SOUTH KOREA Law and Practice Contributed by: Jeena Kim, Kyunghwan Lee, Eunyoung Row and Bochan Kim, Bae, Kim & Lee LLC
9. Assessment 9.1 Assessment of the Applicable Enforced Legislation As a party to the Organisation for Economic Co- operation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, South Korea’s implementation and enforcement of the Convention is subject to comprehensive peer-review monitoring, co-ordinated by the OECD Working Group on Bribery across multiple phases. Among other matters, in June 2021 Korea submit - ted its two-year written follow-up report to the OECD Working Group on Bribery, detailing the actions taken to address the 36 recommendations and follow-up issues from its December 2018 Phase 4 evaluation. Based on this report, the Working Group concluded that Korea had fully implemented ten recommenda - tions, partially implemented 12 and not implemented 14. The Working Group acknowledged Korea’s efforts to strengthen its framework for investigating and pros - ecuting foreign bribery. This includes clarifying certain aspects of the foreign bribery offence as per Article 1 of the Convention, improving co-operation between the Supreme Prosecutor’s Office and the National Police Agency, allowing telecommunications inter - ception and enhancing mutual legal assistance use in foreign bribery investigations. Additionally, several Korean agencies (such as the Ministry of Foreign Affairs, the Ministry of Justice, the Korean Trade- Investment Promotion Agency, Eximbank, KOICA and the National Taxation Service) have provided training and guidance to their staff on foreign bribery red flags to ensure that suspected foreign bribery is reported to law enforcement. These efforts are promising, and the Working Group hopes that they will lead to improved detection and enforcement of foreign bribery. However, the Working Group also expressed concern over the large number of recommendations that are only partially implemented or that remain unaddressed. In particular, Korea must intensify efforts to provide sufficient training and guidance to law enforcement on foreign bribery investigations to ensure proactive
8.2 Compliance Guidelines and Best Practices
In South Korea, there are no compliance programme guidelines similar to (for example) the US Department of Justice’s “Evaluation of Corporate Compliance Pro - grams” issued at the Ministry of Justice level. How - ever, two key compliance programme guidelines have been published by regulatory authorities. The Korea Fair Trade Commission (KFTC) introduced the Fair Trade Compliance Program (the “Fair Trade CP”) in 2001 to promote fair and autonomous mar - ket operations by corporations. At the time of its ini - tial implementation, the programme was operated through policy recommendations, administrative rules and notices issued by the KFTC, encouraging volun - tary adoption by the market. In 2023, amendments to the Fair Trade Act established concrete legal grounds for the programme, along with detailed provisions for evaluation and incentives. These amendments were set to take effect in June 2024. Under the revised framework, incentives such as reductions in correc - tive measures or fines are provided to companies that demonstrate exemplary compliance performance. Separately, the ACRC issued the Integrity and Eth - ics Compliance Program Guideline for State-Owned Enterprises (commonly referred to as “K-CP”) in 2022. This guideline aims to encourage public institutions to autonomously prevent corruption and to foster a culture of integrity and ethical management. The K-CP and the Fair Trade CP differ in scope and focus, as the K-CP targets domestic public enterprises, addressing ethical and anti-corruption risks, while the Fair Trade CP applies to all enterprises, focusing on managing
risks related to fair trade practices. 8.3 Compliance Monitorships
Non-trial resolution, such as deferred prosecution agreements and non-prosecution agreements, are not available in South Korea. Hence, enforcement bodies do not have the option of seeking a compliance moni - tor as part of corporate resolutions.
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