NFC based service legal risk management cases

Law firm Veat provided professional legal advice to prevent legal risks in the process of a domestic entity (hereinafter “customer”) providing new digital services utilizing NFC technology.

NFC technology is an abbreviation for ‘Near Field Communication,’ meaning a short-range wireless communication technology. This NFC technology is widely used in everyday life in the form of digital door locks, controlling entrance, electronic payments like transportation cards, etc.

This case involves reviewing the personal information processing policy and terms of service for the customer's NFC-based service to minimize the customer's legal risks.

Features and Precautions for Providing NFC-based Services

 

1. Features of Providing NFC-based Services

This case stemmed from a customer's request to review their personal information processing policy and terms of service for an entity operating a product with NFC functionality that connects users with specific webpages and content.

Since the customer's service is structured to allow users to tag a product via NFC technology and immediately connect to designated content, legal elements such as collection and processing of user personal information must be considered during the service provision process.

2. Precautions for Providing NFC-based Services

1) Writing Easy and Clear Terms

Act on Regulation of Standard Clause Contracts Article 1 (Ease of Understanding of Standard Clause) Business entities shall draft standard clause contracts in Korean so that customers can easily understand the contents thereof, use standardized and systematized terms, and clearly indicate important content of the standard clause contracts by means of symbols, colors, and bold and large letters so that customers may readily understand the standard clause contracts. Article 1 (General Principle) A standard clause provision that violates the principle of good faith and fairness loses its fairness. Provisions specifying the contents equivalent to any of the following items shall be presumed to lose their fairness. 1. A provision that is disadvantageous to the customer in an unreasonable manner. 2. A provision that the customer cannot reasonably anticipate in view of all circumstances related to the transaction. 3. A provision that unreasonably restricts the essential rights accompanying the contract so as to make it impossible to achieve the purpose of the contract.

 

According to the “Act on Regulation of Standard Clause Contracts” (hereinafter “Standard Clause Act”), business entities must draft standard clause contracts in Korean so that customers can easily understand the contents and clearly indicate important content so that customers can easily understand the standard clause contracts. Furthermore, provisions that customers cannot reasonably anticipate may be deemed unfair and may lose legal effect.

In the case of NFC-based services, there is a high possibility that people will not accurately understand the content and process of providing the service, as it is a recently emerged service. Therefore, it is necessary to draft the terms of service so that users can easily understand the contents by clearly defining new terms such as NFC product, connection link, arrival link, and redirect link.

Law firm Veat considered the Standard Clause Act and the stance of relevant authorities and provided legal advice to ensure that the customer's service terms of service do not violate the Standard Clause Act.

2) Necessity of Disclaimer

In the case of NFC-based services, users access external content set by the business entity. When accessing such external content, there is a risk that unforeseen problems may occur that the business entity could not have anticipated. Therefore, it is necessary to add a clause to the terms of service that informs users of this fact and clearly exempts the company from responsibility.

3) Necessity of Review Related to Personal Information Protection

Personal Information Protection Act Article 1 (Establishment and Disclosure of Personal Information Processing Policy) ① The personal information controller shall establish and maintain a personal information processing policy (hereinafter “personal information processing policy”) including the following items. In this case, the public institution shall register the personal information file subject to Article 32 in accordance with Article 32. 1. ~ 8. (Omitted) ② The personal information controller shall publicly disclose the personal information processing policy using a method prescribed by Presidential Decree when establishing or revising the personal information processing policy.

 

In the case of NFC-based services, there is a possibility that the business entity will collect personal information of service users. When operating personal information files for business purposes and processing personal information, the entity may be subject to the Personal Information Protection Act and must establish and publicly disclose a personal information processing policy if it is considered a personal information controller.

Law firm Veat provided legal advice to help the customer establish an optimized personal information processing policy based on a deep understanding of the Personal Information Protection Act and extensive experience in similar cases.

 

Customized Legal Advice from Law firm Veat with Expertise in IT and Personal Information

 

Law firm Veat has the highest level of expertise in the personal information and IT legal advice fields and supports the customer's sustainable growth by providing customized services that keep pace with the startup's rapid pace of change and innovation. It also provides optimized legal advice to customers based on its reputation as a finalist for the "ALB Korea Law Award."

Therefore, if you need legal review related to NFC technology and digital services, please feel free to contact Law firm Veat.

Thank you.

Law firm Veat