Jungjingong Designated as Special Agency for Public Notice Delivery of Payment Orders under the Act on Special Cases Concerning Promotion of Litigation

Reduction of Litigation Costs by 76.6% through Simplified Legal Procedures
Establishing a Foundation for SME Rechallenge via Rapid Recovery of Policy Funds

The Small and Medium Business Corporation (Chairman Kim Hak-do, hereinafter referred to as SBC) announced on the 26th that it has been designated as an institution eligible for special application of public notice delivery for payment orders following the passage of the amendment to the "Special Act on Promotion of Litigation, etc." (hereinafter referred to as the Litigation Promotion Act) at the 406th National Assembly (extraordinary session) plenary session. The main point of this amendment is to designate SBC, a policy financial institution, as a special institution for public notice delivery, allowing payment order applications without going through litigation procedures as an exception to the Civil Procedure Act.

Small and Medium Business Corporation

Currently, banks and financial public enterprises are legislated to allow public notice delivery without litigation procedures, but SBC was excluded from the target institutions, causing unnecessary costs for both small and medium enterprises and SBC. With this amendment, SBC is expected to save about 1 billion KRW annually in litigation costs through payment orders via public notice delivery and reduce the duration by an average of 6 to 10 months. For example, in a case where the claim amount is 100 million KRW, the court fee for a payment order application is about 40,000 KRW, which is one-tenth of the 400,000 KRW court fee for filing a lawsuit. Under litigation procedures, the party must appear in court more than twice, but if there is no objection from the debtor in the case of a payment order, an enforceable title can be obtained immediately.

Kim Hak-do, Chairman of SBC, said, "The designation of SBC as a special institution for payment order public notice delivery, a long-standing issue in the field, can contribute to enhancing fund soundness through litigation cost reduction and rapid fund recovery," adding, "We will make every effort in policy support so that the effect of the amendment can lead to the re-leap and recovery support of our small and medium ventures."

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