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Legal Intellectual

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Q

What punishment is imposed for a violation of the Unfair Competition Prevention and Trade Secret Protection Act?

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Our company manufactures and sells small accessories. When a new product came out, the designer was instructed to create a product detail page, but the designer referred heavily to a competitor's detail page and was reported by the competitor. If a violation of the Unfair Competition Prevention and Trade Secret Protection Act is recognized, could we even be subject to criminal punishment?

violation of the Unfair Competition Prevention and Trade Secret Protection Act

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A

Answer to Related Inquiry

Yes. You could also be subject to criminal punishment.

If a competitor's detail page is imitated to an excessive degree such that consumers may be confused, this constitutes an act of unfair competition, which amounts to a violation of the Unfair Competition Prevention and Trade Secret Protection Act.

If a person commits an act of unfair competition and a violation of the Unfair Competition Prevention and Trade Secret Protection Act is recognized, imprisonment for not more than 3 years or a fine of not more than 30 million won may be imposed.

An act of unfair competition means an act such as seeking to secure a competitive advantage by using another person's work product or the like without authorization and without paying due consideration.

Representative examples of acts of unfair competition

▶ The act of using another person's trademark, trade name, or other mark, or using a similar mark

▶ The act of passing off another person's goods or causing misconception as to the quality of goods

▶ The act of imitating the form of another person's goods

▶ The act of misappropriating an idea

Furthermore, if it is recognized that an act of unfair competition was committed, civil liability may also arise separately from criminal punishment.

If another person's trademark or the like was registered, held, or transferred without authorization, civil liability, such as a damages lawsuit for the violation of the Unfair Competition Prevention and Trade Secret Protection Act, may follow, so caution is required.

In such a case, it is advisable to seek advice and assistance from a specialized attorney in order to contest issues such as whether there was intent, the similarity, and the act of unfair competition itself.

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