World’s first: What to know about South Korea’s landmark AI framework

The AI Framework Act, passed in December 2024, is set to take effect on January 22. While companies will be given a one-year grace period, the law will formally establish the first unified national system for both regulating and promoting AI.

It is considered the world’s first because, despite the earlier adoption of the European Union’s AI Act, most of its rules will not apply until 2027. The US, meanwhile, remains deadlocked over federal AI legislation. 

The goal? To place South Korea among the world’s top three AI powers, alongside the US and China. By acting early, officials argue, Korea can help shape global norms on AI safety, transparency and ethics while rules elsewhere remain unsettled.

Innovation first

At the core of the law is an “innovation-first” approach. Companies are free to develop and deploy AI systems without prior government approval, a sharp contrast to more precautionary regulatory models. The government has also committed to supporting the sector through funding, infrastructure and workforce training.

However, freedom comes with new obligations. 

The law introduces the concept of “high-impact AI” — systems used in sensitive areas such as healthcare, energy, hiring and critical infrastructure. Firms developing these systems must carry out risk assessments, monitor performance and report safety measures to regulators.

One of the most closely watched provisions targets transparency. AI-generated images, videos and audio will need to be clearly labelled and watermarked, including with machine-readable markers designed to combat deepfakes and disinformation.

Despite its ambition, the framework has unsettled parts of the tech industry. 

Key definitions, including what qualifies as high-impact AI, remain vague. Detailed enforcement rules are still being drafted and will be issued through executive decrees led by the Ministry of Science and ICT.

Rattled market

While the law has yet to take effect, the uncertainty is already having an impact. 

Some companies have delayed product launches, while many startups say they are unsure how — or whether — the rules apply to their systems. Industry surveys suggest most firms have yet to begin formal compliance preparations.

Critics warn that moving first does not guarantee credibility. Without clearer guidance, they argue, the law risks confusing developers or becoming more symbolic than substantive.

The government acknowledges the rollout will be imperfect. Penalties of up to 30 million won ($20,800) will be suspended during the first year, a buffer officials say is meant to help companies adapt rather than punish them.

For now, South Korea is pressing ahead. Whether its early leap sets a global standard or exposes the risks of regulating too soon will become clearer once the law is tested in the real world.