As South Korea aims to expand defense exports to the U.S. and become one of the world's top four arms exporters, CMMC has become a critical requirement.
CMMC has three levels, based on the sensitivity of Federal Contract Information (FCI) and Controlled Unclassified Information (CUI).
Most defense firms may need to prepare for Level 2, which requires meeting all 110 security requirements outlined in NIST SP 800-171. Companies handling critical controlled unclassified information (CUI) must also undergo an audit by a certified third-party assessor organization (C3PAO) every three years. Preparation typically takes 12 to 18 months, and total costs - including infrastructure, consulting, and certification - can range from 260 million won (US$177,000) to 400 million won per company.
The burden falls largely on smaller suppliers. A recent survey by the Korea Defense Industry Association (KDIA) found that nearly all small and mid-sized companies lacked dedicated security staff. The most commonly cited challenges were cost, as well as a lack of information and training. About one-third said they had no plans to invest in CMMC certification, despite their interest in entering the U.S. market.
Technical barriers are just as daunting. Level 2 requires encryption standards validated under U.S. rules (FIPS 140-2/140-3), and South Korea's own equivalent certification is not recognized because no mutual recognition agreement exists between the two countries. Requirements like multi-factor authentication can force companies to overhaul their entire security infrastructure. Of the 110 requirements, 61 must be fully met before a contract is signed, with no exceptions or grace periods allowed. To make matters more difficult, South Korea has no accredited C3PAO, meaning companies must rely on foreign firms, raising costs and concerns over language barriers and potential technology leakage.
In this context, the legal grounds for support should go beyond assistance for system-building and consulting costs. Revisions are needed to explicitly include certifications and qualifications required for defense exports as a basis for subsidies.
Existing security inspections should also be restructured to align with CMMC requirements, allowing companies to meet both without duplicating efforts. Firms that complete CMMC self-assessments or obtain certification should also be eligible for exemptions from overlapping inspection requirements.
Building a domestic CMMC ecosystem is equally important. South Korea needs its own accredited C3PAO, and the government should actively support efforts to establish one. At the same time, authorities should engage directly with the DoD to address key sticking points, particularly rules around foreign ownership and influence, and requirements for high-level background checks.
More funding is needed, as the current 800 million won for defense technology protection systems and 750 million won for consulting support for small defense firms are not enough to meet demand. Budgets for individual programs should be increased, and a dedicated fund could also be established to manage resources more effectively. Cost structures also need reform, as security spending is currently treated as an indirect cost, making it difficult to plan for and discouraging proactive investment.
CMMC is not something companies can adopt quickly, but it cannot be avoided for those seeking to stay in the U.S. market. Competing arms exporters are already treating CMMC readiness as a national priority and supporting their companies systematically.
Without coordinated action, South Korean suppliers risk losing their position to global competitors. An integrated approach involving the government, local authorities, and relevant industries is needed, and a cross-ministry consultative body should be established and begin work without delay. The next decade for South Korea's defense industry will depend on how it gets through this challenge.
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