SOUTH KOREA Trends and Developments Contributed by: Sang Oh Jeon, Hee Jae Lee, Chiyeol Kim and Seokmin Song, Yoon & Yang LLC
association and a labour union falls within the regula - tory scope of the MRFTA. Specifically, it clarifies that legitimate collective actions aimed at maintaining or improving working conditions do not fall within the MRFTA’s regulatory reach, and that refusing to com - ply with a KFTC investigation in such cases does not constitute obstruction. Trends in Civil Damages Litigation Expansion of directors’ liability Shareholder actions seeking damages against direc - tors in connection with KFTC sanctions decisions have become increasingly common, and courts are likewise adopting a broader view of the scope of liability for representative directors and other corporate officers. Shareholders of a butane gas manufacturer, which had been fined and sanctioned approximately KRW16 billion by the KFTC for price-fixing, filed a derivative suit against its representative director. The court held that the representative director was liable for dam - ages, reasoning that a representative director who violated laws in the course of performing their duties and thereby caused harm to the company must bear responsibility for such harm. The court calculated the damages at KRW9.7 billion, representing 60% of the fines and penalties imposed. The Supreme Court affirmed the lower court’s decision. Due to recent amendments to the Commercial Code expanding directors’ duty of loyalty toward sharehold - ers and requiring equal treatment of all shareholders, derivative litigation seeking directors’ liability for harm to minority shareholders caused by cartels or unfair intragroup transactions is expected to increase. Collective dispute mediation and litigation following the KFTC’s sanctions against Nexon In January 2024, after the KFTC sanctioned Nexon for allegedly manipulating probabilities of loot-box items in its MapleStory online game without informing users, the Korea Consumer Agency conducted col - lective dispute mediation on behalf of approximately 5,800 affected users. Nexon accepted the mediation decision, resulting in payments totalling approximately KRW21.9 billion, the largest amount ever awarded through collective dispute mediation.
Separately, in a lawsuit filed by a MapleStory user seeking return of the purchase price based on the same allegations, the appellate court limited the rescission for Nexon’s deceptive conduct to 5% of the total purchase price, considering the purpose and nature of the game, characteristics of item transac - tions, user motivation and the scale of the transac - tions. This decision illustrates that courts may exer - cise discretion to award reasonable damages where quantifying precise losses proves difficult. Antitrust Enforcement Outlook Under the Lee Administration Following the inauguration of the new administra - tion in June 2025, significant changes are expected in Korea’s antitrust enforcement approach. The Lee Jae Myung administration is anticipated to establish new regulatory frameworks targeting online platforms, such as introducing a market inquiry system to imple - ment ex ante regulation in the digital services sector. It is also expected to strengthen regulation of unfair bargaining practices by granting collective bargain - ing rights to franchisees, contractors and sellers on online platforms. Meanwhile, discussions are under - way regarding the introduction of a Korean-style dis - covery system, which would allow court-appointed experts to investigate and collect evidence through on-site investigations to facilitate proof of unfair trade practices and technology misappropriation, as well as to assist in calculating damages. Furthermore, the KFTC’s enforcement capabilities are expected to be strengthened through personnel expansion and improvements in the organisational structure.
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