Foreign Trade Act | The Constitutional Court's Determination That the Situational Permission Provisions for Strategic Items Are Not in Violation of the Constitution

The Seoul Central District Court argued that the former Foreign Trade Act did not clearly define the concepts of “strategic items, weapons of mass destruction, conventional weapons, and the like,” and that, for this reason, (i) the requirements for export permission were unclear and (ii) the persons subject to the law (companies) found it difficult to foresee whether their conduct was subject to punishment, thereby violating the principle of clarity under the principle of legality in criminal law and the principle prohibiting blanket delegation.

In particular, it pointed out that the expression “grounds that harm the changing international situation or national security” was excessively abstract, and that the part leaving such matters to be prescribed by notice of the Minister of Trade, Industry and Energy delegated fundamental legislative matters to the executive branch.

In the event of a violation of the situational permission provisions, the offender is, pursuant to Article 53(2), Item 4 of the Foreign Trade Act, subject to imprisonment with labor for not more than five years or a fine not exceeding an amount equal to three times the value of the goods exported, imported, transited, transshipped, or brokered.

In addition, Article 31 of the Foreign Trade Act provides that, in the case of export without permission, the export and import of all or part of the strategic items, and the like, may be restricted for a certain period within a range of up to three years.

The Constitutional Court stated that “the provision subject to review can be assessed, through the principle prohibiting blanket delegation, by reference to the specificity and clarity of the part delegated to the notice,” and that there was no need to separately assess whether the principle of clarity had been violated.

In other words, it reaffirmed the position that, even where abstract expressions exist, so long as the foreseeability of the persons subject to the law is secured, the essence of the principle of legality in criminal law is not contravened.

Daeryun Law Firm LLP provides the following assistance in cases relating to the Foreign Trade Act.

▶Response Centered on Advance Risk Assessment

▶Strengthening the Internal Control System and Self-Classification Capacity

▶Parallel Administrative and Criminal Response

▶Evidence Verification Based on Digital Forensics

To prevent the risk of violating the Foreign Trade Act, companies may wish to establish systems for advance classification, internal control, and specialized advice.

At Daeryun Law Firm LLP, attorneys handling international trade matters and customs matters, a customs specialist who holds a licensed customs broker qualification, a foreign attorney (United States) advising on U.S. law, and the Digital Forensics Center work together to diagnose in advance the legal risks that may arise throughout a company's export and import process, and to respond promptly when a dispute arises.

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