Unfair competition Prevention

1) Overview

Unfair competition prevention and trade secret protection law broadly is composed of a portion of Intellectual Property Rights Laws, and the purpose thereof is to maintain the sound order in transactions by preventing acts of unfair competition, such as unfair use of domestically widely famous trademark, trade name, etc. of another person.

This Law prescribes concrete types of unfairly competitive acts.

2) Types of Unfair Competition

(a)  Act causing confusion with the goods of another person by using such a thing that is identical or similar to a name, trade name, trademark, container or package of goods of another person or other mark identifying the goods of another person which is widely recognized in Korea, or by selling, distributing, importing or exporting goods incorporating such a thing;

(b) Act causing confusion with another person's business facilities or activities by using such a hing that is identical or similar to a name, trade name, or emblem of another person or other mark identifying another person's business which is widely recognized in Korea;

(c) Other than the acts of causing confusion under items (a) and (b), an act damaging the identity of a mark or the fame of another person, by using such a thing that is identical or similar to a name, trade name, trademark, or container and package of goods of another person, or other mark indicating another person's goods or business, which is widely recognized in Korea, without any justifiable grounds as prescribed by the Presidential Decree such as non-commercial use, or by selling, distributing, importing or exporting goods incorporating such a thing;

(d) Act causing misunderstanding as to the place of origin by placing a false mark of the place of origin on goods or through advertisement thereof or by means informative to the public, on any commercial document or communication, or by selling, distributing, importing or exporting goods bearing such false mark;

(e) Act of placing on goods or through advertisement thereof or by means informative to the public, on any commercial document or communication, a mark that causes misunderstanding that the goods were produced or processed in an area other than the area where the goods were produced, manufactured or processed, or act of selling, distributing, importing or exporting goods bearing such mark.

(f) Act of falsely claiming the goods as another person's goods, act of advertising or placing on goods a mark that causes misunderstanding as to the quality, contents, manufacturing method, use or quantity of the goods, or act of selling, distributing, importing or exporting goods using such method or mark; and

(g) An act where any agent or representative of a holder of the right to a trademark registered with any party to the Paris Convention for the Protection of Industrial Property (referred to as the "Paris Convention"), with any member state of the World Trade Organization, or with any signatory state of the Trademark Law Treaty, or to a trademark similar thereto, or any person who had been an agent or representative of such holder within one year before the date of conducting the act in question, uses the trademark, without any justifiable grounds, on goods identical or similar to the designated goods of the relevant trademark, or an act where such agent or representative sells, distributes, exports, or imports the goods using the relevant trademark.

3) Prohibition of Use of National Flag, Emblem, etc.

(a) Prohibition of the Use of mark identical or similar to the national flag or emblem or other badges of a party to the Paris Convention, a member state of the World Trade Organization, or a signatory state of the Trademark Law Treaty, or a mark of any international organization as trademark: and

(b) Prohibition of the use of mark identical or similar to any mark for a control or certification which is used by the government of a party to the Paris Convention, a member state of the World Trade Organization, or a signatory state of the Trademark Law Treaty as Trademark.

4) Remedies for act of unfair competition

(a) Civil Liability

(i)  Claim for Prohibition of Act of Unfair Competition

A person who deems his business interests to be infringed on or potentially infringed on by an unfairly competitive act or by an act of infringing on trade secrets may file a claim with a court for prohibition or prevention of such act.

(ii) Liability for Damage Caused by Act of Unfair Competition

A person who infringes on another person's business interests and inflicts loss on him through an unfairly competitive act or an act of infringing on trade secrets, either intentionally or negligently, shall be liable to compensate for such loss.

(iii) Restoration of Credit Lost by Act of Unfair Competition

A court may order a person who has intentionally or negligently caused another person's business credibility to fall through an unfairly competitive act or an act of infringing on trade secrets to take a measure necessary for restoring the business credibility either in lieu of the compensation for loss or in addition to the compensation for loss.

(iv) Presumption of Damages

When a person whose business interests are infringed on through an unfairly competitive act or an act of infringing on trade secrets claims for compensation, and if the person who has infringed on the business interests has gained through the infringing act, the amount of the gain shall be presumed to be the amount of loss to the claimant.

(b) Criminal Liability

Imprisonment for no more than three(3) years, fine of no more than thirty million won

(c) Administrative Liability

The Commissioner of the Korean Industrial Property Office may recommend a person who commits an unfairly competitive act, etc. to suspend or correct the act upon determining a time period not exceeding thirty(30) days.

5) Another Way for Protection

If there are any provisions of the Patent Act, the Utility Model Act, the Design Act, or the Trademark Act which are different from this Act; and  

If there are any provisions of the national flag or emblem of the Monopoly Regulation and Fair Trade Act, the Act on Fair Indication and Advertisement, or the Criminal Act which are different from those of this Act, such provisions shall preferentially apply.