Foreign Game Companies Required to Designate Local Representatives
Yaera JEON Partner
Hyeon Il KIM Attorney
1. Key Developments
With the local representative designation requirement under Article 31-2 of the Game Industry Promotion Act (added October 22, 2024) set to take effect on October 23, 2025 following a one-year grace period, the State Council’s approval of the enforcement decree on October 14, 2025 has finalized the specific thresholds and criteria that will determine which foreign game companies must comply.1 The finalized requirements differ significantly from earlier proposals and warrant careful review by potentially affected companies.
The approved decree reflects substantial revisions from the initial April 2025 proposal, which would have applied only to foreign game companies with monthly active Korean users exceeding 100,000. Following industry feedback, the Ministry’s July 2025 re-announcement lowered the threshold to capture mid-sized foreign gaming companies, and this revised standard has now been adopted in the final enforcement decree, addressing concerns about regulatory gaps and unfair competition between domestic and foreign operators.
2. Scope of Application
The enforcement decree establishes specific criteria for the local representative designation requirement. The regulation applies to game distributors and game providers without a Korean address or business location. According to the Ministry’s guidance distributed with the enforcement decree, foreign entities are considered to be operating in Korea when they provide Korean-language support, accept Korean payment methods, or establish domestic branches for game-related activities. Open online marketplace platforms that merely facilitate transactions between sellers and buyers are excluded from these requirements.
The designation requirement applies to entities meeting any of the following thresholds: (i) annual global revenue exceeding KRW 1 trillion in the previous year; (ii) mobile games installed on domestically sold devices with average daily downloads of 1,000 or more (calculated as total annual downloads divided by 365 days, aggregated across all app markets); or (iii) cases where incidents that significantly disrupt the game distribution order have occurred or are likely to occur, and the entity has been required to report by the Minister of Culture, Sports and Tourism under Article 31-2 of the Act.
3. Local Representative Requirements and Compliance Obligations
Local representatives must be natural persons or legal entities with Korean addresses or business locations. While natural persons need not be Korean nationals, they must demonstrate Korean language proficiency sufficient for effective communication with users and authorities. Companies may appoint multiple representatives, and one representative may serve multiple foreign companies.
The designation must be formalized in writing, with the representative’s information included in the company’s Terms of Service pursuant to the Act on the Regulation of Terms and Conditions. Companies must also immediately notify the Game Rating and Administration Committee upon designation. Once appointed, local representatives assume statutory obligations under Articles 31-2 and 33 of the Game Industry Promotion Act, including submitting reports on game distribution order and gambling prevention, and ensuring disclosure of game ratings, producer information, and probability-based item drop rates on game interfaces, websites, and advertising materials.
Non-compliance triggers administrative fines of up to KRW 20 million per violation. Since the designation obligation renews annually based on revenue or user metrics, companies face recurring penalties for continued non-compliance.
4. Integrated Compliance Approach Needed
As foreign companies prepare for the imminent implementation, it is crucial to recognize that this local representative requirement does not exist in isolation. Korea has established a multi-layered framework of local representative obligations across different regulatory domains. The Personal Information Protection Act already imposes similar requirements, and the Framework Act on Artificial Intelligence will introduce its own mandate when it takes effect in January 2026.
While all three laws converge on the KRW 1 trillion global revenue threshold,2 their specific requirements diverge in important ways. Most notably, the Personal Information Protection Act mandates that Korean subsidiaries must serve as local representatives when they exist, whereas the Game Industry Promotion Act currently imposes no such requirement—though the Ministry has signaled this may change through planned supplementary legislation. Additionally, each law encompasses different operational thresholds: the Game Industry Promotion Act focuses on daily download metrics (1,000+), the Personal Information Protection Act considers data subject volumes, and the AI Act applies to those with AI service revenue exceeding KRW 10 billion or average daily users exceeding 1 million.
Given these overlapping yet distinct requirements, foreign gaming companies—particularly those developing AI-integrated games or processing significant user data—must carefully map out their compliance obligations across all applicable frameworks. Establishing a comprehensive local representation structure that can adapt to these varied requirements will be essential for maintaining consistent compliance while avoiding redundant administrative burdens in Korea’s increasingly complex regulatory environment.
- Ministry of Culture, Sports and Tourism, “해외 게임사의 국내대리인 지정 의무화” [Foreign Game Companies’ Local Representative Designation Becomes Mandatory] Press Release (Oct. 14, 2025).
- Framework Act on Artificial Intelligence, Article 36 and Enforcement Decree Article 28; Personal Information Protection Act, Article 31-2 and Enforcement Decree Article 32-3.
