Cha & Kwon Law Offices provided a legal opinion on the potential applicability of Korean financial regulations to a referral business structure under which users are directed to an external trading platform through a partnership with an overseas financial service provider, and referral fees are received based on users’ trading activities.

The business structure involved introducing external trading services through an online platform and linking users to account registration or trading activities. Accordingly, the key issue was whether such introduction, partnership, and customer referral activities could be deemed investment solicitation or investment brokerage if conducted for Korean residents.

Cha & Kwon Law Offices reviewed whether the referral activities were limited to simple advertising or information provision, or whether they could be evaluated as activities that induce customers to trade specific financial products or involve participation in the trading process, based on the actual operating method and compensation structure.

In particular, we analyzed whether a compensation structure linked to trading performance could be viewed as creating an economic interest in inducing customer transactions, and how such a structure could be distinguished from a model based solely on voluntary use by Korean investors, in light of applicable laws and regulatory interpretations.

As a result, Cha & Kwon Law Offices advised that, if the current structure were operated as-is for Korean residents, the possibility of Korean financial regulations applying could not be easily excluded. We also explained that there may be limitations in maintaining the same structure merely by obtaining licenses or registrations. Accordingly, we proposed potential restructuring measures, including redesigning the model as a general information provision or advertising structure.

Cha & Kwon Law Offices provides practical legal advisory services for cross-border financial and investment-linked business models by assessing regulatory applicability based on the substance of the actual activities and proposing restructuring measures aligned with the client’s business objectives.