Advance Legislation Notice of Criteria to Determine Foreign Game Companies to Designate Domestic Agent
Date Apr 24, 2025
Attachment
- Starting October 23 this year, the Domestic Agent Designation System will be implemented in accordance with a draft amendment to the Enforcement Decree of the Game Industry Promotion Act.
- The (Draft) Guide to the Domestic Agent Designation System under the Game Industry Promotion Act will be distributed in Korean and English.
The Ministry of Culture, Sports and Tourism (Minister Yu In Chon, MCST) announced that the advance legislation notice of a draft amendment to the Enforcement Decree (Decree) of the Game Industry Promotion Act (Act), which focuses on clarifying the criteria for determining foreign game companies subject to the requirement to designate a domestic agent, will be posted from Thursday, April 24 to Wednesday, June 4, 2025.
On October 22, 2024, the MCST amended the Act to impose a new obligation on foreign game companies of a certain size to designate a domestic agent in Korea (Article 31-2 of the Act). The purpose of the amendment is to enable domestic game users to conveniently contact foreign game companies without language barriers or other difficulties, and to strengthen management and supervision of foreign game companies to ensure that they do not violate domestic game distribution regulations.
The draft amendment to the Decree is a follow-up to the previous and corresponding amendment to the Act and contains the criteria to determine foreign game companies required to designate a domestic agent as delegated by the Act, which has been developed through comprehensive consideration of research results and opinions presented by domestic and foreign game companies, including the following: (i) game companies that distribute and market popular games with a large number of domestic users should be included; (ii) game companies should be of a scale capable of bearing the costs associated with designating a domestic agent; and (iii) the criteria should align with those of other legislative examples related to the domestic agent designation system.
< Domestic Agent Designation System Overview>
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￭ (Target) A person who is engaged in game distributing business or game providing business with no domicile or place of business in the Republic of Korea, except those who enter into brokerage contracts with game products-related business entities and distribute game products or provide game use services using telecommunications networks.
￭ (Applicability) A person who meets any of the following criteria: ➊ A person whose sales for the preceding year (or during the previous fiscal year, in the case of a corporation) are or exceed KRW 1 trillion ➋ A person who distributes or provides game products with an average number of at least 100,000 domestic users for three months immediately before the end of the preceding year (If a single game product is provided in various forms and platforms such as PC and mobile, the number of users for all of the forms and platforms is added up). ➌ A person who has been recognized by the Minister of Culture, Sports and Tourism as needing to designate a domestic agent in cases where an incident or accident causing significant damage to game users has occurred or is likely to occur
￭ (Penalty) A fine of up to 20 million won will be imposed for violation of the designation requirement.
￭ (Management Measure) The Game Rating and Administration Committee will check whether a domestic agent has been designated. ※ For details, refer to the (Draft) Guide to the Domestic Agent Designation System under the Game Industry Promotion Act. |
To ensure that foreign game companies to be affected by this amendment have sufficient time to prepare themselves, the MCST will post the advance legislation notice approximately six months prior to its implementation date of October 23, 2025, and will distribute the Korean and English versions of the “(Draft) Guide to the Domestic Agent Designation System under the Game Industry Promotion Act” at the same time. After gathering additional opinions during the period of the advance legislation notice and reviewing relevant laws and regulations, the MCST will finalize and promulgate the amendment to the Decree, and foreign game companies subject to the designation requirement will be notified individually.
A policy official from the MCST stated, “We expect that the ‘Domestic Agent Designation System’ will contribute to establishing order in the distribution of domestic games, strengthening the protection of game users, and alleviating reverse discrimination against domestic game companies,” adding, “We will strive to ensure that foreign game companies subject to the designation requirement comply with the requirement to designate a domestic agent and that the system is operated effectively.”
Attachment: Excerpts of the relevant provisions of the Game Industry Promotion Act and the Draft Amendment to the Enforcement Decree of the Game Industry Promotion Act
Separate Attachment: 1. Advance Legislation Notice of Draft Amendment to Game Industry Promotion Act
Separate Attachment: 2. (Draft) Guide to the Domestic Agent Designation System under the Game Industry Promotion Act (Korean and English)