On June 2, 2023, the Ministry of Trade, Industry and Energy (the “MOTIE”) published the “Notice on Selection of National High-Tech Strategic Technology” (MOTIE Notice No. 2023-108, hereinafter referred to as the “Notice”), and designated a total of 17 technologies in the semiconductors, displays, secondary batteries, and bio industries as “National High-Tech Strategic Technologies.”
On August 4, 2022, the Act on Special Measures for Strengthening and Protecting the Competitiveness of the National High-Tech Strategic Industry (the “Special Act”) came into force. It was enacted on February 22, 2022 to preserve national security and economic security interests in high-tech strategic industries. Pursuant to the law, in the first meeting of the National Advanced Strategic Industry Committee (the “Strategic Committee”), 15 national high-tech strategic technologies in three industry sectors (i.e., the semiconductor, display, and secondary battery industries) were identified. However, a list of applicable technologies with technical details has not yet been made public.
However, with the release of the current Notice, a total of 17 national high-tech strategic technologies have been identified, clearly outlining the scope of application of the Special Act.
National high-tech strategic technologies are technologies that meet the parameters listed in the table below and are used in or developed to be used in mass production. Many of the selected national high-tech strategic technologies overlap with the national core technologies under the Act on Prevention of Divulgence and Protection of Industrial Technology (the “Industrial Technology Act” or “ITA”) but have differing technology specifications. Moreover, as demonstrated in the table below, new technologies in the display and bioindustries have been added to the list (the newly added technologies are shaded in grey).
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Category |
Technology |
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Semiconductor (8) |
Design, process, and device technology and 3D stack formation technology applicable to a DRAM of 16 nm or less |
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Stack assembly technology and inspection technology applicable to a DRAM of 16 nm or less |
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Design, process, and device technology applicable to a 3D NAND Flash of 128 or more layers |
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Stack assembly technology and inspection technology applicable to a 3D NAND Flash of 128 or more layers |
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Image sensor design, process, and device technology for 0.8㎛ or smaller pixels |
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OLED display driver IC design technology for display panel operation |
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Process and device technology and 3D stack formation technology applicable to a Foundry of 14 nm or less |
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Process, assembly, and inspection technology applicable to high-tech packages for system semiconductors, such as FO-WLP, FO-PLP, FO-PoP, or SiP |
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Display (4) |
AMOLED panel design, manufacturing, process, and operation technology (ultra-small size of 3,000 ppi or more, small size of 500 ppi or more, mid-size of FHD or more, and large display of 4K or more, excluding module process technology) |
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Design, manufacturing, process, and operation technology for panels made of eco-friendly QD with a half width of 40 nm or less (color reproduction rate of 90% or more under REC2020, excluding LCD and module technology) |
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Design, manufacturing, process, and operation technology using a micro LED display panel of 30㎛ or less (ultra-large chip size of 30㎛ or less, mobile chip size of 20㎛ or less, and ultra-small chip size of 5㎛ or less) |
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Design, manufacturing, process, and operation technology for a nano LED display panel of 1㎛ or less (excluding module technology) |
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Secondary battery (3) |
Technology for design, process, manufacturing, and evaluation of high energy density lithium secondary batteries (pouch-type batteries with an energy density of 280Wh/kg or more, square-type batteries with an energy density of 252Wh/kg or more, cylindrical batteries with a diameter of 21mm or less with an energy density of 280Wh/kg or more, and cylindrical batteries with a diameter exceeding 21mm with an energy density of 260Wh/kg or more) |
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Technology for design, manufacturing, and process of high-capacity cathode materials for lithium secondary batteries (containing over 80% of nickel) |
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Design, process, manufacturing and evaluation technology for ultra-high-performance electrodes (silicon graphite composite anode, sulfur cathode, and lithium metal anode) of 600 mAh/g or higher or next-generation lithium secondary batteries (all-solid-state batteries, lithium-sulfur batteries, and lithium metal batteries) |
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Bio (2) |
Animal cell culture and purification technology applied to the development and manufacture of biopharmaceuticals (multi-use bioreactor cell culture: 10,000 liters or more) |
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Organoid differentiation and culture techniques applied to develop and manufacture high-quality organoid regenerative agents (scale of culture of autologous and homologous organoid regenerative agents: 100 dose/lot or more, organoid target cell composition by organ: 80% or more, organoid survival by organ: 80% or more) |
Pursuant to the Special Act, these national high-tech strategic technologies are subject to the following regulations:
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Regulation of Export and Overseas M&A
A holder of a national high-tech strategic technology must obtain approval from the MOTIE if the holder (i) intends to export the technology to a foreign company by sale, transfer, or other means or (ii) intends to proceed with an overseas acquisition, merger, joint venture, etc. However, the export of materials, parts and devices and the provision of information that commonly accompanies such exports without details that would allow the implementation of the national high-tech strategic technology are exempt. -
Protective Measures
The Special Act requires national high-tech strategic technology holders to take protective measures to prevent the leakage of national high-tech technologies, which include (i) designating protected areas under access control and inspecting personal belongings at entrances and exits, and (ii) monitoring the job transfer of personnel handling national high-tech strategic technologies and executing non-disclosure agreements. The Government may increase protective measures as well as the personnel to manage the additional regulations compared to the measures for national core technologies previously required under the ITA.
The regulations relating to national high-tech strategic technologies under the Special Act are linked to the regulations for NCTs under the ITA. In fact, national high-tech strategic technologies are considered a subset of NCTs. Thus, if the requirements for national high-tech strategic technologies are satisfied (e.g., MOTIE reporting or approval requirements) the requirements under the ITA (Article 12, Paragraph 5 and Article 13, Paragraph 8) for NCTs will also be deemed to have been satisfied.
While companies that possess national high-tech strategic technologies will be subject to additional regulations and protective measures for exports or overseas M&As related to pertinent technologies, they may also qualify for various government support programs such as tax reductions. With the scope of national high-tech strategic technologies now specified, companies possessing relevant technologies should carefully review whether they are affected and properly respond to the applicable regulations.
In particular, as the designated technologies include a large number of national core technologies, companies that hold national core technologies should also thoroughly examine whether their technologies are also considered as national high-tech strategic technologies. If the technology is deemed both a national core technology and national high-tech strategic technology, careful attention should be paid when implementing certain procedures, including how to proceed with ongoing export processes and whether approval procedures under both the ITA and the Special Act must be carried out. As the Strategic Committee is considering expanding the scope of national high-tech strategic technologies to industries such as the robotics and futuristic vehicles industries, affected companies should keep abreast of the regulatory trends.
