Criminal enforcement of copyright and unintended consequences: Lessons of KORUS for RCEP
by Heesob Nam
Soon after the signing of the Korea-US FTA (“KORUS”) in June 2007, South Korea experienced a dramatic increase of complaints of copyright crime from 2007. Around one hundred thousands of persons were accused of copyright infringement in a year, and juvenile’s victims occupied 24% in 2008.
But the actual indictments by the prosecutors were very small: from 2005 to 2013 on average only 7.38% of the complaints were brought to the court. Most of them were for summary proceedings and public trial occupied only 0.22%. Notably in 2008, among the complaints as many as 90,979, only 8 complaints led to the public trial (0.00879%). Among the complaints that were not indicted by the public prosecutors in 2008, around 60% cases were withdrawn by the complainants.
These unimaginable figures, i.e., the skyrocketed increase of criminal complaints on the one hand and the tiny portion of actual trial on the other hand are for two reasons.
First, the threshold for entering the criminal procedure is too low – almost nothing. The only threshold is knowingness. Any infringing act is subject to criminal penalty regardless of the nature or seriousness of offense.
Second, the criminal enforcement has been strategically abused by copyright holders and lawyers. The threat of criminal sanction became a new business model since 2007 when KORUS officially signed. Most of the complaints, 63% in 2008, were raised by law firms. They hired special agents to regularly monitor the Internet and sent warning letters to individuals who conducted technically copyright infringing activity, threatening criminal actions. In exchange of stopping the criminal action, they asked a cash settlement. The criminal enforcement procedure provides copyright holders with a leverage using the threat of criminal action as the initiation of criminal procedure is subject to a complaint by the right holder.
The phenomenon so-called a “business of copyright settlement money” has been widespread and become a serious social problem in Korea for nearly a decade. To fix this problem, several bills to raise the threshold of the copyright criminality has been introduced in the National Assembly. The latest effort makes the statutory requirements for criminal sanction: a for-profit purpose; or harm or injury to copyright holder of more than KRW one million.
The copyright industries and like-minded scholars and practitioners presented a united front to the bill when it passed the competent committee in April 2014 and had a legal formality examination ahead. Their opposition was based, among others, on possible disputes with foreign countries, predicted complaints from foreign authors, degradation of general public’s recognition on copyright protection, and breach of KORUS, which requires criminalizing copyright violation for purpose of private financial gain. Due to their strong resistance, the reform bill was finally foundered in May 2016.
 The number of complained reduced to a half since 2010 when the Ministry of Culture and the Prosecutors’ Office took an interim measure not to prosecute those who were first involved in the copyright infringement crime or minors.
 The summary proceedings, also called summary indictment, refer to a court proceeding by which judge orders, without attendance of the accused, a fine or penalty. See, Korean Minister of Justice, Criminal case procedures available at http://fgn.kics.go.kr/en/jsp/cjp/criminalCaseProcedures09.jsp.
 The threshold of KRW one million was modeled on the US laws of “during any 180-day period … a total retail value of more than $1,000 (17 U.S.C. § 506(1)(1)(B)).