SOUTH KOREA Law and Practice Contributed by: Wooyoung Choi, Suhhee Han, Seonghwan Ju and Matt Younghoon Mok, Lee & Ko
cipal obligations applicable to information processors include the following. Collection, Use, and Provision of Personal (Credit) Information In principle, any person collecting, using, or provid- ing personal (credit) information must obtain the prior consent of the data subject unless a statutory excep- tion applies. Outsourcing of Personal (Credit) Information Processing A party outsourcing the processing of personal (credit) information must disclose such outsourcing arrange- ments through its privacy policy or other public dis- closures. In certain cases, a party outsourcing the pro- cessing of personal credit information is also required to report such outsourcing to the Financial Services Commission (FSC). Exercise of Data Subject Rights Personal information controllers and credit informa- tion providers/users must comply with requests from data subjects to exercise rights such as the right of access, withdrawal of consent, correction, and dele- tion, unless a statutory exception applies. However, there is currently no clear regulatory guidance or judi- cial precedent regarding how such rights can practi- cally be exercised and implemented within a block- chain environment. Destruction Obligations Personal information controllers and credit informa- tion providers/users are generally required to destroy personal (credit) information once it becomes unnec- essary for the relevant processing purpose, unless a statutory exception applies. However, because permanent deletion of certain information may be technically impossible in blockchain environments, the Enforcement Decree of the PIPA was amended to recognise the conversion of such information into irrecoverable anonymous information as a permissible
forgery, alteration, or damage of personal information, including the establishment of internal management plans and the retention of access logs. 1.1.4 Smart Contracts Currently, no separate law or regulation exists in Korea specifically governing “smart contracts,” and no court precedents have directly addressed them so far. That said, whether a “smart contract” is enforceable in Korea is determined not by its form, but by whether the underlying legal relationship satisfies the require- ments under the Korean Civil Act and other applicable laws. In other words, if there is an offer, acceptance, and mutual consent, a contract may be deemed val- idly formed even if it is in the form of a smart contract. Therefore, where there is a valid agreement between the parties on the substance embodied in the code structure of the smart contract, the contract would In Korea, there are numerous blockchain-related asso- ciations and industry organisations, including the Digi- tal Asset eXchange Alliance (DAXA), the Digital Asset Protection Foundation, the Korea Blockchain Associa- tion, the Korea Fintech Industry Association (KORFIN), the Open Blockchain and DID Association (OBDIA), the Korea Web3 Blockchain Association (KWBA), the Digital Convergence Industry Association (DCIA), and the Korea Blockchain Industry Promotion Association (KBIPA). 1.2 Crypto-Assets 1.2.1 Property Considerations likely be considered validly formed. 1.1.5 Industry and Trade Bodies Korea has no law specifically governing the own- ership and transfer of virtual assets. Korean courts generally take the position that virtual assets do not constitute “objects (or tangible property)” ( mulgeon ) under the Korean Civil Act that are capable of owner- ship. However, courts have recognised virtual assets as intangible interests with economic value and, in practice, have treated them similarly to claims for fun- gible goods. More specifically, the Korean Supreme Court has held in criminal cases that virtual assets such as Bitcoin constitute merely electronic information without physi-
method of destruction. Protective Measures
Personal information controllers are required to imple- ment technical, administrative, and physical safe- guards necessary to prevent the loss, theft, leakage,
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