail is facilitating unnecessary vendor involvement, benefiting former employees and their associated companies while collecting a 'toll.' This kind of vendor interference leads to increased consumer prices, reduced profits for franchise owners, and worsened profitability for small manufacturers." He also noted that more than two weeks after the allegations were raised, there has been no update on the investigation, indicating a breakdown in internal controls.In response, Oh Jin-seok stated, "We are reviewing potential conflicts of interest in transactions with companies linked to former employees and will conduct a thorough internal assessment to identify any structural issues."Additionally, the audit raised concerns that GS Retail did not properly disclose large sales incentives received from suppliers to franchise owners. Democratic Party lawmaker Min Byeong-deok pointed out that while GS Retail reported receiving 54 million won in supplier benefits in its 2025 supermarket franchise disclosure, the actual amount was 57.2 billion won. He warned that the total incentives received from convenience store and supermarket suppliers from 2016 to 2024 reached 3.9 trillion won, yet franchise owners have never been adequately informed, raising potential violations of franchise law.In reply, Oh assured, "We will clarify the details and provide further information."* This article has been translated by AI. 2026-10-12 18:32:00
  • Busan Secures $34 Million for Local Revitalization Efforts
    Busan Secures $34 Million for Local Revitalization Efforts Busan has received an additional 3.4 billion won ($34 million) after being rated as excellent in the evaluation of the 2026 local extinction response fund's metropolitan account distribution.The secured funds will be allocated to region-specific projects, including the creation of integrated spaces, youth employment support, and the revitalization of vacant homes in areas experiencing population decline.According to the city of Busan, this additional allocation was part of a process that evaluated investment plans from 14 cities and provinces across the country, distributing a total of 50 billion won based on performance. Busan was selected for its excellent rating following a written evaluation and a Q&A session, receiving 3.4 billion won.The investment plan submitted by the city was structured around three core pillars: intergenerational activities, youth growth, and spatial integration. The detailed projects include the establishment of a shared campus, the Busan Youth First Career Connection Project, and the Vacant Home Plus Dream initiative.The largest portion of funding, 2.5 billion won, is allocated to the shared campus project. From 2026 to 2031, the city plans to renovate three unused buildings within the Busan Catholic University seminary campus in Geumjeong District, covering a total area of 7,906 square meters.The plan aims to transform the university space, which has become underutilized due to declining school-age populations, into an educational, cultural, and sports platform that can be used by all generations, from youth to seniors.Eight hundred million won will be invested in the Busan Youth First Career Connection Project, which aims to assist 980 young people from 2027 to 2031. The project will deploy 20 professional career counselors as first-career managers.Participating youth will receive 50 hours of specialized training and will be supported throughout the entire process, from job counseling to actual employment and integration into local companies, rather than just one-time work experiences.The remaining 1 billion won will be allocated to the Vacant Home Plus Dream initiative, which will run from 2026 to 2030. This project aims to revitalize long-abandoned homes, transforming them into creative exhibition spaces for cultural artists and community hubs for local residents, rather than simply demolishing them. The goal is to renovate a total of 16 properties, starting with the reconfiguration of three buildings.Busan plans to link these new initiatives with existing projects, such as promoting workations and nurturing local youth creators, to address structural changes in the region, including youth population outflow and declining school-age populations.Mayor Jeon Jae-soo emphasized, "The securing of this fund reflects the unique characteristics of Busan, including collaboration with local universities, youth settlement, and the revitalization of unused spaces. We will continue to work to improve living conditions using the local extinction response fund."* This article has been translated by AI. 2026-10-12 18:32:00
  • Ten Days After Launch, Major Crimes Investigation Agency Has Yet to Begin Any Investigations
    Ten Days After Launch, Major Crimes Investigation Agency Has Yet to Begin Any Investigations The Major Crimes Investigation Agency (MCIA), ten days after its launch, is facing significant operational disruptions due to a lack of personnel and infrastructure. Despite receiving notifications of nearly 500 cases from the police, it has not initiated a single investigation, raising concerns about delays in law enforcement.According to data submitted by the National Assembly's Administrative Safety Committee member Kim Ye-ji from the People Power Party, the police reported a total of 459 cases to the MCIA between October 2 and October 10.The Seoul Regional MCIA received the most notifications, with 205 cases, followed by Busan (99 cases), Suwon (76 cases), Daegu (38 cases), Gwangju (25 cases), and Daejeon (16 cases). However, as of October 8, the MCIA had neither requested nor received any cases from the police. Under current MCIA law, investigative agencies must immediately notify the MCIA director upon recognizing one of seven major crimes, yet no investigations have commenced.The situation is similar for cases filed directly with local MCIA offices. As of October 7, a total of 82 cases had been filed nationwide, with paperwork assigned but no progress made in actual investigations due to inadequate infrastructure.Currently, the MCIA lacks its own Criminal Justice Information System (KICS) and is temporarily using the police's system. Key functions such as case processing and access to the criminal justice portal are expected to be available only after the second phase of the system is launched in December. Consequently, staff are handling most tasks, including record-keeping and data entry, manually.The absence of an administrative system has led to significant confusion on the ground. Many investigators have not even received work computers, relying instead on the Ministry of the Interior and Safety's Onnara system for electronic approvals and emails, while using KakaoTalk or the internal government messenger 'Ontalk' for communication. There have even been instances where investigators have had to personally cover expenses for necessary supplies, such as writing instruments, due to the lack of an MCIA account for expenditures.Concerns have also been raised about the vacancies in the agency's leadership and operational staff. The MCIA has begun operations with 1,900 of its 2,874 authorized positions filled, but many key supervisory roles remain unstaffed. Of the 24 supervisory positions at the headquarters, 16 are vacant, and in the Seoul MCIA, 11 out of 25 divisions lack a head.Meanwhile, legal experts are closely watching what will become the MCIA's first investigation. The agency is reportedly reviewing whether the recent AI hacking incident that affected the financial sector falls under the category of crimes requiring investigation.Additionally, many personnel from the former joint investigation team for voice phishing at the Seoul Eastern District Prosecutor's Office and the drug investigation unit at the Suwon District Prosecutor's Office have moved to the Seoul and Suwon MCIA, raising the possibility that drug-related or voice phishing cases may be among the first to be investigated.In response to various concerns surrounding the MCIA, an agency official spoke with Aju Economy, providing insight into the current internal situation.Regarding the KICS issue, the official stated, "Reports that it will take three years to complete KICS are generally accurate. We expect it will take that long to establish our own network," adding, "We are currently using the police's system out of necessity."When asked about the lack of investigations due to staff shortages, the official countered, "I honestly don't know if we are short-staffed. I believe we can deploy enough personnel to start investigations immediately," asserting that the claim of insufficient staff is a subjective judgment.Addressing concerns about operational disruptions due to the vacancy of the MCIA director, the official stated, "I can confidently say that there are no such issues. The organization is functioning smoothly under an acting system," and added, "A personnel hearing will be held soon, and the director may be appointed shortly. Once in place, we expect a more stable system to be established."* This article has been translated by AI. 2026-10-12 18:24:00
  • Autumn Rain to Cool Down Record Late Heat in October
    Autumn Rain to Cool Down Record Late Heat in October On Tuesday, October 13, autumn rain is expected to sweep across the country, bringing an end to an unusual late summer heat wave. After the rain, cold air from the north will significantly lower temperatures.According to the Korea Meteorological Administration, rain that began late on October 12 in the Seoul metropolitan area, Chungcheong, and western South Gyeongsang Province will expand nationwide on the 13th. The rain is expected to taper off by midday, although some areas in South Gyeongsang may experience rain into the late afternoon.Forecasts indicate precipitation amounts of 10 to 50 mm in the Seoul metropolitan area, inland and mountainous regions of Gangwon, and Chungcheong; 5 to 50 mm in Gwangju and South Jeolla; and 5 to 40 mm in North Jeolla, Busan, Ulsan, South Gyeongsang, Daegu, North Gyeongsang, Ulleungdo, and Dokdo. Jeju Island is expected to receive heavy rain, with amounts exceeding 80 mm in mountainous areas (averaging 10 to 60 mm).The record-breaking high temperatures experienced in October will subside with the rain. On October 12, warm and humid southerly winds pushed temperatures to 30.1 degrees in Seoul and 31.5 degrees in Daejeon, setting new records for October across various regions.On the morning of October 13, the lowest temperatures will range from 15 to 20 degrees, which is above average, but daytime highs will return to normal levels, ranging from 20 to 26 degrees.Expected temperatures in major cities (low to high) are as follows: Seoul, Incheon, and Daejeon 17-22 degrees; Gwangju and Ulsan 18-24 degrees; Daegu 17-24 degrees; and Busan 20-24 degrees. Notably, after the pressure system moves out, temperatures are expected to plummet to between 5 and 14 degrees by the morning of Wednesday, October 14.Meanwhile, from the night of October 13, strong winds with gusts of up to 55 km/h (70 km/h in mountainous areas) are expected to affect the west coast and Gangwon, with warnings for vessels at sea as wave heights will gradually increase starting from the central West Sea.* This article has been translated by AI. 2026-10-12 18:24:00
  • Korean SPAC Market Faces Decline Amid U.S. Recovery
    Korean SPAC Market Faces Decline Amid U.S. Recovery The domestic Special Purpose Acquisition Company (SPAC) market, once a pathway for unlisted quality firms to go public, is facing a significant downturn. Many SPACs are at risk of dissolution due to their inability to find suitable merger targets after going public. Concerns are growing that SPAC listings in South Korea are nearing a crisis. This trend contrasts sharply with the U.S. SPAC market, which has shown a clear rebound after enduring a wave of regulatory challenges from the Securities and Exchange Commission (SEC). Industry experts are calling for comprehensive reforms to address the situation.According to the financial investment industry, the number of SPAC IPOs in the U.S. reached 154 as of October 10, with a total offering amount of $30.156 billion. With three months remaining in the year, this figure has already surpassed the total number of IPOs in 2022, which was 144.The U.S. SPAC market peaked in 2021 with 613 listings worth $162.5 billion. However, following the SEC's introduction of stricter regulations on inflated performance forecasts and disclosure obligations, the number of SPAC IPOs plummeted to just 31 in 2023, with a total offering amount of $3.8 billion. Nevertheless, the final implementation of the regulatory framework in July 2024 alleviated market uncertainties, leading to a rapid restructuring centered around quality sponsors and a successful rebound.In contrast, the Korean SPAC market is in a state of crisis. During the COVID-19 pandemic, the IPO market thrived, and in February 2022, the introduction of the 'SPAC merger dissolution' method allowed unlisted companies to continue operating, sparking a historic surge in SPAC listings. Previously, SPACs had to remain as legal entities, which complicated the approval of unlisted companies' operational history and corporate succession. The new process significantly streamlined these requirements, making SPACs an attractive alternative for IPOs.However, this boom was short-lived. Since last year, both new listings and merger attempts have sharply declined, and many SPACs are now struggling to find quality companies to merge with, leaving them to wait for their three-year expiration period.Market analysts point to structural factors in the domestic market as the cause of the SPAC crisis. The prolonged high-interest rates have diminished the expected returns that make SPAC mergers attractive, such as the lack of discounts applied during the offering. Additionally, the increasing approval rates for traditional IPOs have significantly reduced the demand for SPAC listings among companies.Moreover, measures taken by financial authorities and the Korea Exchange to raise the delisting market capitalization requirements have dealt a severe blow. Typically, unlisted companies seeking SPAC mergers are smaller in market capitalization, and the increased thresholds for delisting have led these smaller firms to prefer traditional listings or to delay going public altogether. As merger targets dwindle, securities firms are also losing the incentive to incur costs for new SPAC listings.To address the sluggish SPAC listing issue, the Korea Financial Investment Association has excluded SPAC IPOs from the 'mandatory holding commitment priority allocation' since April 1, reducing the burden on underwriters to attract institutional investors. Consequently, the number of SPACs that submitted initial IPO registration statements from April to September this year increased slightly to nine (with a planned offering amount of 118 billion won) compared to the same period last year. However, this is still a 55% decrease in the number of companies and a 44.7% drop in the planned offering amount compared to the same period in 2024, which was a boom year for SPACs.The unique 'underwriter-centric structure' of the domestic SPAC market has also proven to be a limitation. In global SPAC markets like the U.S., the capabilities of the CEO and sponsors to leverage their networks and identify companies are crucial to deals. In contrast, in South Korea, securities firms have been criticized for overissuing SPACs primarily for commission income and investment banking performance, while lacking the post-listing capabilities to connect with valuable unlisted companies.An investment banking industry source expressed concern, stating, "If a listed SPAC fails to find a merger target within three years, it will be delisted, returning the principal and a modest interest to investors, leading to dissolution. If this trend of failing to find merger targets continues, it will inevitably undermine the overall credibility of the SPAC market." 2026-10-12 18:20:10
  • Kim Ji-yong Denies Allegations of Abandoning Prosecution and Countercharges
    Kim Ji-yong Denies Allegations of Abandoning Prosecution and Countercharges Kim Ji-yong, the nominee for the inaugural Director of the Serious Crimes Investigation Agency, addressed allegations that he effectively abandoned prosecution against a fraud defendant during his tenure as a prosecutor. He stated that he anticipated a clear acquittal due to the lack of credibility in the complainant's testimony. He also denied claims of favoritism related to a former Prosecutor General and violations of investigation procedures.In a statement distributed to reporters on October 12, Kim explained that while serving as the head of the second trial division at the Seoul Central District Prosecutors' Office in 2016, he did not specify a sentence for businessman A, who was charged with fraud, because of inconsistencies between the complainant Kim's testimony and objective account transaction records.He continued, "I requested additional clarification from Kim, but he refused, leading to the expectation of a clear acquittal." He added that he requested the court to rule according to the law and principles, and indeed, the first trial resulted in an acquittal.Kim also clarified the circumstances under which he charged the complainant, Kim, with false accusation and perjury. He stated, "Upon analyzing a photo of cash submitted by Kim, which was claimed to be taken in 2010, it was confirmed that some of the banknotes were issued in 2014."He noted that some perjury was acknowledged during the trial, leading to a guilty verdict, and expressed disagreement with criticisms of abuse of prosecution rights.In response to claims that the investigation into Kim's false accusation began before securing account inquiry results, Kim explained, "From September 2016, I requested Kim to submit documentation regarding the source of funds and to appear, but he did not comply. We summoned A to ascertain the facts of the case and conducted witness interviews due to suspicions of perjury."He also denied allegations of using inappropriate locations during the investigation and falsely recording the participation of investigators who did not attend the suspect interrogation report.Kim stated, "Trial prosecutors conducted investigations in a designated trial division space, not in a storage area." He added that while investigators may have been absent at times due to concurrent trial support duties, he believed they participated in the investigation.Regarding allegations that his relationship with the former Prosecutor General influenced the handling of the case, Kim emphasized, "There were no indications of the former Prosecutor General's involvement in the original case. We handled the case based on the perjury evidence revealed during the trial, following standard procedures without any other considerations."Earlier, CBS No Cut News reported that Kim was accused of abusing prosecution rights while handling a fraud case stemming from the National Seal fraud case during his time as the head of the second trial division at the Seoul Central District Prosecutors' Office.The case dates back to 2010, when Kim, the wife of Min Hong-kyu, the former head of the National Seal Production Division, claimed that businessman A had given her 50 million won in exchange for a promise to pay a lawyer who was a former Prosecutor General. After not receiving the money back, Kim filed a fraud complaint against A.The prosecution charged A with fraud, but Kim's trial division, under Kim's leadership, questioned the credibility of Kim's testimony and did not specify a sentence. A was acquitted in the first trial, and the prosecution did not appeal, confirming the acquittal.During A's trial, the prosecution suspected that Kim had falsely accused A and testified falsely in court, leading to a separate investigation. In May 2017, Kim was charged with false accusation and perjury.In February 2018, the court acquitted Kim of the false accusation charge, and the same ruling was upheld in the appeals court, indicating that it was difficult to view the fact that Kim had given A 50 million won as false. Only some perjury charges were acknowledged as guilty.Controversy also arose regarding the investigation procedures. According to CBS, the court did not recognize the evidentiary value of the suspect interrogation report prepared during Kim's investigation, citing that investigators did not participate legally. Although Kim later moved to the position of head of the first inspection division at the Supreme Prosecutors' Office, there were criticisms that no related inspections were conducted.Additionally, there are allegations that Kim failed to properly handle another whistleblower case during his tenure as head of the first inspection division. According to Ajou Economy, former prosecutor Choi reported misconduct related to the Asan Cham Hospital investigation and allegations of retaliatory personnel actions in 2017, but the Supreme Prosecutors' Office closed the case the following year, citing the expiration of the disciplinary period and lack of evidence. Choi claimed that he was not even able to attend an investigation, holding Kim responsible. Kim's side stated, "We will provide further comments after reviewing the content."* This article has been translated by AI. 2026-10-12 18:20:00
  • 24 South Koreans Arrested in Nepal for Participating in Religious Program
    24 South Koreans Arrested in Nepal for Participating in Religious Program Twenty-four South Koreans were arrested in Nepal after participating in a religious program while on tourist visas.The South Korean Ministry of Foreign Affairs stated on October 12 that it is aware of the situation and has been in close communication with local authorities through the South Korean embassy in Nepal since learning of the incident. The ministry added that it is providing necessary consular assistance to its citizens.However, the ministry emphasized that it is difficult to disclose further details due to privacy concerns, as the investigation by Nepalese authorities is ongoing.Meanwhile, Nepalese online media outlet Ratopati reported that the police recently arrested the 24 South Koreans. According to the report, they entered Nepal on tourist visas and participated in a religious training program at New Covenant College, a Christian educational institution located in the Morang district of eastern Nepal. They were scheduled to stay in Nepal until that day.It is understood that the Nepalese police determined that some of the activities of the South Koreans may not comply with the conditions of their tourist visas, as foreigners entering Nepal on tourist visas are not permitted to engage in religious education or proselytizing activities. 2026-10-12 18:16:00
  • National Assemblys Audit Session Sees Intense Conflicts Between Parties
    National Assembly's Audit Session Sees Intense Conflicts Between Parties 국정감사가 2주차에 접어든 가운데 여야는 형사사법체계 개편에 따른 경찰의 수사 역량과 감사원의 정치적 중립성 등을 두고 공방을 벌였다. 더불어민주당은 한동훈 무소속 의원 딸의 '허위 스펙' 의혹과 조희대 대법원장에 대한 감사원의 미흡한 조치를 문제삼았고, 국민의힘은 경찰의 부실·편파 수사와 현 정권의 감사위원 인사를 두고 공세를 폈다. 국회는 12일 법제사법위원회, 행정안전위원회, 국토교통위원회 등 12개 상임위원회에서 국감을 실시했다. 이날 행안위가 경찰청을 상대로 진행한 국감에서 민주당은 한 의원 딸에 대한 부실 수사 의혹을 제기했다. 김영배 의원은 "한 의원의 딸에 대한 경찰 수사가 검찰 단계에서 막혀 진행되지 못했다는 사실이 드러났다"고 밝혔다. 윤건영 의원은 "법무부 장관 사건이라고 방치했던 것 아니냐. 봐주기 편파 수사"라고 비판했다. 그러면서 전면 재수사를 요구하자 김종철 경찰청장 직무대행은 "법과 원칙에 따라 절차대로 했다고 생각하지만, 새로운 사실관계가 드러난다면 재수사 가능성을 배제하지 않겠다"고 답했다. 앞서 경찰은 2022년 5월 당시 법무부 장관 후보자였던 한 의원 딸의 허위 스펙 의혹에 대한 고발장을 접수받아 2023년 12월 불송치 결정을 내렸다. 반면 국민의힘은 검찰청 폐지에 따른 경찰의 수사 역량 문제를 제기했다. 박덕흠 의원은 장윤기 사건, 제주 실종 사건 등을 거론하며 "올해 검찰청 폐지와 맞물리면서 경찰 신뢰를 실추하는 사건이 많이 일어났다"고 지적했다. 또한 김재섭 의원이 국정감사 첫날 경찰 소환조사를 받은 것에 대해 "야당에는 혹독한 수사, 여당에는 따뜻한 수사를 하고 있다"고 꼬집었다. 행안위 야당 간사인 강명구 의원은 김병기 무소속 의원의 사건이 1년 넘게 이어지는 상황을 언급하며 "민주당 인사들이 관련된 사건은 천하태평으로 진행하고 있다"며 "경찰 수사를 편파적으로 하고 있는 것 아니냐"고 주장했다. 법사위에서는 전·현 정권에서 임명된 감사위원의 정치적 중립성과 감사원의 대법원 감사 결과가 도마에 올랐다. 박지원 민주당 의원은 윤석열 정부에서 임명된 김영신 감사위원을 향해 "'타이거파'(유병호 감사위원 중심 파벌) 부두목으로서 지금까지 감사위원으로 재직하는 것이 부끄럽지 않으냐"고 질타했다. 같은 당 김동아 의원도 "이렇게 문제가 되는데 사퇴하실 생각 없느냐"고 압박했다. 조 대법원장의 대법관 격려금 지급 논란과 관련해서도 김한규 의원은 "대법원장의 격려금 지급 방식이 적절하지 않았던 것이 맞지 않나. 왜 주의 정도만 주고 끝났느냐"고 따져 물었다. 반면 윤상현 국민의힘 의원은 이재명 정부에서 임명된 임선숙·이진국 감사위원의 경력을 문제 삼으며 "중립성과 독립성을 해치는 인사 조치다. 국민의 감사원이 아니라 당나라 감사원"이라고 질타했다. * This article has been translated by AI. 2026-10-12 18:12:00
  • Homeplus CEO Jo Joo-yeon: Sales Growth Severely Limited
    Homeplus CEO Jo Joo-yeon: Sales Growth Severely Limited Jo Joo-yeon, CEO of Homeplus, stated that the company is currently in a situation where only advance payments and cash transactions are possible, making sales growth extremely limited. He emphasized that for the company to normalize operations, mergers and acquisitions (M&A) must proceed as planned.Jo made these remarks on October 12 during a National Assembly audit session, responding to a question from Democratic Party lawmaker Min Byung-deok regarding the implementation of voluntary retirement, which was not agreed upon when the company received 200 billion won in emergency operating funds (DIP).He noted, "The expectation with the 200 billion won DIP was to normalize operations," adding, "We aimed to increase inventory and sales through credit transactions, but that is currently not possible."Jo expressed his deep regret, stating, "Ultimately, I believe that the current situation can be resolved well only if M&A proceeds as planned."When asked about alternatives if M&A and store sales do not go as planned, he replied, "We will do our best."* This article has been translated by AI. 2026-10-12 18:12:00
  • Concerns Rise Over K-Discovery Systems Potential Abuse by Patent Trolls
    Concerns Rise Over K-Discovery System's Potential Abuse by Patent Trolls As South Korea prepares to implement its K-Discovery system, designed to assist patent infringement victims in gathering evidence, concerns are mounting over its potential misuse by foreign companies targeting domestic firms. Local companies, already beleaguered by indiscriminate patent lawsuits abroad, may risk exposing critical trade secrets while attempting to prove their innocence.According to a report from the office of Rep. Choi Soo-jin of the People Power Party, South Korean tech giants like Samsung Electronics and SK Hynix have faced a total of 558 patent lawsuits from overseas in the past five years. Of these, 453 cases, or 81.2%, were directed at large corporations. Notably, in 2024, 80.4% of the 97 lawsuits filed against South Korean companies in the U.S. were initiated by non-practicing entities (NPEs), often referred to as patent trolls.As domestic firms find themselves increasingly targeted by foreign NPEs in the global market, the introduction of the K-Discovery system could further constrict their operational space. This is because companies will be required to submit sensitive internal documents, including proprietary process technologies, cost structures, and customer information, to defend against infringement claims.In jurisdictions like the U.S., where discovery procedures are already well-established, negative consequences have emerged. Recent patent lawsuits against Samsung revealed that the Chinese company Purple Vine IP funded these legal actions. A U.S. court acknowledged that despite a confidentiality order, the opposing party improperly obtained and misused confidential information, leading to the dismissal of the plaintiff's claims.There are also concerns that the costs associated with patent litigation in South Korea could skyrocket. The discovery process may involve collecting millions of documents, conducting digital forensics, and engaging specialized legal teams, potentially increasing litigation expenses by several times or even tens of times compared to current levels.This situation deepens the anxiety of domestic small and medium-sized enterprises (SMEs) in the materials, parts, and equipment sector, which typically have limited financial resources and patent portfolios. A representative from a domestic semiconductor equipment company expressed, "If advanced companies from Japan or the U.S. leverage this system to file lawsuits, our relatively weaker patent portfolios will leave us defenseless and likely to lose."There is also a risk that SMEs could be exploited by foreign NPEs, which might fund lawsuits targeting large corporations using the SMEs' patents or names. If foreign NPEs initiate discovery requests through domestic SMEs, it could lead to the exposure of critical technologies and supply chain information, jeopardizing the entire domestic industrial ecosystem.A survey by the Korea Intellectual Property Association (KINPA) revealed that 68% of responding companies opposed the introduction of K-Discovery. Among large corporations, 71% expressed opposition, while 63% of SMEs and mid-sized companies did the same. Notably, in the electronics and information communication sectors, where the risk of technology leakage is high, 92% of respondents were against the system.Concerns about fairness have also been raised. Foreign companies or NPEs often have key documents located overseas, making it difficult for domestic firms to secure evidence even if they file counterclaims. In contrast, advanced technology companies like Samsung Electronics and SK Hynix, which have their headquarters and R&D infrastructure in South Korea, face the risk of exposing core technology and trade secrets through domestic court discovery procedures.A KINPA official stated, "Unlike major countries like the U.S., South Korea lacks adequate legal protections for attorney-client privilege (ACP). If discovery is implemented, there is a significant risk that companies' core trade secrets will be exposed. If foreign NPEs use key materials obtained through domestic discovery in overseas lawsuits, it could lead to severe repercussions for the entire domestic technology sector."* This article has been translated by AI. 2026-10-12 18:08:20