The EU’s push to deepen digital trade ties with South Korea has raised concerns that it could come at the expense of Europe’s regulatory autonomy. One lawmaker warned that the deal could tie the EU’s hands on data localisation and source-code rules, potentially limiting its room to regulate in the future.

“I worry about how this and other digital trade agreements will affect our own ability to regulate in the future”, Markéta Gregorová, a Green Member of the European Parliament, said during a debate in the EP’s International Trade Committee.

Specifically, she questioned the agreement’s prohibition on forced data localisation. The deal would generally prevent the EU from requiring companies to store or process data within its borders. That potentially means limiting the bloc’s ability to introduce such requirements in the future.

Gregorová, who is working on the draft report on behalf of Greens, also questioned the need for binding rules on source-code protection. She argued that companies already have legal safeguards against theft through intellectual-property rights and trade secrets.

“Is it really proportional to force us to comply with binding permanent trade disciplines that will require the EU in the future to justify any measure and prove that the chosen EU regulatory approach is the least trade-restrictive possible?” she asked. She, personally, isn’t sure “we want our hands tied so closely.”

Business opportunities versus regulatory concerns

Other lawmakers, however, striked a much more positive tone.

Jörgen Warborn (EPP/SWE) pointed at the barriers that small and medium European companies (SMEs) currently face, describing the deal as being “about making trade easier in practice.” He pointed out that SMEs are the ones bearing the cost of unnecessary administrative requirements.

Mr Warborn also pushed back on the concerns over data transfer. He argued “the Commission confirmed that Korea continues to provide an adequate level of personal data protection.”

Similarly, Renew’s shadow rapporteur, MEP Dan Barna (Renew/ROM), framed the agreement as a competitiveness tool. In particular, he highlighted the benefits of smaller European companies accessing the South Korean market “in an era where more than half of service trade is already digital.”

“For us, the liberals, this is precisely what an open digital economy should look like: fewer artificial barriers, more choice for consumers, and a level playing field for companies to innovate and compete,” he stated.

Commission: EU rules will not be constrained

The European Commission rejected concerns that the agreement would limit the EU’s regulatory power. On source code, an official representing its trade branch said the provisions would not prevent the implementation of any EU legislation. He specifically named the bloc’s AI rules, the Digital Markets Act and the Digital Services Act.

The official also stressed that the EU would retain full control over personal-data protection. “We reserve full policy right to implement the GDPR and any other measures on the protection of personal data,” he said, adding that such measures would not be subject to proportionality or necessity tests under the agreement.

For non-personal data, the Commission acknowledged that the deal prohibits forced data localisation, but emphasised that the ban applies to unjustified requirements, with “very broad exceptions that allow for legitimate measures.” 

Besides, according to the Commission, current agreements may protect source code as intellectual property, but they do not stop a third country from requiring access to it as a condition for market entry. The new agreement is intended to close that gap.

Trading partner number eight

The EU-South Korea Digital Trade Agreement intends to deepen digital trade ties between the countries. The proposal, currently debated in the committe, would complement the EU-South Korea Trade Agreement.

The deadline for amendments is 8 October, with an indicative plenary sitting scheduled for 14 December.

The new agreement would establish a dedicated framework for trade conducted electronically, to reduce administrative burdens and provide greater legal certainty. It covers cross-border data flows, electronic contracts, signatures, e-invoicing and paperless trade, source-code protection and online consumer safeguards, as well as a permanent prohibition on customs duties on electronic transmissions.

The economic relationship is already substantial. In 2025, South Korea was the EU’s eighth-largest goods trading partner.