Legislation on Unilateral Binding Force... Stronger Financial Consumer Protection Measures Introduced

A bill introducing unilateral binding force, a key pledge of President Lee Jaemyung during the 21st presidential election, has been proposed in the National Assembly.

On September 12, Hyunjung Kim, a member of the National Policy Committee and a lawmaker from the Democratic Party of Korea, announced that she had proposed a partial amendment to the Act on the Protection of Financial Consumers, which would introduce unilateral binding force in small-scale financial dispute cases.

Unilateral binding force is a system in which, if a financial consumer accepts a settlement proposal made by the dispute mediation committee of the Financial Supervisory Service, the settlement is finalized regardless of whether the financial company agrees. This mechanism allows consumers to obtain relief quickly without going through complicated litigation procedures. Major countries such as the United Kingdom, Japan, and Australia have already implemented this system for small-scale disputes.

In Korea, there are already special provisions for small-scale disputes, such as prohibiting lawsuits before a settlement proposal is presented. However, if a financial company rejects the proposal, the case ultimately proceeds to trial, forcing consumers into complex litigation processes.

Hyunjung Kim stated, "There have been cases where financial companies delay the process by refusing to accept settlement proposals or by filing lawsuits against consumers. It is urgent to establish a system to protect consumers who are at a disadvantage in terms of capital and information." She added, "If this amendment is passed, consumers will be able to avoid unnecessary litigation burdens in small-scale disputes and have their rights protected more quickly and thoroughly. I will continue to do my best to correct the imbalance between financial companies and consumers and to strengthen consumer protection."

Hyunjung Kim, Member of the Democratic Party of Korea. Office of Hyunjung Kim

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