Chyung Eun-ju
When DeepSeek burst into the worldwide AI scene earlier this yr, it shook up not simply the tech world, but in addition the worldwide market. Nevertheless, simply because it has been a lurking situation with different AI applied sciences, it sparked considerations over information privateness, safety and regulatory compliance. Developed by the Chinese language startup based by Liang Wenfeng, DeepSeek’s chatbot gained, virtually in a single day, an enormous worldwide consumer base, rising to the highest of app shops and drawing comparisons to OpenAI’s ChatGPT.
Its sudden rise, nonetheless, additionally got here with a value, as numerous nations held regulatory considerations over this new platform. Korea has not too long ago fallen into one of many nations which have put DeepSeek underneath regulatory scrutiny, suspending new downloads as a result of considerations over the way it processes consumer information.
We consider that DeepSeek’s success and broad public acceptance had been pushed by its capability to ship high-performance AI at a price considerably decrease than its Western rivals. However, simply as has occurred for its rivals, questions on how DeepSeek handles consumer information have emerged and gained public consideration, as customers have gotten increasingly acutely aware of the significance of knowledge safety for preserving their privateness.
Current stories recommended that DeepSeek shares information with ByteDance, the Chinese language tech big behind TikTok, elevating considerations of attainable information transfers to Chinese language state-linked entities. These revelations, coupled with China’s information safety legal guidelines, have led regulators to query whether or not DeepSeek can adequately defend consumer privateness. These considerations have led the Private Info Safety Fee (PIPC) of Korea to determine on the momentary elimination of DeepSeek from app shops inside the nation till its information practices might be examined additional. Whereas present customers can nonetheless entry the AI mannequin, new downloads have been blocked. The choice mirrors actions taken by a number of different nations, together with Italy, Australia and Taiwan, all of which have restricted or banned DeepSeek at some degree.
A number of nations have imposed restrictions on DeepSeek as a result of considerations over information safety and transparency. Italy’s Knowledge Safety Authority (Garante) restricted DeepSeek’s processing of consumer information, citing inadequate transparency. Taiwan blocked authorities departments from utilizing DeepSeek companies, and Australia banned the AI device on all authorities units, citing nationwide safety dangers. These governments argue that DeepSeek’s unclear information dealing with practices pose potential privateness threats, significantly given China’s Nationwide Intelligence Legislation, which permits authorities entry to company information. In contrast to Western AI corporations that face regulatory scrutiny however, most often, stay permissible, Chinese language AI companies like DeepSeek are sometimes seen as direct safety dangers, resulting in outright bans as a result of stricter information safety rules being adopted across the globe.
Korea’s information safety regulation, like that of the European Union’s Common Knowledge Safety Regulation (GDPR), emphasizes rules akin to information minimization, function limitation, and transparency, such in order that each legal guidelines are seen as having comparable ranges of safety. If DeepSeek is discovered to be transferring consumer information in ways in which violate any of the rules supplied by these Korean legal guidelines, it may face extra extreme regulatory motion. For a rustic like Korea, which has established itself as a frontrunner in tech innovation whereas sustaining sturdy information safety requirements, DeepSeek’s case serves as a essential take a look at of its regulatory framework.
In accordance with a press launch by the PIPC, revealed on Feb. 17, “DeepSeek has quickly suspended its service in Korea as of February 15, 2025, to boost compliance with the Private Info Safety Act (PIPA). The corporate plans to renew service as soon as crucial enhancements are made.”
Deepseek’s rise is consultant of China’s efforts to steer the AI race, independently from Western know-how. Nevertheless, its fast enlargement into world markets has reignited considerations over information sovereignty, as China’s Nationwide Intelligence Legislation supplies the prerogative of the Chinese language authorities to require corporations and residents to cooperate with nationwide protection and intelligence companies, because the regulation supplies that nationwide intelligence establishments could “request that related organs, organizations, and residents present crucial help, help, and cooperation” and that “All organizations and residents shall help, help, and cooperate with nationwide intelligence efforts in accordance with regulation […]”.
The suspension of DeepSeek has drawn consideration from Korea’s main AI companies, Naver and Kakao. Naver has responded by enhancing its AI mannequin, HyperCLOVA X, enhancing effectivity and decreasing operational prices to raised compete with DeepSeek’s low-cost, high-performance method. Whereas dedicated to creating its personal AI, Naver stays open to collaboration with exterior suppliers.
Kakao, then again, has aligned itself with OpenAI, integrating a number of AI fashions relatively than focusing solely on in-house improvement. Nevertheless, Kakao’s management has expressed considerations over DeepSeek’s safety and reliability, suggesting that extra investments in security measures may negate its value benefits.
Korea is more and more acknowledged as an „AI center energy,“ alongside Japan, the EU and the Center East. The Boston Consulting Group (BCG) notes that as U.S.-China competitors intensifies, mid-tier AI nations like Korea have a singular alternative to increase their affect.
Considered one of Korea’s key benefits lies in its dominance of AI-related semiconductor manufacturing, with Samsung and SK hynix main the worldwide reminiscence chip market. Nevertheless, there are considerations that this benefit is probably not sustainable, as nations just like the U.S. and EU members make investments closely in home semiconductor manufacturing to cut back reliance on overseas provide chains.
Nevertheless, as noticed with the cautionary measures adopted in regard to DeepSeek, Korean corporations additionally face the problem of regulatory constraints on AI improvement. Whereas Korean companies have sturdy AI mannequin design capabilities, information accessibility stays a serious hurdle as a result of strict privateness legal guidelines. Some trade leaders have proposed permitting choose AI corporations higher entry to home datasets to help innovation whereas sustaining sturdy oversight, however for this to be efficiently carried out, the rules in pressure relating to information safety have to be noticed, or else the identical dangers and considerations raised in regard to DeepSeek will echo for every other firm processing information inside Korean jurisdiction.
As Korea’s AI trade adapts to those developments, the DeepSeek case underscores the continued debate over AI governance, information privateness and the steadiness between innovation and regulation. Whereas DeepSeek’s return to the Korean market stays unsure, its affect on AI coverage and trade competitors is simple.
Chyung Eun-ju (ejchyung@snu.ac.kr) is a tech analysis affiliate at Donghyun ASP. She earned each her bachelor’s in enterprise and grasp’s in advertising and marketing from Seoul Nationwide College. Joel Cho (joelywcho@gmail.com) is a training lawyer specializing in IP and digital regulation.
