On February 27, 2025, South Korea’s Ministry of Environment (MOE) and Ministry of Justice (MOJ) jointly announced at a press conference that a compliance grace period program under the Act on the Registration and Evaluation of Chemicals (K-REACH) will take effect starting February 28. The policy aims to provide companies that have failed to fulfill chemical management obligations with a rectification window, allowing them to avoid criminal and financial penalties through voluntary reporting.
Under the policy, companies that have neglected duties such as chemical registration, notification changes, or pre-notification may be exempted from penalties—including up to 5 years imprisonment, fines of 100 million KRW, and additional penalties of 5% of annual revenue—if they voluntarily notify and rectify violations within 8 months (by October 27).
Policy Background: Regulatory Challenges under Strict Rules
Under K-REACH, all companies manufacturing or importing chemicals in South Korea must complete substance registration, submit safety data, and notification changes. Violators face criminal liability (up to 5 years imprisonment), fixed fines (100 million KRW), and dynamic penalties (5% of total sales). However, surveys reveal frequent non-compliance due to internal management oversights or insufficient awareness of regulations.
Key Provisions of the Grace Period Policy
The program covers two categories:
- Non-compliant entities: Companies that produced/imported chemicals before February 27, 2025, but failed to complete registration, notification changes, or pre-notification.
- Companies with inaccurate information: Companies with discrepancies between registered/notified data and actual production/import activities.
Applicants must submit the following via the Chemical Information Processing System (kreach.me.go.kr):
- Explanation of violations;
- Production/import records;
- Standardized notification forms.
Categorized Review Process
The MOE clarified the review framework:
Chemical registration/changes: Evaluated directly by the Korea Chemicals Management Agency (KCMA).
Pre-notification items: Technically reviewed by the Korea Environment Corporation (KECO).
The MOE emphasized that companies already under administrative investigation may receive reduced penalties or case closures based on voluntary notification.
Post-Grace Period Regulatory Intensification
After the voluntary notification window closes, the MOE will collaborate with local authorities to conduct high-intensity on-site inspections targeting non-compliant chemical enterprises. Violations uncovered post-deadline will be strictly penalized under original K-REACH rules.
