I have been asked so many times from foreign companies or individuals, “what shall I do to collect my money under Korean laws?”.
There are certain steps widely and generally taken here in Korea, which is not quite different from other countries.
1. Sending a formal demand letter in the name of Korean attorney
This is optional, but there is possibility of voluntary repayment by the Korean debtor after receiving a demand letter from a Korean lawyer. It is effective especially when the debtor in Korea misconceives that foreigners cannot find a way to collect the money far away here in Korea.
2. Filing a request for the Payment Order to the Korean court
This is also optional. Payment order is much convenient, inexpensive, fast and easy way to get a judgment from the court compared to a lawsuit. It is widely known that Korean court has a tendency to issue Payment Order easily. A Payment Order shall be issued without questioning the debtor. If no objection has been raised from the debtor within 2 weeks, then the Payment Order has the same effect as a final and conclusive judgement. If the debtor objects to it, then the court regards your request for a Payment Order as a filing lawsuit and initiates your trial against the debtor(hearings and handing down a decision).
3. Filing a lawsuit
If the debtor still refuses to pay regardless of your demanding letter, then you have no choice but to file a lawsuit to Korean court.
It should be checked wheter the debtors have enough assets in Korea before filing a lawsuit. Also if they have, you might consider applying for a preliminary attachment against the debtors’ asset before filing a lawsuit.
4. Filing a compulsory execution
If you get the final and conclusive judgement from the relevant court, but the debtors still refuse to pay, then you shall file a compulsory execution to the court against the debtors’ assets in Korea.
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© 2008 Wonil Chung, a Korean Business Litigation Lawyer/Chung & Partners, a Korean Busienss Litigation Law Firm. All rights reserved. Some copyrights, photos, icons, trademarks, trade dress, or other commercial symbols that appear on this post are the property of the respective owners.