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Paper Trail Exposed: 11 Giants, Including Microsoft and Temu, Named in Suspected Shell Company Scandal

Paper Trail Exposed: 11 Giants, Including Microsoft and Temu, Named in Suspected Shell Company Scandal

September 24, 2024 Catherine Williams - Chief Editor Tech

Global Companies Evading Responsibility for Protecting Domestic⁣ Users

Park Chung-kwon, a member⁤ of the People Power Party and the National ⁤Assembly Science, Technology, Information, Broadcasting and Communications Committee, has raised concerns that 11 global ⁤companies, including Microsoft and Temu, ​are evading their duty to protect domestic users‌ by designating entities suspected of being paper companies as agents.

According ⁣to the Korea Communications Commission, 26 out of‍ 39​ global companies with ⁤an obligation to designate agents have designated law⁢ firms or ‌separate corporations other than their domestic corporations as domestic agents. This has raised concerns about the ​effectiveness‌ of the domestic agent⁢ system, which was implemented in ‌2018 to protect the rights of domestic users and strengthen the responsibility⁢ of business operators.

Among the 11 companies, ​including Microsoft, Nike, Temu, and Zoom, ‍designated a separate legal entity called ⁤a “general agent”⁣ as⁣ their domestic agent. ‍However, an on-site ‌inspection by the Korea​ Communications Commission revealed that the legal entity had only three employees, and even ​among them, only‌ one was a full-time ⁤employee.

Furthermore, ‌it was confirmed ⁤that‌ the ‘general ⁢agent’ was handling complaints and ​providing relief for ‍damages related‌ to​ personal information of 11 companies in a formal manner,⁣ such as ⁣only sending emails ⁣via ARS. Despite receiving a recommendation for improvement from the Korea Communications Commission,‍ no corrective action⁢ has been taken​ to date.

Rep. Park expressed concerns‍ that‍ global⁣ companies may‍ appoint ⁣non-existent ​corporations as agents, and⁢ when problems arise, the parent companies may escape ​the ⁢law without ⁢any responsibility. He added that he will prepare a bill that⁤ would require domestic corporations to be designated as agents so that the system for personal information protection can​ be operated effectively.

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