CONTENTS
- 1. Leisure Industry | The Legal Framework Companies Need to Know
- - Marine Leisure Tourism Promotion Act
- - Water Leisure Safety Act
- 2. Leisure Industry | Business Registration and Operating Requirements
- - Water Leisure Business Registration Requirement
- - Grounds for Disqualification from Registration
- - Operator's License
- 3. Leisure Industry | Safety Management Obligations
- - The Operator's Safety Management Obligations
- - Prohibited Conduct During Operation
- - Operating Restrictions Based on Weather and Safety Conditions
- 4. Leisure Industry | Insurance Requirements
- 5. Leisure Industry | Points Often Missed in Practice
- - Missing an Operator's License Renewal
- - Continuing to Operate After the Registration Validity Period Expires
- - Treating User Safety Instruction as a Formality
- - Changing the Operating Zone or Equipment Without Filing an Amended Registration
- 6. Leisure Industry | Daeryun's System for Support Before and After Disputes
1. Leisure Industry | The Legal Framework Companies Need to Know
The leisure industry refers to the business of creating economic value by providing services such as transportation, lodging, facility operation, and equipment rental, all built around leisure activities conducted in a range of environments, including marine, aquatic, and land-based settings.
Korea's leisure industry is governed by a structure in which multiple statutes, such as the Marine Leisure Tourism Promotion Act and the Water Leisure Safety Act, apply separately according to the type of business and activity.
For a leisure company, the starting point of legal risk management is to identify precisely which statute governs its particular type of business.
Marine Leisure Tourism Promotion Act
The Marine Leisure Tourism Promotion Act is intended to promote leisure and tourism activities conducted in marine and coastal areas and to manage the related resources.
It defines the scope of marine leisure tourism broadly, covering fishing, marinas, water leisure, underwater leisure, cruises, sea bathing, marine ecotourism, and marine healing, and the Minister of Oceans and Fisheries establishes and implements a comprehensive plan every five years.
Leisure-industry operators should understand the policy direction set by this plan and reflect it in their business strategy.
Water Leisure Safety Act
The Water Leisure Safety Act is intended to secure the safety and order of water leisure activities and to support the sound development of the water leisure business.
Its main subjects are operators who use powered water leisure equipment such as personal watercraft, motorboats, rubber boats, and sailing yachts, as well as rafting operators and water leisure equipment rental operators.
It sets out detailed legal obligations in close detail, including business registration, safety management, and insurance requirements, and a violation can lead to consequences as serious as the cancellation of business registration.
2. Leisure Industry | Business Registration and Operating Requirements
To start a leisure-industry business, an operator must satisfy in advance the registration requirements and qualification standards that apply to its line of business and operating zone.
Operating without registration, or beginning a business while overlooking a ground for disqualification, can result in criminal punishment and administrative sanctions at the same time.
Water Leisure Business Registration Requirement
Anyone who intends to operate a business that rents out water leisure equipment or carries people engaged in water leisure activities on such equipment must register in advance.
If the operating zone is on the sea, registration is made with the chief of the coast guard station; if it is on inland waters, registration is made with the head of the city, county, or district, and the registration is valid for 10 years.
To continue operating after the validity period expires, the operator must renew the registration, and operating without registration or continuing a business during a period of business suspension is punishable by imprisonment for up to one year or a fine of up to 10 million won.
Grounds for Disqualification from Registration
The following persons may not register a water leisure business.
Grounds for disqualification that apply to a corporation's representative or officers should also be checked in advance.
Grounds for Disqualification |
A minor, a person under adult guardianship, or a person under limited guardianship |
Fewer than 2 years have passed since a custodial sentence for violating this Act |
Currently under a suspended sentence for violating this Act |
Fewer than 2 years have passed since cancellation of registration |
Operator's License
A person who operates powered water leisure equipment must hold an operator's license issued by the Commissioner of the Korea Coast Guard and must carry the license at all times while operating.
Operator's licenses are divided into the general operator's license (Class 1 and Class 2) and the yacht operator's license, and they must be renewed every 7 years from the date of first issuance.
If a license is not renewed, its effect is suspended from the day after the renewal period expires. Effectively aiding unlicensed operation or lending one's license is also subject to punishment.
3. Leisure Industry | Safety Management Obligations
In the leisure industry, a breach of safety management obligations can lead to business suspension or cancellation of registration.
Once an accident occurs, criminal liability and civil damages arise at the same time.
The Operator's Safety Management Obligations
A water leisure operator and its employees must perform the following obligations.
∙ Checking the weather and water conditions in the operating zone
∙ Taking immediate rescue measures and notifying the relevant authorities when an accident occurs
∙ Ensuring that users wear safety gear such as life jackets and providing safety instruction before boarding
∙ Deploying lifeguards or rafting guides at the site
∙ Deploying an emergency rescue boat
Prohibited Conduct During Operation
A violation of the following acts is a ground for business suspension or cancellation of registration.
Prohibited Conduct |
Allowing an unaccompanied minor under the age of 14, an intoxicated person, or a person with a mental illness to board |
Operating water leisure equipment beyond its passenger capacity |
Selling, providing, or allowing alcohol to be brought onto the equipment |
Operating outside the registered operating zone |
Using powered water leisure equipment for business without a safety inspection |
Using an emergency rescue boat for a purpose other than its intended use |
Operating Restrictions Based on Weather and Safety Conditions
When a weather advisory for a typhoon, high seas, or similar conditions is in effect, or when fog limits visibility to within 0.5 kilometers, water leisure activities themselves are prohibited.
In cases such as severe weather, water pollution, or the appearance of harmful organisms, the chief of the coast guard station or the head of the city, county, or district may restrict the operating zone or hours, or order a temporary suspension of business.
A violation of such an order is punishable by imprisonment for up to six months or a fine of up to 5 million won.
4. Leisure Industry | Insurance Requirements
In the leisure industry, carrying insurance is not optional but a legal obligation.
An owner of registrable powered water leisure equipment must take out insurance or mutual aid coverage within one month of acquiring it, and a water leisure operator must carry insurance covering both employees and users.
An operator without insurance is subject to an administrative fine of up to 1 million won, and when filing a report to resume business, the operator must first have its insurance coverage verified.
Failing to inform users of insurance coverage information, or providing false information about it, is also subject to an administrative fine.
5. Leisure Industry | Points Often Missed in Practice
Legal problems in the leisure industry often stem from the belief that "as long as there is no safety accident, everything is fine."
The following are common situations that cause problems in actual practice.
Missing an Operator's License Renewal
An operator's license must be renewed every 7 years.
Once the renewal period passes, the license is automatically suspended, so the moment a person operates the equipment, it becomes unlicensed operation.
Managing the validity period of employees' licenses is the operator's responsibility.
Continuing to Operate After the Registration Validity Period Expires
Continuing to operate without renewal after the business registration validity period (10 years) expires constitutes unregistered operation.
Beyond the penalty itself, legal liability for any accident occurring during this period may be increased.
Treating User Safety Instruction as a Formality
Safety instruction before boarding is a legal obligation of the operator.
If an accident occurs when the instruction was inadequate or omitted, criminal punishment along with civil liability for damages is increased significantly.
Changing the Operating Zone or Equipment Without Filing an Amended Registration
When a registered item changes, an amended registration must be filed.
Failing to do so can be a ground for cancellation of registration.
6. Leisure Industry | Daeryun's System for Support Before and After Disputes
Legal disputes in the leisure industry often unfold with administrative sanctions (business suspension or cancellation of registration), criminal punishment, and users' claims for damages all proceeding at the same time.
When an accident occurs, in particular, whether the safety management obligations were met becomes the central issue, so building an operating system that meets the legal requirements as a matter of routine is the most effective form of risk management.
Prevention
∙ Building a system to manage employee qualifications, including operator's licenses and completion of safety training
∙ Advisory on regular checks of compliance with safety management obligations and prohibited conduct
∙ Review of who is subject to insurance and mutual aid requirements and of an appropriate scope of coverage
∙ Advisory on reflecting the marine leisure tourism comprehensive plan and on related permits and licenses
Response
∙ Responding to criminal investigations related to water leisure safety accidents
∙ Responding to claims for damages by users and employees
∙ Raising objections to and contesting administrative fines and penalty surcharges
∙ Responding to administrative disputes related to violations of operating restrictions and orders
The point right after a safety accident occurs, or the point at which an administrative agency gives notice that it is starting an investigation, is the most important time to respond.
Daeryun Law Firm includes many entertainment attorneys with an understanding of and specialized knowledge in the leisure and entertainment fields.
If you need legal advice regarding the leisure industry, you can have your case assessed through the 🔗entertainment attorney legal consultation booking page.
