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South Korea Unveils World's First Comprehensive AI Regulation Framework

Compliance and Regulatory Technology

Business Honor
22 January, 2026

Pioneering Legislation Balances Technological Innovation with Robust Safety and Ethical AI Governance.

South Korea is taking the lead globally in regulating AI technology, having passed a new comprehensive law (the "AI Basic Act") intended to provide a framework for innovation while also ensuring the safety and ethics associated with the technology. This new legislation is intended to help position South Korea as a leader in the development of a regulatory framework for the governance of AI technologies; it has been developed prior to similar European efforts and provides a contrast to the less-regulated approach being taken by the U.S. All high-impact applications of AI technology (nuclear safety, creation of water, transportation, health care, and financial services) will require companies utilizing these types of applications to create protections for users through the establishment of transparency and human oversight.

Some of the main components of the proposed AI legislation are; requiring informing consumers in advance about the use of any products or services that use AI technologies. Further, vendors of AI-based products will need to identify or label all AI content produced by their product, especially if it may appear similar or indistinguishable from human-generated content. Companies that fail to comply with these and many other requirements could be subject to severe penalties; taking into account the maximum fine for non-compliance would be approximately 30 million South Korean Won ($20,400).

Science Minister Bae Kyung-hoon, a previous AI research head at LG, has argued that this legislation is a major institutional pillar for South Korea's ambition to be ranked as a world-leading AI superpower and for the ministry to provide the industry with a strong regulatory structure to create safety and trust for AI. Unfortunately, the start-up community has voiced certain concerns regarding the draft AI laws; Lim Jung-wook from South Korea's Startup Alliance explained how many founders expressed their frustration with the uncertainty of regulations.