On January 29 2026, the National Assembly of the Republic of Korea passed the Amendment to the Act on the Promotion of Mutually Beneficial Cooperation between Large Enterprises and Small and Medium Enterprises (the Cooperation Act), effectively introducing the country’s first discovery-like system. It is due to take effect on February 20 2028.
What has increasingly become referred to as ‘K-Discovery’ is so far limited to cases of civil damages claims arising from the misappropriation of technical data between contracting and subcontracting companies, but discussions are under way to extend it to patent and unfair competition disputes in the near future. Beyond these technical boundaries, K-Discovery is poised to reshape the broader strategic landscape of Korean commercial litigation.
Background
Traditionally, infringed companies, and particularly SMEs, have faced a systemic disadvantage when attempting to protect their intellectual property. This structural problem stems from the fact that key evidence typically lies in the hands of the alleged infringers, leaving plaintiffs with an insurmountable barrier in collecting the proof necessary to establish their case.
While discovery systems have long been in place in countries such as the US, Germany, and Japan, Korea has historically lacked a comparable pretrial disclosure mechanism. Admittedly, the Civil Procedure Act provides for a document production order system, but this has proven notoriously ineffective to enforce in practice. This is because the requesting party was required to rely on speculative identification of the documents at the application stage, and the responding party could easily leverage multiple grounds to refuse to comply or challenge the scope of production.
Furthermore, even if a party fails to comply with a court order to produce, the means to compel such compliance or impose any substantive sanctions are practically non-existent. Accordingly, the urgent need to implement safeguards at the level of other technologically advanced nations to protect technology has drawn persistent outcries from the industry.
To tackle this, the idea of introducing a Korean-style discovery system had been discussed since 2020, to no avail. Finally, through persistent collaboration and communication among the legislature and relevant government agencies, the adoption of this system has at last been realised.
Key features of the K-Discovery system
To bridge the long-standing statutory gaps and give effect to these legislative overhauls, the amendment introduces the following three procedural mechanisms. Modelled after robust discovery tools in other jurisdictions, these targeted measures provide the practical leverage necessary to uncover critical facts before they are withheld or destroyed.
Evidentiary investigation conducted by court-appointed experts
In lawsuits for damages regarding the misappropriation of technical data, the court may – upon a party’s request – appoint experts to conduct necessary investigations.
Scope of authority – these investigative steps include visiting the parties’ offices or factories, questioning personnel, inspecting relevant data, operating equipment, and conducting necessary technical experiments. The court may subsequently admit the resulting findings into evidence.
Attorney presence – to guarantee due process, the investigation team must consist of one or more qualified individuals (such as expert examiners, patent attorneys, or experts designated by Supreme Court regulations), and must strictly include at least one licensed attorney.
Sanctions for non-compliance – if a responding party refuses, obstructs, or evades an expert investigation without a justifiable reason, the court may accept the moving party’s factual assertions regarding the evidence as true. Additionally, courts can impose severe administrative fines of up to KRW 100 million for corporations and KRW 50 million for individuals.
Attorney-led out-of-court depositions
In these actions, the court may order oral, out-of-court examinations between the parties upon either party’s request.
How it works – modelled closely after US depositions, these examinations are conducted outside a courtroom by the parties’ legal counsel and are recorded via audio or video. These recordings or transcripts may then be formally admitted into the trial record.
Sanctions for non-cooperation – if a party fails to appear or refuses to testify without a valid justification, the court may invoke adverse inferences, potentially deeming the opposing party’s factual assertions as proven.
Comprehensive evidence preservation and statutory protections
To prevent the destruction of evidence at an early stage, the court may issue data preservation orders against any party possessing or managing data necessary to prove violations or calculate damages, even before the formal filing of a lawsuit.
Severe criminal sanctions – in a major shift to establish a corporate litigation hold duty, the intentional destruction or alteration of data subject to a preservation order carries severe criminal penalties, including up to seven years’ imprisonment or fines of up to KRW 100 million.
Statutory attorney-client privilege (ACP) – ACP codified through the recent Amendment to the Attorney-at-Law Act has also explicitly been incorporated into the amended Cooperation Act. Confidential communications between a company and its legal counsel, in addition to documents prepared by an attorney for the dispute, are strictly excluded from expert investigations and redacted from examination records.
Administrative data access and pre-contract scope – to expedite litigation, the court is authorised to order the submission of administrative investigation data held by the Ministry of SMEs and Startups. Furthermore, the scope of legal protection is broadened by extending applicability to data misappropriations that occur before entering into formal subcontracting agreements.
Anticipated implications
The practical impact of this legislative transformation is expected to significantly reshape the strategic considerations for harmed corporations that have historically struggled to meet the strict burden of proof in technology theft disputes. Previously, the structural inability to access evidence held internally by allegedly infringing corporations left smaller enterprises with very little leverage. With the passing of this amendment, this historical imbalance is addressed through three primary shifts:
Facilitating effective remedies for damages – as it becomes substantially easier for harmed companies to secure and collect evidence to prove their damages, the likelihood of receiving equitable compensation and successful legal remedies will increase.
Deterring technology theft – with enhanced capabilities to secure critical evidence, it is reasonable to anticipate a strong deterrent effect against potential infringing corporations. This will, in effect, positively contribute to fostering a fair business ecosystem.
Expediting litigation – through expert-led evidentiary investigations, courts can clarify complex technical issues and expedite the resolution of lawsuits by identifying the core disputes in advance. This provides the distinct advantage of alleviating the judicial burden of protracted trials in technology-based lawsuits that require highly specialised technical judgments.
Takeaways on the new system
The newly introduced K-Discovery system is not just a copy of a single foreign model but an amalgamation of elements drawn from the US-style deposition system and the German-style court-appointed expert inspection procedure. By these legislative overhauls, the Republic of Korea is now on the verge of undergoing transformative restructuring in litigation practices, particularly regarding the preservation and disclosure of evidence.
As Korea approaches the February 20 2028 enforcement date, international corporations may find it beneficial to view the incoming framework not as a US-style discovery process but as a court-driven system centred on neutral expert fact-finding. Navigating this regime involves practical ambiguities for foreign entities, particularly regarding whether evidentiary preservation orders can reach overseas parent companies or data stored exclusively on foreign cloud infrastructure. Furthermore, because local court mandates may occasionally intersect with foreign data protection or export control laws, establishing early cross-border coordination between local and global legal teams is strongly encouraged.
To navigate these jurisdictional boundaries, foreign enterprises may consider integrating standard litigation holds, structured document retention policies, and clear data-segregation workflows to effectively leverage Korea’s newly codified statutory ACP.
