Case Studies
[Veon] Beyond regulations, towards the future! “Regulatory Sandbox” Story ② “Mobile Driver’s License” Introduction Case
Plastic cards are a thing of the past – welcome to the mobile ID era! Recently, the Korean-style regulatory sandbox system has been implemented, and various new products and services are being launched to improve citizens’ convenience. Notably, the ‘Mobile Driver’s License,’ which made it possible to live without a wallet, is a key example. Previously, driver’s licenses were issued only in plastic form, but now they are being made available on users’ mobile devices. The current Road Traffic Act and its implementing regulations stipulate that driver’s licenses must be ‘86mm x 54mm (PVC (vinyl) 980.4g/㎡)’, preventing their issuance in other formats. Many people carry several of the same-sized ID cards in their wallets because they rarely use them, and this often results in a lack of them when needed or lost. According to statistics, over a million driver’s licenses were lost in 2017. To this end, the three major mobile carriers and the National Police Agency are seeking ways to allow citizens to conveniently carry driver’s licenses, and they ultimately received a temporary approval from the Ministry of Science and ICT through the regulatory sandbox system to introduce ‘Mobile Driver’s Licenses.’ With this temporary approval, ‘Mobile Driver’s Licenses’ can be used for ‘Driver’s License Verification’ and for ‘Personal Identification’ in daily life. As a result, users of the ‘Mobile Driver’s License’ service can now go out with just a mobile phone, such as when buying beer at a convenience store or renting a car or when driving. Now, will mobile national ID cards come too? The National Police Agency has been using ‘Mobile Driver’s Licenses’ in the driver’s license renewal or reissue and foreign driver’s license issuance processes at driver’s license testing grounds, and the three major mobile carriers and the National Police Agency intend to apply ‘Mobile Driver’s Licenses’ to various police administrative tasks, such as traffic police interrogations. They also plan to expand the scope to use them as verification for personal identification in financial institutions and government offices. In light of this trend, the government has announced that it will officially introduce mobile driver’s licenses by next year, and has amended the Road Traffic Act to provide a legal basis for mobile driver’s licenses, and is preparing to clarify detailed technical aspects, such as security, to respond to the development and service situation of new technologies. Therefore, the scope of ‘Mobile Driver’s License’ use is likely to continue to expand. In fact, in addition to Korea, mobile driver’s licenses are being introduced and operated in Louisiana, USA, and New South Wales, Australia, and many other countries are currently conducting pilot operations or are pursuing their introduction, and the scope of use is also continuing to expand. In Korea as well, after the Agency for Administrative Affairs & Technology issued ‘Smartphones based Digital ID’ last year, it has started issuing certificates for government employees and students, and recently, 12 people, including MP Im O-gyeong, proposed a revised law on national ID card issuance to address the issuance of mobile national ID cards. It seems that the issuance of mobile national ID cards is just around the corner. Check out the Regulatory Sandbox System The changes in lifestyle due to the introduction of these new technologies and services began with the Regulatory Sandbox System. If a new technology or service cannot be commercialized due to regulations, utilizing various regulatory sandbox systems can be a good way to address it. Law Firm Veat has gained experience reviewing more than 200 regulatory sandbox projects, and is providing legal guidance on the scope of regulations applied to new technologies or services and business plans, and is explaining the application procedures and support programs that many companies and businesses are curious about in relation to actual regulatory sandbox applications.
[202008] Monthly Veat August Issue_Sandbox FAQ
https://stib.ee/Veat
[Consulting] Providing legal consulting on the granting of stock options to foreign resident workers
Startup Esa is seeking to hire a foreign developer, John (pseudonym), who resides overseas and wishes to be employed by Esa, a domestic legal firm. To grant John stock options, they inquired with Veat Law Firm to verify whether he qualifies as an employee of Esa, who is recognized as an employee entitled to the same rights as those defined in the Labor Standards Act, considering that John is a foreign national who is not subject to the application of some domestic laws, and whether mandatory enrollment in the 4 mandatory insurances is required to be recognized as an employee. Veat Law Firm conducted legal review regarding whether John, a foreign worker residing overseas, qualifies as an employee of Esa. In cases where ICT technology-based companies determine hiring based on the worker’s residence, a legal review of whether the worker’s status as an employee is recognized is necessary. Veat Law Firm is a legal firm that thoroughly understands startups. It has extensive experience and consulting know-how regarding the entire process, from the establishment, operation, investment, and exit (capital recovery) of numerous startups. If you need legal advice while running a startup, please contact Veat Law Firm. Thank you. Veat Law Firm
[Legal Advice] Company Response Manual Regarding Industry Occupational Safety and Health Act for Malicious Complainants
A Company, operating an open-market platform, inquired Law Firm Veat regarding the measures it could take under the Occupational Safety and Health Act to address issues that arise during customer service interactions. Employers are required to take necessary measures to prevent health impairments for customer service workers (employees engaged in the work of selling goods or providing services to customers, either in person or via telecommunications networks, as defined under the “Act on Consumer Protection in Electronic Transactions”). (Article 41 of the Occupational Safety and Health Act, Paragraph 1) Article 41 (Measures to Prevent Health Impairments due to Customer Abuse) ① Employers shall take necessary measures to prevent health impairments for employees engaged in selling goods or providing services to customers, either in person or via telecommunications networks, as defined under the “Act on Consumer Protection in Electronic Transactions”. Accordingly, Law Firm Veat prepared a manual and provided legal review opinions to ensure A Company, as an employer, could effectively respond to malicious complaints in accordance with the Occupational Safety and Health Act. The Ministry of Labor is actively assisting employers and employees through the promotion of the ‘Handbook for the Health Protection of Emotionally Sensitive Workers’ and the distribution of promotional materials for the ‘Protection of Customer Service Workers’ Act. However, if you require a practical manual for your company to respond to malicious complaints in accordance with the Occupational Safety and Health Act, please contact Law Firm Veat. Thank you. Law Firm Veat
[Finance News] “Contracts worth hundreds of millions of won are being freely distributed”
[Startup Law Firm] CEO Choi said, “Since it’s difficult to hire lawyers in the IT and startup fields, half of the lawyers in the firm are from science and engineering backgrounds.” He continued, “We often ask interviewees what the most interesting app they’ve seen on their smartphones is. Because our lawyers are young and interested in new technologies, we communicate well with young startup CEOs.” Veat specializes in providing legal advice to startups and advising venture capital and private equity firms on contracts. He said, “Initially, we handled disputes related to IT, but we gradually took on more startup legal advisory work. Currently, we focus on preventing disputes rather than resolving them. We support startups by providing them with funding and equity, at least in terms of amount.” Check the article: https://www.fnnews.com/news/202008121810248161 Legal Consultation: https://pf.kakao.com/_VBmxdxb
[Consultation] Drafting of Personal Information Provision Consent Form for Collection of Personal Information of Minors
Law firm Veat prepared and provided the necessary minor personal information consent form when handling minor personal information. A, which operates educational applications, commissioned Law firm Veat to prepare a personal information consent form to be received in advance from minors in the event of receiving a request from an organization that purchased the app to create accounts for minors. Accordingly, Law firm Veat prepared and provided a personal information consent form that is suitable for A’s service and complies with the “Personal Information Protection Act” and related regulations. Recently, it was revealed that a globally famous application had illegally collected and leaked customers’ personal information. In response, the Communications Commission imposed a significant amount of fines and penalties for violations of personal information protection regulations. Furthermore, in light of this incident, the Communications Commission emphasized the need for greater vigilance in the enforcement of personal information regulations and continued monitoring, as it is likely that companies will also need to pay particular attention to personal information processing. Law firm Veat has a personal information dedicated team led by attorney Jo Eun-byul, who is a consultant attorney of the Personal Information Protection Committee, and provides legal advice to companies regarding their personal information, including the establishment of GDPR systems. If you need advice related to personal information, please contact Law firm Veat via contact Law firm Veat. Thank you. Law firm Veat
[Consulting] Exchange of Domestic Company Stocks and Foreign Company Stocks (Mini-Flip)
A, which operates businesses in both Korea and the United States, decided to grant the right to its investors to exchange their shares for shares in the parent company (U.S. subsidiary) after the investors initially invest in the subsidiary (Korean subsidiary) if necessary. In response, Law Firm Veat requested a review of the share exchange option agreement after A’s Korean subsidiary investment. Law Firm Veat conducted the share exchange agreement review, considering the differences in shareholdings between the Korean and U.S. subsidiaries and the differences in share conditions, in order to ensure that the investor's shareholding ratio and shareholder rights in the Korean subsidiary are maintained equally in the U.S. subsidiary after the share exchange. Related to the exchange of domestic subsidiary shares and foreign subsidiary shares, mini-flip, and foreign investment, if you need the help of legal experts, please contact Law Firm Veat. Thank you. Best regards, Law Firm Veat.
Are there any points I should be aware of when drafting an outsourcing development agreement?
Many times, when startups request development by entrusting it to a third party through IT outsourcing contracts, the specific specifications related to the development are not detailed. In this case, there may not be sufficient agreement between the parties regarding the deliverables, which can lead to misunderstandings and disputes. We would like to introduce one of the significant cases handled by Law Firm Veat. A company (Plaintiff) operating a SW wholesale business, B Company (Defendant), a program development and maintenance business, entered into a maintenance and repair contract for the ‘C Program’. As a result, the Plaintiff filed a lawsuit for ‘Claim for Unpaid Maintenance Fees.’ Law Firm Veat won the judgment in favor of the Plaintiff. This case involved a situation where the Plaintiff performed maintenance and repair work on the C Program, but the payment was overdue. The Plaintiff repeatedly requested payment from the Defendant, but the Defendant countered with a counterclaim for damages, claiming that the Defendant had not received adequate program upgrades. Therefore, we carefully reviewed the specific details of the contract between the Plaintiff and the Defendant, with particular focus on the scope of maintenance and repair fees, especially whether it included updates or upgrades for the C Program. Based on the contract, the written language, industry practices related to maintenance and repair work, and relevant case precedents, Law Firm Veat submitted evidence, including an email where the Defendant was informed that “costs would be incurred if the update work was included,” and successfully demonstrated that the C Program's updates were not included within the maintenance and repair scope of the contract. Focusing on “preventive maintenance and maintenance to always keep the C Program in a good state in case of malfunctions,” we were able to conclude that the Defendant’s argument was unreasonable. Ultimately, the Seoul Central District Court accepted all of Law Firm Veat’s arguments and dismissed the Defendant’s counterclaim, ordering the Defendant to pay the Plaintiff the full amount of unpaid payment and interest. To prevent outsourcing development disputes, it is advisable to clearly define the ‘subject matter’ in the outsourcing development contract. If you need legal expertise in drafting outsourcing development contracts, please contact Law Firm Veat. Thank you. Law Firm Veat
[202007] Monthly Veat July Issue_Contract Legal Issue Q&A
Law firm Veat https://stib.ee/JGN2
[Consultation] Legal review of Terms of Service due to member type change
A company that had been providing services separately for paid members and free members decided to boldly eliminate paid members and convert them all to free members. Accordingly, A Company commissioned Law firm Veat to review the terms of service regarding member type changes. Law firm Veat deleted terms and clauses that did not match the terms of service that A Company had previously notified, having eliminated paid members and converted them all to free members. Particularly, Law firm Veat carefully examined A Company’s terms of service to ensure there were no unfair terms by scrutinizing obligations that must be observed when sending advertising messages and messages for profit-oriented promotional purposes. Law firm Veat provides comprehensive consulting to online service providers such as those offering electronic commerce and telemarketing to comply with the “Act on Protection of Consumers in Electronic Transactions and Network Advertising,” the “Act on Promotion of Information and Communications Network Utilization and Protection of Information,” and the “Act on Regulation of Contracts,” etc. Specifically, this law firm performs various tasks such as drafting terms of service, privacy policies, and consent forms tailored to the specific services provided by each business, after identifying the content and type of service and the scope of obligations. If you are those who need legal review of terms of service due to member type changes, please contact Law firm Veat. Thank you. Law firm Veat.