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Newsletter | October 2016, Issue 3
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TECHNOLOGY, MEDIA & TELECOMMUNICATIONS
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Korean Legislature Passes the Amendments on the Voluntary Rating System to the Game Industry Promotion Act
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On May 19, 2016, the National Assembly passed the proposed amendments (the “Amendments”) to the Game Industry Promotion Act (the “Act”)2, which will become effective on January 1, 2017.
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Introduced in late last year3, lawmakers introduced the Amendments in response to the rapidly changing gaming industry, including new platform introductions, such as IPTV and Virtual Reality devices (VR) that do not belong to any of the existing classifications.
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Key Change – Self-rating Operators May Now Rate Games:
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The Amendments include a new provision, allowing self-rating operators to rate games. These self-rating operators are to be designated by the Minister of the Ministry of Culture, Sports and Tourism (“MCST”).
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If designated as self-rating operators, they can rate games on their own, including those that they have developed, as well as games they publish.
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In the case of platform service providers, self-rating operators can rate games that are provided on the platform (except for games that are not suitable for youth, and arcade games that can raise the risk of gambling).
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Government’s Demonstrated Efforts: This Amendment demonstrates the South Korean government’s effort to promote freedom of expression, and guarantee the autonomy of the private sector regarding the rating of games by permitting self-rating (private) operators to be established. Previously, this rating authority was generally given to the Game Rating and Administration Committee (“GRAC”), a public institution.
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Removed Provisions:
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However, it is important to note that in exchange for the new authority given to self-rating operators, the Amendments removed the provisions that currently recognize the authority of online open market operators to self-rate their games. In a subsidiary statute, lawmakers provide for a two-year transitional period.
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As such, online open market operators will not be able to distribute games through their self-rating system after such a 2-year period, unless the online open market operator is separately designated as a self-rating operator.
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While the Amendments include criteria for being designated as a self-rating operator, we expect the MCST and the GRAC to provide more detailed criteria (i.e., delegation of power through an ordinance of the MCST).
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Recommendation: Accordingly, impacted businesses (such as an online open market operator who wish to be designated as a self-rating-operator) should regularly monitor the relevant updates, and carefully review the detailed criteria (once prepared), so that you can be designated as a self-rating operator within the transitional period.
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Implication for Foreign Companies:
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Under the current regulations, foreign games made by foreign companies that do not have a presence in Korea cannot apply for a rating. Thus, foreign companies could find themselves in violation of the Act for providing games that have not been rated (even when domestic users gain access to the games through regular routes).
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However, the Amendments include a provision allowing self-rating agencies to provide such foreign games to domestic users (except for games that are provided to Youth Game Suppliers and General Game Suppliers), as long as the game’s main purpose is not domestic distribution.
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Impact: With this, even foreign companies that do not have a domestic presence will be able to provide their games to domestic users. As such, once the Amendments become effective in January, overseas game producers will be able to avoid violating the Act by taking advantage of the Amendments.
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The Amendments were officially promulgated on May 29, 2016.
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The Amendments were introduced on November 6, 2015.
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Back to Main Page
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