The recent amendment to the Korean Copyright Act (effective May 27, 2020) includes an interesting provision that exempts from infringement certain acts of incidental inclusion/reproduction of copyright materials in producing another visual or audio work. This provision appears to be directed to encouraging the use of devices that implement virtual reality and augmented reality technologies ("VR/AR devices").

Article 35-3 (Incidental Reproduction, etc.) of the Amendment provides that where a visual or auditory copyrighted work is included incidentally during the course of producing a photograph or a visual or sound recording, the incidental copyrighted work may be reproduced, distributed, publicly performed or publicly transmitted without liability, unless such use unfairly harms the interests of the copyright holder.

According to the legislative history of the Amendment, the provision was introduced as a result of advancements in VR/AR technologies and the resulting increase in the use of VR/AR devices that utilize such technologies, with the intention of encouraging the growth of the VR/AR industry by minimizing any liability for copyright infringement due to the incidental reproduction of third-party copyrighted works in the course of using VR/AR devices. While the Korean Copyright Act has long had a provision allowing certain fair uses of copyrighted works that are not contrary to the general method of use of the copyright and do not unfairly harm the copyright owner's interests (currently Article 35-5), this fair use provision has often been difficult to apply since it does not identify specific types of excluded uses in detail, and courts were generally required to review the totality of circumstances to determine whether to exempt an act as fair use (e.g., objective and nature of use, type and function of the copyrighted work, the portion of the work that was used and its importance, whether use of the work impacted the current or potential market value, etc.). The current Amendment clarifies the fair use provision by including Article 35-3 as a specific exemption, and thus seeks to promote the development of VR/AR technologies.

While it is somewhat unclear at present exactly what types of "incidental inclusions" of third-party copyrighted material are contemplated by the Amendment, the Korean government seems to want to reassure developers of VR/AR devices that they need not be overly concerned about whether the use of their devices may result in some incidental non-intended copying of third-party works. However, the Amendment as worded is not expressly limited to VR/AR devices, so it seems likely that other media industries may take advantage of these provisions as well. Further, since the Amendment retains the proviso that the third-party copyright owner's interests must not be "unfairly harmed," it remains to be determined by courts exactly what kinds of uses are "incidental" and what kinds of uses are "unfair."