E-Commerce Laws of South Korea

Electronic Commerce, more commonly known as E-Commerce, is based on the concept of buying and selling products and/or services over the Internet business market. One country that has gained access into the online business world and is known as China’s third largest trading country is South Korea. [2] Also known as the world’s most “wired” country, South Korea has established a unique advantage in using online technology. From launching the world’s first third-generation wireless platform to introducing homebred wireless broadband Internet technologies, South Korea has stunned many with their fast approach into information technologies online infrastructure in a relatively short period of time. [1]

When pursuing an online business opportunity in a foreign country, it is important for business men and women to familiarize themselves with the basic e-commerce laws and regulations. Many businesses in South Korea who have entered into the Internet market have two basic e-commerce laws: 1) the Basic Act on Electronic Transactions and 2) the Electronic Signature Act. [1] These laws, which were both implemented in 1999, broadly define how e-commerce is regulated and online market transactions should be handled legally in South Korea.

Under the authority of the Ministry of Commerce, Industry and Energy, a set of guidelines were recommended for South Korea’s e-commerce regulations, including consumer privacy protection. As procedures turned into legislation, the Basic Act on Electronic Transactions was formed into one of the two basic e-commerce laws for South Korea. Otherwise known as the umbrella law, chapter III of the Basic Act states that unless consent has been given, online dealers are not allowed to use or give access to a third party personal information received through e-commerce. According to Privacy International, a study by the Korea Information Security Agency in November 1999 found that many websites were collecting personal consumer information but were lacking in adequate privacy policies. [3]

The second basic e-commerce law that online business men and women should be familiar with in South Korea is the Electronic Signature Act. The Electronic Signature Act’s purpose is to achieve the security of electronic documents by placing a computerized signature on authorized documentation. [4] This gives business people the opportunity to interact with a wide variety of clients in other countries and the convenience of authorizing documentation generated through electronic means. Instead of sending a proposal or other document across to the United States and waiting for a written signature to be mailed back within a week, South Korea has issued the Electronic Signature Act so that these minor delays do not interrupt the online and offline business cycle. In 2002, the Electronic Signature Act was amended making changes to the different forms of electronic signatures that were now being accepted in South Korea. Such digital forms include: fingerprint, voice, and iris recognition. [1]

Throughout the last fifteen years, the Internet has evolved into an online business market where buyers and sellers join together to trade a variety of goods and services all around the world. Electronic commerce has entered into countries like South Korea and has made trading more efficient than others in the way online business is conducted and in the laws that each must follow. As e-commerce has emerged, so has new regulations conducting the business performance of South Korea. South Korea has provided two basic e-commerce laws that regulate how online business must be legally controlled in its country: 1) the Basic Act on Electronic Transactions and 2) the Electronic Signature Act. From privacy protection to digital signatures, e-commerce laws give South Korea a competitive advantage over other online business markets around the world.

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References:

[1] South Korea: Overview of e-commerce, http://globaltechforum.eiu.com/index.asp?layout=rich_story&doc_id=11157&title=South+Korea%3A+Overview+of+e-commerce&channelid=4&categoryid=30

[2] E-Commerce in South Korea and Korean-Chinese Cooperation, http://unpan1.un.org/intradoc/groups/public/documents/un/unpan001193.pdf

[3] Privacy International Country Reports, http://www.privacyinternational.org/survey/phr2000/countrieshp.html

[4] Electronic Signature Act, http://www.japanpkiforum.jp/shiryou/sankou/KR_ESA2001_E.pdf

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