{"id":637,"date":"2026-02-27T23:08:41","date_gmt":"2026-02-27T23:08:41","guid":{"rendered":"https:\/\/atlaw.kr\/en-blog\/?p=637"},"modified":"2026-02-27T23:08:41","modified_gmt":"2026-02-27T23:08:41","slug":"store-background-music-copyright-performance-right-south-korea","status":"publish","type":"post","link":"https:\/\/atlaw.kr\/en-blog\/store-background-music-copyright-performance-right-south-korea\/","title":{"rendered":"Does Playing Background Music in Your Store Infringe Copyright in South Korea?"},"content":{"rendered":"<p><!-- ===== Schema Markup ===== --><\/p>\n<p><script type=\"application\/ld+json\">\n{\n    \"@context\": \"https:\/\/schema.org\",\n    \"@type\": \"Article\",\n    \"headline\": \"Does Playing Background Music in Your Store Infringe Copyright in South Korea?\",\n    \"description\": \"Playing background music through a commercial music service in South Korea may constitute copyright infringement. This article explains the 2025 Supreme Court ruling (2023Da290386) on performance rights and the 'commercially released phonogram' standard under Korean copyright law.\",\n    \"author\": {\n        \"@type\": \"Person\",\n        \"name\": \"Taejin Kim\",\n        \"jobTitle\": \"Attorney at Law\",\n        \"worksFor\": {\n            \"@type\": \"LegalService\",\n            \"name\": \"Atlas Legal\",\n            \"url\": \"https:\/\/atlaw.kr\",\n            \"address\": {\n                \"@type\": \"PostalAddress\",\n                \"addressLocality\": \"Incheon\",\n                \"addressRegion\": \"Songdo\"\n            }\n        }\n    },\n    \"publisher\": {\n        \"@type\": \"Organization\",\n        \"name\": \"Atlas Legal\",\n        \"url\": \"https:\/\/atlaw.kr\"\n    },\n    \"datePublished\": \"2026-02-28\",\n    \"dateModified\": \"2026-02-28\",\n    \"mainEntityOfPage\": {\n        \"@type\": \"WebPage\"\n    }\n}\n<\/script><\/p>\n<p><script type=\"application\/ld+json\">\n{\n    \"@context\": \"https:\/\/schema.org\",\n    \"@type\": \"FAQPage\",\n    \"mainEntity\": [\n        {\n            \"@type\": \"Question\",\n            \"name\": \"Is playing background music in a store copyright infringement in South Korea?\",\n            \"acceptedAnswer\": {\n                \"@type\": \"Answer\",\n                \"text\": \"It can be, even if no admission fee is charged. The key questions are: (1) whether the sound recording used qualifies as a 'commercially released phonogram' under Korean copyright law, and (2) whether the business falls under Article 11 of the Enforcement Decree of the Copyright Act, which mandates royalty payments for certain industries. According to the 2025 Supreme Court ruling, audio files delivered through a commercial background music service do not qualify as commercially released phonograms, meaning a separate performance rights license is required.\"\n            }\n        },\n        {\n            \"@type\": \"Question\",\n            \"name\": \"Does signing a contract with a background music service provider in South Korea cover performance rights?\",\n            \"acceptedAnswer\": {\n                \"@type\": \"Answer\",\n                \"text\": \"Not necessarily. A music service provider may hold licenses for reproduction and transmission rights, but performance rights \u2014 the right to publicly play music in a physical space \u2014 are a separate entitlement under Korean copyright law. Store operators must verify that their service agreement explicitly states that performance rights are included. If unclear, the store operator may still be liable for infringement.\"\n            }\n        },\n        {\n            \"@type\": \"Question\",\n            \"name\": \"What is the difference between a 'phonogram for sale' and a 'commercially released phonogram' in Korean copyright law?\",\n            \"acceptedAnswer\": {\n                \"@type\": \"Answer\",\n                \"text\": \"The 2016 amendment to the Korean Copyright Act replaced 'phonogram for sale' (\ud310\ub9e4\uc6a9 \uc74c\ubc18) with 'commercially released phonogram' (\uc0c1\uc5c5\uc6a9 \uc74c\ubc18), defined under Article 2(6-2) as a phonogram produced for the purpose of commercial distribution. The 2025 Supreme Court ruling, decided under the prior statute, held that the critical standard is whether the sound recording was fixed with the intent to sell it commercially \u2014 not whether the original source file was commercially available.\"\n            }\n        },\n        {\n            \"@type\": \"Question\",\n            \"name\": \"Which types of businesses in South Korea are required to pay music royalties under Article 11 of the Enforcement Decree?\",\n            \"acceptedAnswer\": {\n                \"@type\": \"Answer\",\n                \"text\": \"Article 11 of the Enforcement Decree of the Copyright Act lists several categories, including: coffee shops and non-alcoholic beverage establishments (Item 1(a)); beer-specialty restaurants and other drinking establishments (Item 1(b)); entertainment venues such as clubs and karaoke bars (Items 1(c) and (d)); horse racing, cycling and boat racing tracks (Item 2); certain sports facilities including golf courses, dance studios, ski resorts, aerobics studios and fitness centers (Item 3(b)); passenger aircraft, vessels and trains (Item 4); hotels, resort condominiums, casinos and theme parks under the Tourism Promotion Act (Item 5); and large-scale retail stores under the Distribution Industry Development Act with a net retail floor area of 3,000 m\u00b2 or more (Item 6).\"\n            }\n        },\n        {\n            \"@type\": \"Question\",\n            \"name\": \"How did the South Korea Supreme Court rule on background music services in its January 2025 decision?\",\n            \"acceptedAnswer\": {\n                \"@type\": \"Answer\",\n                \"text\": \"In its ruling dated January 23, 2025 (Supreme Court Case No. 2023Da290386), the Supreme Court of South Korea held that audio files delivered via webcasting by a commercial background music service are not 'phonograms for sale' under the prior Copyright Act. The Court reasoned that the relevant standard is the purpose at the time the sound recording was fixed \u2014 not the purpose of the original source file. Because the files were copied and encoded specifically for in-store streaming, not for retail sale, the performance rights exception did not apply and the store operator infringed the copyright holder's performance right.\"\n            }\n        },\n        {\n            \"@type\": \"Question\",\n            \"name\": \"What is the statute of limitations for copyright infringement claims in South Korea?\",\n            \"acceptedAnswer\": {\n                \"@type\": \"Answer\",\n                \"text\": \"Under Article 125 of the Copyright Act and Article 766 of the Civil Act, the statute of limitations for a copyright infringement damages claim is three years from the date the injured party became aware of the damage and the identity of the infringer, or ten years from the date of the infringing act, whichever expires first. Claims for unjust enrichment may be subject to different limitation periods. Given the 2016 amendment to the Copyright Act, the applicable statute also depends on when the alleged infringement occurred.\"\n            }\n        },\n        {\n            \"@type\": \"Question\",\n            \"name\": \"Can a store operator in South Korea play music using a personal streaming subscription or purchased CD without a separate performance license?\",\n            \"acceptedAnswer\": {\n                \"@type\": \"Answer\",\n                \"text\": \"Using a commercially released CD or a legitimately purchased digital file may satisfy the 'commercially released phonogram' requirement under the current Copyright Act. However, if the store falls under Article 11 of the Enforcement Decree, a separate royalty payment is still required regardless of the source. Store operators should verify both the nature of the sound recording and whether their business type triggers the Article 11 royalty obligation.\"\n            }\n        }\n    ]\n}\n<\/script><\/p>\n<p><script type=\"application\/ld+json\">\n{\n    \"@context\": \"https:\/\/schema.org\",\n    \"@type\": \"LocalBusiness\",\n    \"name\": \"Atlas Legal\",\n    \"image\": \"https:\/\/atlaw.kr\/logo.png\",\n    \"url\": \"https:\/\/atlaw.kr\",\n    \"telephone\": \"+82-32-864-8300\",\n    \"address\": {\n        \"@type\": \"PostalAddress\",\n        \"streetAddress\": \"323 Incheon Tower-daero, Suite B-2901 (Songdo-dong, Centroad)\",\n        \"addressLocality\": \"Incheon\",\n        \"addressRegion\": \"Yeonsu-gu, Incheon\",\n        \"addressCountry\": \"KR\"\n    },\n    \"priceRange\": \"$$\",\n    \"openingHoursSpecification\": {\n        \"@type\": \"OpeningHoursSpecification\",\n        \"dayOfWeek\": [\"Monday\",\"Tuesday\",\"Wednesday\",\"Thursday\",\"Friday\"],\n        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    margin: 0;\n        padding: 0;\n    }\n<\/style>\n<div class=\"content-container\">\n<p>    <!-- Table of Contents --><\/p>\n<div class=\"toc\">\n<h2>Table of Contents<\/h2>\n<ul>\n<li><a href=\"#section1\">1. What is a &#8220;performance right&#8221; under South Korean copyright law?<\/a><\/li>\n<li><a href=\"#section2\">2. When does the &#8220;commercially released phonogram&#8221; exception apply?<\/a><\/li>\n<li><a href=\"#section3\">3. What did the South Korea Supreme Court decide in January 2025?<\/a><\/li>\n<li><a href=\"#section4\">4. How did the 2016 amendment change the legal landscape?<\/a><\/li>\n<li><a href=\"#section5\">5. Which businesses must pay royalties under Article 11 of the Enforcement Decree?<\/a><\/li>\n<li><a href=\"#section6\">6. What should store operators and music service providers do now?<\/a><\/li>\n<li><a href=\"#section7\">7. FAQ<\/a><\/li>\n<\/ul><\/div>\n<p>    <!-- Story Hook --><\/p>\n<div class=\"story-hook\">\n<p><strong>A real scenario:<\/strong> A consumer electronics retailer in Incheon had used a licensed background music service for years, paying monthly fees and never charging customers to listen. Then came a demand letter from South Korea&#8217;s music copyright collecting society \u2014 claiming tens of millions of won in unpaid performance royalties. &#8220;We had a proper contract,&#8221; the operator said. &#8220;How can we still be infringing?&#8221; In January 2025, South Korea&#8217;s Supreme Court provided a clear and consequential answer.<\/p>\n<\/p><\/div>\n<p>    <!-- Direct Answer --><\/p>\n<div class=\"direct-answer\">\n        <strong>Key Answer:<\/strong> Under the Supreme Court of South Korea&#8217;s ruling dated January 23, 2025 (Case No. 2023Da290386), audio files delivered via webcasting by a commercial background music service do not constitute a &#8220;phonogram for sale&#8221; under the prior Copyright Act. Playing such files in a store infringes the copyright holder&#8217;s performance right, and a separate performance rights license is required.\n    <\/div>\n<p>    <!-- Story Development --><\/p>\n<div class=\"story-detail\">\n<h3>Why does a service contract not automatically cover performance rights?<\/h3>\n<p class=\"disclaimer\">\u203b The scenario described above is based on actual litigation and has been adapted for illustrative purposes. Client-identifying information has been protected.<\/p>\n<p>Under South Korean copyright law, the rights attached to a musical work are not a single bundle \u2014 they are a collection of distinct entitlements, including reproduction rights, transmission rights, distribution rights, and performance rights. A background music service provider may lawfully hold licenses to copy music onto its servers and stream it to subscribers. But the act of playing that music aloud through speakers in a physical space \u2014 so that customers can hear it \u2014 is a separate exercise of the copyright holder&#8217;s performance right. The 2025 Supreme Court ruling drew a sharp distinction between these two layers of rights, making clear that a transmission license does not carry performance rights along with it. For any business playing music in South Korea, both layers must be independently licensed.<\/p>\n<\/p><\/div>\n<p><\/p>\n<h2 id=\"section1\">1. What is a &#8220;performance right&#8221; under South Korean copyright law?<\/h2>\n<p>A performance right is the exclusive right of a copyright holder to publicly perform \u2014 or authorize the public performance of \u2014 a protected work. Playing music aloud to an audience is a textbook exercise of this right, and it requires authorization regardless of whether the audience pays to listen.<\/p>\n<h3>How does Korean copyright law define &#8220;performance&#8221;?<\/h3>\n<p>Article 2, Item 3 of the Korean Copyright Act defines &#8220;performance&#8221; broadly as the public presentation of a work through staging, playing, singing, recitation, reading, screening, playing back a sound recording, or any other method. The definition explicitly includes &#8220;playing back a sound recording,&#8221; which means that any time a store operator activates a speaker to play music for customers, that act constitutes a performance under Korean law.<\/p>\n<p>Article 17 of the Copyright Act provides that the author of a work has the exclusive right to publicly perform that work. Performing a protected work without authorization is an infringement of this right, subject to both civil liability (damages or disgorgement of unjust enrichment) and potential criminal penalties under Article 136.<\/p>\n<h3>Does it matter that customers are not charged to listen?<\/h3>\n<p>The absence of an admission fee does not eliminate the performance right. However, it is a relevant factor under Article 29(2) of the Copyright Act, which creates a conditional exception for certain non-commercial performances. The scope and limits of that exception are precisely what the 2025 Supreme Court ruling addressed.<\/p>\n<table>\n<tr>\n<th>Right<\/th>\n<th>Definition<\/th>\n<th>Relevance to Store Music<\/th>\n<\/tr>\n<tr>\n<td>Reproduction Right (Art. 16)<\/td>\n<td>Right to fix or copy the work onto a tangible medium<\/td>\n<td>Applies when the music service copies files onto its server<\/td>\n<\/tr>\n<tr>\n<td>Transmission Right (Art. 18)<\/td>\n<td>Right to transmit the work to the public on demand or in real time<\/td>\n<td>Applies when the service streams files to the store&#8217;s device<\/td>\n<\/tr>\n<tr>\n<td>Performance Right (Art. 17)<\/td>\n<td>Right to publicly present the work through playback or live rendering<\/td>\n<td>Applies when the store plays the music through speakers for customers<\/td>\n<\/tr>\n<\/table>\n<p><\/p>\n<h2 id=\"section2\">2. When does the &#8220;commercially released phonogram&#8221; exception apply?<\/h2>\n<p>Article 29(2) of the prior Copyright Act (before the September 2016 amendment) provided that playing back a &#8220;phonogram for sale&#8221; (\ud310\ub9e4\uc6a9 \uc74c\ubc18) did not infringe the performance right, provided that no admission fee was charged for the performance. The current law uses the term &#8220;commercially released phonogram&#8221; (\uc0c1\uc5c5\uc6a9 \uc74c\ubc18) with similar effect. Understanding the precise boundaries of this exception is central to the 2025 ruling.<\/p>\n<h3>The Supreme Court&#8217;s longstanding restrictive interpretation<\/h3>\n<p>Long before the 2025 ruling, South Korea&#8217;s Supreme Court had interpreted &#8220;phonogram for sale&#8221; narrowly. In a 2012 decision (Supreme Court, May 10, 2012, Case No. 2010Da87474 \u2014 the &#8220;Starbucks&#8221; case) and a 2016 decision (Supreme Court, August 24, 2016, Case No. 2016Da204653 \u2014 the &#8220;Himart&#8221; case), the Court held that a &#8220;phonogram for sale&#8221; means only a sound recording that was produced with the intent to sell it commercially to the general public.<\/p>\n<p>The rationale was rooted in the underlying policy of the exception. The law tolerates unrecompensed performance of commercially sold phonograms on the theory that in-store playback promotes awareness of the recording and can stimulate retail sales \u2014 thereby providing the copyright holder with an indirect benefit. Where the recording was never intended for retail sale, that indirect benefit does not arise, and the justification for the exception disappears.<\/p>\n<h3>The critical question: when is the &#8220;intent to sell&#8221; assessed?<\/h3>\n<p>The 2025 ruling answered this question definitively. The Court held that the relevant moment is not when the original master recording was created or commercially released, but when the specific copy of the phonogram actually used in the performance was fixed \u2014 that is, when it was reproduced. This point distinguished the 2025 case from the prior rulings, because the files at issue were not the commercially sold originals: they were re-encoded, encrypted copies created specifically for webcasting to store devices.<\/p>\n<table>\n<tr>\n<th>Factor<\/th>\n<th>Lower Court&#8217;s View<\/th>\n<th>Supreme Court&#8217;s View (2025)<\/th>\n<\/tr>\n<tr>\n<td>Which phonogram is assessed?<\/td>\n<td>The original source file (commercially released)<\/td>\n<td>The copy actually used in the performance<\/td>\n<\/tr>\n<tr>\n<td>When is intent assessed?<\/td>\n<td>At the time the original was published<\/td>\n<td>At the time the copy was fixed (reproduced)<\/td>\n<\/tr>\n<tr>\n<td>Does a copy of a commercial release become a &#8220;phonogram for sale&#8221;?<\/td>\n<td>Yes, if derived from a commercially released source<\/td>\n<td>No, if the copy was made for performance-delivery purposes<\/td>\n<\/tr>\n<tr>\n<td>Result for background music service files<\/td>\n<td>Exception applies; no infringement<\/td>\n<td>Exception does not apply; performance right infringed<\/td>\n<\/tr>\n<\/table>\n<p><\/p>\n<h2 id=\"section3\">3. What did the South Korea Supreme Court decide in January 2025?<\/h2>\n<p>The Supreme Court of South Korea issued its ruling on January 23, 2025, in Case No. 2023Da290386 (Claim for Return of Unjust Enrichment, etc.), reversing the Seoul High Court and remanding for further proceedings. The decision is the first Supreme Court ruling to directly address the copyright status of background music delivered via webcasting services, and it carries significant practical consequences for businesses operating in South Korea.<\/p>\n<h3>Background of the case<\/h3>\n<p>The plaintiff was the Korea Music Copyright Association (KMCA), the statutory collective management organization for musical works in South Korea. The defendant was a large consumer electronics company that supplied goods to a network of retail stores operating under its brand. The stores played background music provided by a third-party music service (the &#8220;Service Provider&#8221;) through a webcasting system.<\/p>\n<p>The KMCA had authorized the Service Provider to transmit music via webcasting for background music services \u2014 but this license covered only transmission rights, not performance rights. The Service Provider obtained commercially available digital audio files from a music distributor, stored them on its own servers, re-encoded and encrypted them so they could only play on authorized store devices, and streamed them to the stores&#8217; playback systems. Store managers then played the music through in-store speakers for customers, without charging any separate listening fee.<\/p>\n<h3>The three legal propositions established by the Court<\/h3>\n<p>The Supreme Court&#8217;s reasoning rests on three interlocking propositions, each of which has independent significance for future cases.<\/p>\n<p>First, the &#8220;phonogram for sale&#8221; exception under Article 29(2) must be interpreted strictly, because its effect is to extinguish the copyright holder&#8217;s performance right without any compensation. An expansive reading would unjustifiably harm copyright holders and undermine the incentive structure of copyright law.<\/p>\n<p>Second, the assessment of whether a phonogram qualifies as a &#8220;phonogram for sale&#8221; must be made by reference to the specific copy used in the performance \u2014 not the commercially sold original from which it was derived \u2014 and the intent must be assessed at the time that copy was fixed.<\/p>\n<p>Third, where a copy of a sound recording is made not for retail sale but for the purpose of delivering it to persons who will perform it (for example, by webcasting it to store devices for in-store playback), that copy is not a &#8220;phonogram for sale,&#8221; regardless of whether the source from which it was copied was commercially released.<\/p>\n<h3>Practical effect of the ruling<\/h3>\n<p>Because the audio files streamed to the defendant&#8217;s stores were fixed \u2014 that is, stored on the Service Provider&#8217;s servers \u2014 for the purpose of delivering them for in-store performance, not for retail sale, they were not &#8220;phonograms for sale.&#8221; The performance right exception therefore did not apply, and the store operators&#8217; playback of those files infringed the KMCA&#8217;s performance right. The Supreme Court reversed the High Court&#8217;s dismissal of the KMCA&#8217;s claims and remanded the case.<\/p>\n<p><\/p>\n<h2 id=\"section4\">4. How did the 2016 amendment change the legal landscape?<\/h2>\n<p>The 2025 Supreme Court ruling was decided under the prior Copyright Act \u2014 the version in force before the amendment that took effect on September 22, 2016. Understanding what changed, and what remained the same, is essential for assessing current legal exposure.<\/p>\n<h3>From &#8220;phonogram for sale&#8221; to &#8220;commercially released phonogram&#8221;<\/h3>\n<p>The 2016 amendment replaced &#8220;phonogram for sale&#8221; (\ud310\ub9e4\uc6a9 \uc74c\ubc18) with &#8220;commercially released phonogram&#8221; (\uc0c1\uc5c5\uc6a9 \uc74c\ubc18) in Article 29(2). Article 2(6-2) of the current Copyright Act defines a commercially released phonogram as &#8220;a phonogram produced for the purpose of commercial distribution.&#8221; The drafting history indicates that the amendment was intended to bring the statute into closer alignment with digital distribution realities.<\/p>\n<p>Whether the new term covers background music service files more broadly than the old term did is a question that no Supreme Court ruling has yet resolved under the current statute. Some commentators have argued that files delivered pursuant to a commercial services contract could satisfy the &#8220;commercial distribution&#8221; purpose requirement. However, given the Supreme Court&#8217;s consistent emphasis on the strict interpretation of performance right limitations, it would be premature to assume that background music service files are automatically exempt under the current law.<\/p>\n<h3>The expanded scope of the Enforcement Decree exception<\/h3>\n<p>The 2016 amendment also substantially expanded Article 11 of the Enforcement Decree of the Copyright Act. Under the current framework, even if a phonogram qualifies as a &#8220;commercially released phonogram,&#8221; businesses in the categories listed in Article 11 must still pay royalties to use it for in-store performance. This royalty obligation runs to collective management organizations such as the KMCA. The Enforcement Decree was most recently amended on August 26, 2025 and October 1, 2025.<\/p>\n<p><\/p>\n<h2 id=\"section5\">5. Which businesses must pay royalties under Article 11 of the Enforcement Decree?<\/h2>\n<p>Article 11 of the Enforcement Decree of the Copyright Act specifies the business categories for which in-store music performance requires royalty payment, even where a commercially released phonogram is used and no admission fee is charged. Businesses in these categories cannot rely on the Article 29(2) exception. The current version of Article 11 reflects amendments through October 1, 2025.<\/p>\n<h3>Item 1: Food and beverage establishments under the Food Sanitation Act<\/h3>\n<p>This is the category most frequently encountered in practice. The relevant establishments under Article 21(8) of the Enforcement Decree of the Food Sanitation Act are divided as follows.<\/p>\n<table>\n<tr>\n<th>Sub-item<\/th>\n<th>Type of Establishment<\/th>\n<th>Practical Examples<\/th>\n<\/tr>\n<tr>\n<td>Item 1(a)<\/td>\n<td>Snack bars (\ud734\uac8c\uc74c\uc2dd\uc810) classified as coffee shops or other non-alcoholic beverage businesses under the Korean Standard Industrial Classification (KSIC)<\/td>\n<td>All coffee chains and independent cafes, bubble tea shops, smoothie bars<\/td>\n<\/tr>\n<tr>\n<td>Item 1(b)<\/td>\n<td>General restaurants (\uc77c\ubc18\uc74c\uc2dd\uc810) classified as draft beer specialty restaurants or other drinking establishments under KSIC<\/td>\n<td>Beer bars, pub-style restaurants, izakayas<\/td>\n<\/tr>\n<tr>\n<td>Item 1(c)\u2013(d)<\/td>\n<td>Adult entertainment venues: dan-ran jujeom (\ub2e8\ub780\uc8fc\uc810) and entertainment bars (\uc720\ud765\uc8fc\uc810)<\/td>\n<td>Nightclubs, room salons, hostess bars<\/td>\n<\/tr>\n<tr>\n<td>Item 1(e) [\ub77c\ubaa9]<\/td>\n<td>Other food service establishments not covered above, where providing music or video content for customers to enjoy forms a principal part of the business<\/td>\n<td>Music listening bars, venues where music appreciation is a core part of the customer offering<\/td>\n<\/tr>\n<\/table>\n<p>Item 1(a) uses the KSIC classification, not the name of the establishment. A coffee-serving business classified under a different KSIC code (for example, a bakery or fast-food restaurant that incidentally serves coffee) may fall outside Item 1(a). Conversely, general restaurants serving ordinary meals \u2014 Korean, Chinese, and other cuisines \u2014 that are not classified as beer specialty restaurants or drinking establishments are generally not covered by Item 1(b). Item 1(e) requires that music appreciation form a &#8220;principal part&#8221; of the business; merely playing background music does not satisfy this threshold.<\/p>\n<h3>Items 2 through 5: Sports, transport, and tourism venues<\/h3>\n<table>\n<tr>\n<th>Item<\/th>\n<th>Category<\/th>\n<th>Key Notes<\/th>\n<\/tr>\n<tr>\n<td>Item 2<\/td>\n<td>Horse racing tracks (under the Korea Racing Authority Act), cycling tracks and boat racing tracks (under the Cycling and Boat Racing Act)<\/td>\n<td>Applies only to facilities designated under the relevant statutes<\/td>\n<\/tr>\n<tr>\n<td>Item 3(a)<\/td>\n<td>Professional sports facilities designated by Ministry of Culture, Sports and Tourism ordinance under the Sports Facilities Act<\/td>\n<td>Covers major professional stadiums; specific facilities listed in ministry ordinance<\/td>\n<\/tr>\n<tr>\n<td>Item 3(b)<\/td>\n<td>Golf courses, dance academies, dance halls, ski resorts, aerobics studios, and fitness centers (\uccb4\ub825\ub2e8\ub828\uc7a5) under Annex 1 of the Enforcement Decree of the Sports Facilities Act<\/td>\n<td>Health clubs, gyms and fitness centers are included as &#8220;fitness centers&#8221;<\/td>\n<\/tr>\n<tr>\n<td>Item 4<\/td>\n<td>Passenger aircraft (Aviation Business Act), passenger vessels (Maritime Transport Act), and passenger trains (Railway Business Act)<\/td>\n<td>Applies only to commercial passenger transport services<\/td>\n<\/tr>\n<tr>\n<td>Item 5<\/td>\n<td>Hotels, resort condominiums, casinos, and theme parks under the Tourism Promotion Act<\/td>\n<td>Applies to Tourism Promotion Act-registered facilities; ordinary motels and guesthouses may not qualify<\/td>\n<\/tr>\n<\/table>\n<h3>Item 6: Large-scale retail stores under the Distribution Industry Development Act<\/h3>\n<p>Item 6 covers large-scale retail stores listed in the Annex to the Distribution Industry Development Act, with traditional markets excluded. The Annex defines six categories of large-scale retail store. All six share a common threshold: the aggregate retail floor area, excluding areas designated for service provision (\uc6a9\uc5ed\uc758 \uc81c\uacf5\uc7a5\uc18c), must be at least 3,000 m\u00b2.<\/p>\n<table>\n<tr>\n<th>Type<\/th>\n<th>Statutory Definition<\/th>\n<th>Examples<\/th>\n<\/tr>\n<tr>\n<td>Large-format general merchandise store (\ub300\ud615\ub9c8\ud2b8)<\/td>\n<td>Aggregate net retail floor area \u2265 3,000 m\u00b2; sells food, electronics, and household goods primarily on a self-service basis<\/td>\n<td>E-Mart, Lotte Mart, HomePlus<\/td>\n<\/tr>\n<tr>\n<td>Specialty store (\uc804\ubb38\uc810)<\/td>\n<td>Aggregate net retail floor area \u2265 3,000 m\u00b2; specializes in a particular product category such as apparel, electronics, or home goods<\/td>\n<td>Large-format electronics stores, major furniture chains, large apparel chains<\/td>\n<\/tr>\n<tr>\n<td>Department store (\ubc31\ud654\uc810)<\/td>\n<td>Aggregate net retail floor area \u2265 3,000 m\u00b2; modern retail and customer amenity facilities; at least 30% directly operated by the owner<\/td>\n<td>Lotte, Shinsegae, Hyundai department stores<\/td>\n<\/tr>\n<tr>\n<td>Shopping center (\uc1fc\ud551\uc13c\ud130)<\/td>\n<td>Aggregate net retail floor area \u2265 3,000 m\u00b2; multiple retail stores and amenities integrated in a single complex, operated on a direct or lease basis<\/td>\n<td>IParc Mall, certain Starfield locations<\/td>\n<\/tr>\n<tr>\n<td>Complex shopping mall (\ubcf5\ud569\uc1fc\ud551\ubab0)<\/td>\n<td>Aggregate net retail floor area \u2265 3,000 m\u00b2; integrates shopping, entertainment and business functions, serves as a cultural\/tourism destination, developed and managed by a single entity<\/td>\n<td>Starfield Hanam, IFC Mall, COEX Mall<\/td>\n<\/tr>\n<tr>\n<td>Other large-scale retail stores<\/td>\n<td>(a) Aggregate net retail floor area \u2265 3,000 m\u00b2; or (b) Total floor area (including service areas) \u2265 3,000 m\u00b2 and net retail floor area \u2265 50% of total (adjustable by up to 10% by local government authority)<\/td>\n<td>Large retail clusters not fitting the categories above<\/td>\n<\/tr>\n<\/table>\n<p>A key practical point: the &#8220;specialty store&#8221; category covers retailers specializing in electronics, apparel, or home goods with an aggregate net retail floor area of at least 3,000 m\u00b2. An individual franchise outlet of a consumer electronics brand \u2014 such as those operated by the defendant in the 2025 case \u2014 will generally not meet this threshold on its own. The analysis must focus on whether the relevant group of stores is registered and operated as a large-scale retail store under the Distribution Industry Development Act, and whether the aggregate floor area threshold is satisfied.<\/p>\n<p>For the &#8220;other large-scale retail stores&#8221; category (b), even if the total floor area including service areas reaches 3,000 m\u00b2, the facility is not covered unless at least 50% of the total floor area is devoted to retail sales. This ratio may be adjusted by up to 10 percentage points by the competent local government authority.<\/p>\n<h3>Items 7 and 8: Audiovisual works in accommodations and public facilities<\/h3>\n<table>\n<tr>\n<th>Item<\/th>\n<th>Category<\/th>\n<th>Scope<\/th>\n<\/tr>\n<tr>\n<td>Item 7<\/td>\n<td>Lodging establishments and bathhouses under the Public Health Control Act, equipped with video viewing facilities<\/td>\n<td>Applies to audiovisual works only; covers motels, inns, and saunas with in-room video systems<\/td>\n<\/tr>\n<tr>\n<td>Item 8<\/td>\n<td>Public facilities: government offices, performance halls, museums, libraries, local cultural centers, social welfare centers, women&#8217;s centers, youth training centers, and district community centers<\/td>\n<td>Applies to audiovisual works only; limited to works released within the preceding 6 months<\/td>\n<\/tr>\n<\/table>\n<p>Items 7 and 8 apply only to audiovisual works (such as films and television programs), not to music. Item 8 is further limited to works released within the six months immediately preceding the performance \u2014 works more than six months old fall outside its scope even in covered public facilities.<\/p>\n<h3>The critical two-step analysis<\/h3>\n<p>It is important to understand the relationship between Article 29(2) and Article 11 of the Enforcement Decree. They operate at different levels of the analysis. Article 29(2) asks: is the phonogram a &#8220;commercially released phonogram,&#8221; and is no admission fee charged? If the phonogram is not commercially released \u2014 as the Supreme Court held for background music service files \u2014 the inquiry ends there, and infringement is established without reaching Article 11. Article 11 only becomes relevant when the phonogram is commercially released: it then determines whether a royalty must still be paid despite the general exception. For background music service files under the 2025 ruling, Article 11 is therefore not the operative provision \u2014 the infringement arises one step earlier.<\/p>\n<p><\/p>\n<h2 id=\"section6\">6. What should store operators and music service providers do now?<\/h2>\n<p>The 2025 Supreme Court ruling, taken together with the current statutory framework, points to a clear set of practical priorities for businesses operating stores in South Korea where music is played.<\/p>\n<h3>Three-step compliance check for store operators<\/h3>\n<p><strong>Step 1: Determine whether your business falls under Article 11 of the Enforcement Decree.<\/strong> Review the categories described in Section 5 above. Cafes, drinking establishments, fitness centers, large retail stores, hotels, and similar venues are likely covered. If your business is covered, you are required to pay royalties to the relevant collective management organization for in-store music use, regardless of the source of the music.<\/p>\n<p><strong>Step 2: Review your background music service agreement.<\/strong> Check whether the contract with your service provider explicitly states that performance rights are included in the license granted. A contract that covers only &#8220;music service&#8221; or &#8220;audio streaming&#8221; without mentioning performance rights may leave you exposed. Request written confirmation from your service provider that it has obtained a performance rights license from the KMCA or other relevant collecting society on your behalf.<\/p>\n<p><strong>Step 3: Obtain a direct performance rights license if necessary.<\/strong> If your service provider cannot confirm that performance rights are covered, contact the Korea Music Copyright Association (KMCA) or the Korea Music Performers&#8217; Association (KMPA) directly to obtain the necessary license and pay the applicable royalties. The KMCA administers performance royalties for musical compositions; the KMPA administers neighboring rights for performers and phonogram producers.<\/p>\n<h3>Obligations for background music service providers<\/h3>\n<p>The 2025 ruling imposes the greatest direct legal risk on background music service providers. Service providers should take the following steps: confirm that performance rights licenses have been obtained from relevant collecting societies; amend customer contracts to clearly state which rights are and are not covered; and ensure that royalty payments are properly structured to reflect performance rights obligations. Failure to address these issues exposes both the service provider and its client store operators to infringement liability.<\/p>\n<h3>If you have already received a royalty demand<\/h3>\n<p>Businesses that have received a demand for unpaid performance royalties from the KMCA or another collecting society should not simply accept or reject the demand without careful analysis. The applicable statute depends on when the alleged infringement occurred \u2014 before or after the September 2016 amendment. The calculation method for damages or unjust enrichment also warrants scrutiny. In prior similar cases handled by practitioners in this field, demands have sometimes included amounts for periods already barred by the statute of limitations, or have applied royalty rates that are not accurately calibrated to the specific circumstances. A thorough legal review before responding is strongly advisable.<\/p>\n<p>    <!-- FAQ Section --><br \/>\n    <\/p>\n<h2 id=\"section7\">7. FAQ<\/h2>\n<div class=\"faq-section\">\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q1. Is playing background music in a store copyright infringement in South Korea?<\/div>\n<div class=\"faq-answer\">A. It can be, even if no admission fee is charged. The key questions are whether the sound recording qualifies as a &#8220;commercially released phonogram&#8221; and whether the business falls under Article 11 of the Enforcement Decree of the Copyright Act. Under the 2025 Supreme Court ruling, audio files from a background music service do not qualify as commercially released phonograms, meaning a separate performance rights license is required.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q2. Does signing a contract with a background music service provider in South Korea cover performance rights?<\/div>\n<div class=\"faq-answer\">A. Not necessarily. A service provider may hold transmission and reproduction licenses without holding performance rights. Store operators should verify that their contract explicitly includes performance rights, and should request confirmation that the provider has obtained the necessary license from the Korea Music Copyright Association (KMCA) or other relevant collecting society.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q3. What is the difference between a &#8220;phonogram for sale&#8221; and a &#8220;commercially released phonogram&#8221; in Korean copyright law?<\/div>\n<div class=\"faq-answer\">A. The 2016 amendment to the Korean Copyright Act replaced &#8220;phonogram for sale&#8221; (\ud310\ub9e4\uc6a9 \uc74c\ubc18) with &#8220;commercially released phonogram&#8221; (\uc0c1\uc5c5\uc6a9 \uc74c\ubc18), defined under Article 2(6-2) as a phonogram produced for the purpose of commercial distribution. The 2025 Supreme Court ruling held that the critical standard is whether the specific copy used was fixed with the intent of commercial sale \u2014 not whether the original source was commercially available.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q4. Which types of businesses in South Korea are required to pay music royalties under Article 11 of the Enforcement Decree?<\/div>\n<div class=\"faq-answer\">A. The categories include: coffee shops and non-alcoholic beverage establishments; beer-specialty restaurants and drinking establishments; entertainment venues; horse racing, cycling and boat racing tracks; certain sports facilities including golf courses, dance studios, ski resorts, aerobics studios and fitness centers; passenger aircraft, vessels and trains; hotels, resort condominiums, casinos and theme parks under the Tourism Promotion Act; and large-scale retail stores under the Distribution Industry Development Act with a net retail floor area of 3,000 m\u00b2 or more.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q5. How did the South Korea Supreme Court rule on background music services in its January 2025 decision?<\/div>\n<div class=\"faq-answer\">A. In Case No. 2023Da290386 (January 23, 2025), the Supreme Court held that audio files delivered via webcasting by a commercial background music service are not &#8220;phonograms for sale&#8221; under the prior Copyright Act. The critical factor is the purpose at the time the copy was fixed: because the service provider copied and encoded the files specifically for in-store streaming rather than for retail sale, the performance rights exception did not apply and the store operator infringed the copyright holder&#8217;s performance right.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q6. What is the statute of limitations for copyright infringement claims in South Korea?<\/div>\n<div class=\"faq-answer\">A. Under Article 125 of the Copyright Act and Article 766 of the Civil Act, the limitation period for a damages claim is three years from the date the injured party became aware of both the damage and the identity of the infringer, or ten years from the date of the infringing act, whichever expires first. Given the 2016 amendment to the Copyright Act, the applicable statute also depends on when the alleged infringement occurred.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q7. Can a store in South Korea play music using a personal streaming subscription or purchased CD without a separate performance license?<\/div>\n<div class=\"faq-answer\">A. Using a commercially released CD or a legitimately purchased digital file may satisfy the &#8220;commercially released phonogram&#8221; requirement. However, if the store falls under Article 11 of the Enforcement Decree, a separate royalty payment is still required. Store operators should confirm both the nature of the recording being used and whether their business type is subject to the Article 11 royalty obligation.<\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>The January 2025 Supreme Court ruling represents a significant development in South Korean copyright law as it applies to businesses using music in physical spaces. Based on analysis of the decision and experience handling related disputes, store operators and retail businesses currently using background music services should treat a review of their service agreements and royalty compliance status as a priority. Unaddressed exposure in this area can result in substantial claims for unpaid royalties or unjust enrichment spanning multiple years.<\/p>\n<p class=\"disclaimer\" style=\"margin: 20px 0;\">\u203b The legal information in this article is provided for general informational purposes only. The applicable analysis may differ based on the specific facts of each case. For advice regarding a particular matter, please consult a qualified attorney.<\/p>\n<p>    <!-- Author Box --><\/p>\n<div class=\"author-box\">\n<h3>About the Author<\/h3>\n<div class=\"author-name\">Taejin Kim | Managing Attorney<\/div>\n<div class=\"author-info\">Corporate Advisory, Corporate Disputes &amp; Business Criminal Defense<\/div>\n<div class=\"author-info\">Former Prosecutor | Judicial Research and Training Institute, 33rd Class<\/div>\n<div class=\"author-info\">LL.B. &amp; LL.M. in Criminal Law, Korea University | LL.M., University of California, Davis<\/div>\n<div class=\"author-info\">Atlas Legal | Songdo, Incheon<\/div>\n<p>        <a href=\"https:\/\/atlaw.kr\" target=\"_blank\" rel=\"noopener noreferrer\">Visit Atlas Legal Website<\/a>\n    <\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Table of Contents 1. What is a &#8220;performance right&#8221; under South Korean copyright law? 2. When does the &#8220;commercially released phonogram&#8221; exception apply? 3. What did the South Korea Supreme Court decide in January 2025? 4. How did the 2016 amendment change the legal landscape? 5. Which businesses must pay royalties under Article 11 of&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_kadence_starter_templates_imported_post":false,"_kad_post_transparent":"default","_kad_post_title":"default","_kad_post_layout":"default","_kad_post_sidebar_id":"","_kad_post_content_style":"default","_kad_post_vertical_padding":"default","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"_kad_post_classname":"","footnotes":""},"categories":[218,15,228],"tags":[470,469,471,468,467],"class_list":["post-637","post","type-post","status-publish","format-standard","hentry","category-corporate-counseling","category-corporate","category-intellectual-property","tag-background-music-service","tag-commercially-released-phonogram","tag-enforcement-decree-article-11","tag-performance-right-infringement","tag-south-korea-copyright-law"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Does Playing Background Music in Your Store Infringe Copyright in South Korea? | Atlas Legal<\/title>\n<meta name=\"description\" content=\"Playing background music via a commercial service in South Korea may infringe performance rights. 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