The Democratic Party Proposes Special Act on Jeonse Fraud... Accelerating Processing Speed

Kim Jeongjae, People Power Party Lawmaker, Leads Proposal
"Urgent Measures Needed to Alleviate Housing Instability for Victims"

A special bill to support victims of Jeonse fraud was proposed in the National Assembly on the 27th. Since the ruling and opposition parties have agreed on prompt support related to Jeonse fraud victims, it is expected to be processed through the Land, Infrastructure and Transport Committee on the 28th and then at the next plenary session.

Kim Jeong-jae, a ruling party secretary of the National Assembly Land Committee, officially proposed the "Special Act on Support for Jeonse Fraud Victims and Housing Stability" on the same day. Co-sponsors include members of the Land Committee such as Kang Dae-sik, Kim Seon-kyo, Kim Hak-yong, Park Jeong-ha, Seo Beom-su, as well as Park Dae-chul, chairman of the Policy Committee, Lee Yang-su, senior deputy floor leader, and 15 others.

Park Dae-chul of the People Power Party, Kim Min-seok of the Democratic Party of Korea, and Kim Yong-shin, Policy Committee Chair of the Justice Party, are holding a trilateral policy committee chair meeting on measures against jeonse fraud at the National Assembly on the 21st. From left: Lee Man-hee, Senior Deputy Chair of the Policy Committee of the People Power Party; Kim Min-seok, Chair of the Policy Committee of the Democratic Party of Korea; Park Dae-chul, Chair of the Policy Committee of the People Power Party; Kim Yong-shin, Chair of the Policy Committee of the Justice Party; Kim Sung-joo, Senior Deputy Chair of the Policy Committee of the Democratic Party of Korea. Photo by Kim Hyun-min kimhyun81@

The special law first allows victim tenants to apply to the court, the head of the relevant tax office, or the local government chief for a suspension or postponement of auction or sale procedures if the house is under auction or seized due to national or local taxes. Under the current system, only the auction applicant can request a suspension or postponement of the auction.

Additionally, the special law grants victim tenants the right of first refusal to purchase the house they reside in if it is auctioned or sold through public sale. Accordingly, courts and others must decide on the sale to the victim tenant if the tenant has made a prior purchase declaration. Previously, victim tenants could only win the bid if they placed the highest bid like other creditors when the leased house was auctioned.

The landlord's total tax payment is apportioned by individual houses, and tax authorities are required to separately recover only the tax arrears related to the specific house during auction. This enables victim tenants to apply for auction or public sale. This improves the previous situation where tenants were practically unable to apply for auction if the landlord had large tax arrears.

Besides this, the special law includes provisions allowing victim tenants who wish to continue living in their current house but do not want to win the bid to transfer their right of first refusal to the Korea Land and Housing Corporation (LH), which can then provide the house as public rental housing.

To qualify under the special law, tenants must meet all six conditions: having legal opposability and a confirmed date, auction or public sale proceedings (including execution titles) on the leased house, the house being a low-income tenant house considering area and deposit (detailed requirements delegated to subordinate laws), suspicion of Jeonse fraud intent such as investigation initiation, risk of multiple victims, and risk of substantial non-return of the deposit.

Regarding the reason for proposing the bill, Kim’s office explained, "Since the current government took office, various efforts have been made to structurally block Jeonse fraud through preventive measures, but support for victims has been limited. As the expiration of past Jeonse fraud contracts has recently arrived, continuous victimization is expected for some time. Therefore, it is urgent to prepare measures to alleviate housing instability for victims facing eviction risks due to auction or public sale."

Although some differences remain between the ruling and opposition parties regarding the special law, the policy chiefs of the People Power Party, the Democratic Party, and the Justice Party have agreed on prompt support for Jeonse fraud victims, so the bill is expected to be processed swiftly. Park Hong-geun, floor leader of the Democratic Party, also expressed his determination at the policy coordination meeting on the same day, stating, "We will also take steps to expedite the urgent Jeonse fraud victim support bill." The National Assembly Land Committee plans to hold a plenary meeting on the 28th to consider and process Kim Jeong-jae’s bill, Democratic Party member Jo O-seop’s special bill, Justice Party member Shim Sang-jeong’s special bill, and the Jeonse fraud prevention bill. Subsequently, it plans to submit these bills to the next plenary session for approval as early as possible.

This content was produced with the assistance of AI translation services.