(C) The Spy Hunter
 
SEOUL – A long-standing aspiration of South Korea’s industrial sector, the amendment to the Espionage Act (Article 98 of the Criminal Code), has cleared a critical hurdle. Amidst a growing number of attempts to leak critical national strategic technologies—especially in sectors like semiconductors—to foreign entities, the current law’s weak penalties have drawn continuous criticism. Recognizing this urgent need, rival political parties have put aside their differences to pass the amendment through the National Assembly’s Legislation and Judiciary Committee (LJC). This significant legislative change, which introduces penalties of up to the death sentence, marks the first modification to the article in 72 years, putting the nation one step closer to strengthening its legal bulwark against technological theft.

Closing a 72-Year Legal Loophole

The existing Espionage Act, originally drafted in 1953 by emulating Japan’s wartime criminal code, prescribes the death penalty, life imprisonment, or a minimum of seven years in prison for espionage conducted for an "enemy state." Historically, "enemy state" has been narrowly interpreted to mean North Korea. This narrow definition created a critical loophole: individuals leaking national secrets to foreign countries other than North Korea could not be prosecuted under the Espionage Act.

The newly passed amendment directly addresses this deficiency by establishing Article 98, Clause 2. This clause explicitly defines the scope of espionage to include activities conducted for a "foreign state or an equivalent organization."

The amended law stipulates that any person who, under the direction, instigation, or communication of intent from a foreign state or equivalent organization, searches, collects, discloses, transmits, brokers, or aids in the leaking of national secrets will face a minimum of three years of imprisonment.

A source from the LJC noted that once the amendment is enacted, it will serve as a legal basis not only for prosecuting internal leaks but also for penalizing cyber hacking and other intelligence-gathering activities, significantly bolstering national security.

Industry Cheers as Penalties Skyrocket

The industrial sector has largely welcomed the legal reform. The amendment provides a powerful legal tool to impose severe penalties on industrial espionage—the theft of industrial and scientific technology for the benefit of foreign competitors like those in China and Japan.

Previously, industrial spies were primarily prosecuted under the Act on the Protection of Industrial Technology (APIT). While the APIT allows for a maximum sentence of 15 years for technology leaks abroad, legal professionals noted that courts frequently imposed lighter sentences, often resulting in one to two years of imprisonment or probation. This perceived leniency failed to deter sophisticated theft rings.

Foreign firms have aggressively targeted South Korean technology to narrow the gap in key advanced industries. Data submitted by the Ministry of Trade, Industry and Energy (MOTIE) to the National Assembly reveals the scale of the problem: between 2020 and June of this year, 33 cases of National Core Technology and 110 cases of general industrial technology were leaked overseas. The estimated financial damage resulting from these incidents has reached a staggering 23.27 trillion Korean won (approximately $17.8 billion USD).

A Missed Opportunity for Economic Security

Despite the significant progress, some voices within the business community express disappointment. The amendment limits the application of the new espionage offense strictly to cases involving the leaking of "national secrets."

One business insider commented, "It is immensely meaningful that the defense industry and national high-tech areas will now receive protection. However, companies hoped for the scope of espionage to be expanded to include economic security areas, such as industrial secrets, but this part was not reflected in the final amendment."

The legislative success is nevertheless viewed as a rare moment of bipartisan cooperation in the National Assembly. Lawmakers from both the ruling People Power Party (Yoon Sang-hyun, Na Kyung-won) and the main opposition Democratic Party of Korea (Park Sun-won, a former National Intelligence Service official) sponsored the related bills, highlighting the consensus on the urgency of protecting the nation's technological assets. The final passage of the bill awaits a plenary session later this month.