Client Problem

This is a case study of solving regulatory issues in South Korea a European customer. We have earlier completed similar projects in Korea, Thailand and Japan.

The customer is a major equipment manufacturer with a global reach and its own subsidiaries in many Asian countries. The customer has been in Korean market for decades, selling though a third-party distributor and supported by one local technical sales staff, the APAC sales team and HQ sales, legal and compliance units. The customer did not have any legal/compliance related expertise in the region.

The customer had recently entered into distributor agreement negotiations with a Korean conglomerate. Prior to approving signing the distributor contract, the customer’s compliance team flagged separate compliance issues pausing the signing. These issues could be harmful for the customers brand image if similar cases arise repeatedly.

The partner candidate had been penalised by the Korean Free Trade Commission (FTC) several times in the past, as well as local Occupational Health and Safety authorities.

Our Solution

We had two topics to clarify: firstly, why had the partner candidate been fined for several years for apparently breaking free trade regulations and secondly, was there a serious worker safety issue within the partner candidates’ operations? To solve the compliance related issues, we provided a full overview of the flagged companies Occupational Health and Safety, and Business ethics rules, manuals, processes, and activities while reflecting them against Korean as well as European standards. 

The major parts of this assignment included document review and in-depth discussions with the Korean company’s legal and compliance teams. We had several in-person meetings with the relevant teams. We reviewed the current activities of the relevant authorities (e.g. FTC) related to the Korean company. We reviewed all the above-mentioned documents as well as recent law changes, which partly caused some of the issue to be flagged. We completed site visits to several similar companies and facilities in Korea to compare the partner candidates’ operations broadly among Korean companies. And finally, we compiled a clear set of documents for the customers legal and compliance teams for final decision making. 

Some of the key skills we brought to the table were: 

• Communication skills in several key languages (including Korean and English)
• Communication skills on several key topics (including sales, strategy, and legal topics)
• Access to any level (from technical to owner) discussions relevant to the customer’s case.
• Strategical and practical thinking, focusing on developing successful sales channels.
• Cross-cultural understanding and inter-personal skills.

Understanding legal/compliance related issues and ability to draw parallels with European standards. 

Successful Result

We provided the customer a full overview of the partner candidates’ Occupational Health and Safety and Business ethics rules, manuals, processes, and activities while reflecting them against Korean as well as European standards.

We liaised with legal and compliance units of both organisations multiple times to pin down and clarify the key issues and finally gave a debriefing on all the findings to the customer’s legal unit.

Based on our work the customer’s compliance unit gave the final green light to proceed contracting with this new partner.