Assemblyman Kim Seung-won Proposes Amendment to Debtor Rehabilitation Act to Ease Debtor Burden

Penalty for Violating Duty to Explain During Bankruptcy Proceedings
Reduced to a Fine of Up to 5 Million Won

On the 13th, Kim Seung-won, a member of the National Assembly's Political Affairs Committee from the Democratic Party of Korea, proposed a partial amendment to the "Debtor Sacrifice and Bankruptcy Act" to ease the criminal penalties for debtors' failure to fulfill their duty to explain during bankruptcy proceedings. Kim explained that the purpose is to reduce the burden on debtors facing economic difficulties by lowering excessive punishment levels.

According to the current law (Article 658 of the Debtor Rehabilitation Act), debtors are obligated to provide necessary explanations when requested by the bankruptcy trustee during bankruptcy proceedings. If they violate this without justifiable reason or provide false answers, they face imprisonment of up to one year or a fine of up to 10 million won.

The amendment proposed by Kim deletes the existing criminal penalty provisions (imprisonment and fines), which are considered excessive, and lowers the punishment level to impose a fine of up to 5 million won.

The Ministry of Justice and the Supreme Court also raised the need to review lowering the penalty provisions of Article 653 of the law and adjusting Article 658 to fines during the November last year discussion at the Legislation and Judiciary Committee's first subcommittee.

Kim stated, "The excessive penalty provisions of the current law place unnecessary burdens on debtors who are already at their limits," and added, "Through this amendment, I hope to reasonably reduce the level of punishment and alleviate the burdens of debtors experiencing economic difficulties."

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