To fundamentally address the frequent issue of 'technology theft' in industrial settings, the mandatory implementation of non-disclosure agreements (NDAs) is being proposed.
On September 14, according to the National Assembly, Lee So-young, the nominee for Minister of SMEs and Startups, stated in written responses during her confirmation hearing that she would push for the mandatory use of NDAs during negotiation stages to prevent technology theft.
Technology theft typically occurs when large corporations or partners receive product designs, manufacturing processes, or business ideas from small and medium-sized enterprises (SMEs) and then use them without permission or develop similar products independently.
An NDA is a contract that prevents the parties involved from disclosing sensitive information exchanged before a formal agreement is made. Key provisions include the scope of confidential information, permitted uses, labeling of confidential information, confidentiality obligations, contract duration, and liability for damages.
In response to a question from Democratic Party lawmaker Song Jae-bong regarding the prevention system for technology theft in SMEs, Lee stated, "I believe it is necessary to not only mandate NDAs during negotiation stages but also to strengthen the protection of technical data through record-keeping and a technology deposit system." The technology deposit system involves securely storing a company's core technical information or trade secrets with a neutral third party.
According to a recent report by the Foundation for Cooperation between Large, Medium, Small Enterprises and Agriculture, the total losses incurred by domestic SMEs due to technology or management information breaches reached approximately 1.089 trillion won (about $1 billion) last year. According to the office of Democratic Party lawmaker Lee Jae-kwan, an average of over 300 cases of technology theft occur each year, with each case resulting in an average loss of about 1.8 billion won (approximately $1.8 million).
In March, the government established the 'Technology Theft Reporting Center for SMEs.' This center serves as a multi-agency reporting and consultation hub, allowing companies affected by technology theft to report incidents more easily and receive appropriate support. The Ministry of SMEs and Startups, the Ministry of Trade, Industry and Energy, the Fair Trade Commission, the Korea Intellectual Property Office, the National Police Agency, and the National Intelligence Service are all involved.
According to the 2027 budget proposal from the Ministry of SMEs and Startups, 24.7 billion won (approximately $24 million) has been allocated to enhance the multi-agency technology theft reporting center and to develop customized capacity-building packages based on assessments of technology protection levels, including expert consulting and security infrastructure development.
On September 14, according to the National Assembly, Lee So-young, the nominee for Minister of SMEs and Startups, stated in written responses during her confirmation hearing that she would push for the mandatory use of NDAs during negotiation stages to prevent technology theft.
Technology theft typically occurs when large corporations or partners receive product designs, manufacturing processes, or business ideas from small and medium-sized enterprises (SMEs) and then use them without permission or develop similar products independently.
An NDA is a contract that prevents the parties involved from disclosing sensitive information exchanged before a formal agreement is made. Key provisions include the scope of confidential information, permitted uses, labeling of confidential information, confidentiality obligations, contract duration, and liability for damages.
In response to a question from Democratic Party lawmaker Song Jae-bong regarding the prevention system for technology theft in SMEs, Lee stated, "I believe it is necessary to not only mandate NDAs during negotiation stages but also to strengthen the protection of technical data through record-keeping and a technology deposit system." The technology deposit system involves securely storing a company's core technical information or trade secrets with a neutral third party.
According to a recent report by the Foundation for Cooperation between Large, Medium, Small Enterprises and Agriculture, the total losses incurred by domestic SMEs due to technology or management information breaches reached approximately 1.089 trillion won (about $1 billion) last year. According to the office of Democratic Party lawmaker Lee Jae-kwan, an average of over 300 cases of technology theft occur each year, with each case resulting in an average loss of about 1.8 billion won (approximately $1.8 million).
In March, the government established the 'Technology Theft Reporting Center for SMEs.' This center serves as a multi-agency reporting and consultation hub, allowing companies affected by technology theft to report incidents more easily and receive appropriate support. The Ministry of SMEs and Startups, the Ministry of Trade, Industry and Energy, the Fair Trade Commission, the Korea Intellectual Property Office, the National Police Agency, and the National Intelligence Service are all involved.
According to the 2027 budget proposal from the Ministry of SMEs and Startups, 24.7 billion won (approximately $24 million) has been allocated to enhance the multi-agency technology theft reporting center and to develop customized capacity-building packages based on assessments of technology protection levels, including expert consulting and security infrastructure development.
* This article has been translated by AI.
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