SOUTH KOREA Law and Practice Contributed by: Hyeon Kang, Tae Kyoon Kim, Seungil Hong and Sung-Ho Moon, Bae, Kim & Lee LLC
• a salt pan; or • housing (and attached/accompanying) land. 6.8 Costs Payable by a Tenant at the Start of a Lease Costs payable at the start of a lease include a security deposit and a maintenance fee, the amounts of which are negotiated with the land - lord. 6.9 Payment of Maintenance and Repair Under the Civil Code, the landlord is basically responsible for maintaining and repairing areas used by tenants, but the costs for maintenance and repair incurred by the landlord may be charged to tenants in accordance with the lease contract. In such cases, the tenants must pay for the maintenance and repair in proportion to the size of their leased property. 6.10 Payment of Utilities and Telecommunications Utilities and telecommunications charges are paid by tenants, in proportion to the size of their leased property. 6.11 Insurance Issues A landlord purchases a package insurance pol - icy and, in many cases, pays the premium for insurance, which includes coverage for:
There are very few insurance policies that cover reduced profits from the suspension of opera - tions, and there is no insurance policy that com - pensates for any damage caused by COVID-19. 6.12 Restrictions on the Use of Real Estate There are no regulations or laws generally restrict - ing a tenant’s use of real estate, but restrictions may be imposed by the landlord, relevant claus - es may be incorporated into a lease agreement, and regulations relating to specific areas may impose specific restrictions on a tenant’s use of real estate. For example, the Outdoor Adver - tisement Control Act (OACA) stipulates that any person who intends to display advertisements or change authorised advertisements must obtain permission from, or report to, the local govern - ment depending on the type of advertisements, thereby directly restricting a tenant’s use of real estate in connection with advertisements. 6.13 Tenant’s Ability to Alter and Improve Real Estate Under the Civil Code, a tenant is basically per - mitted to implement improvement measures that objectively increase the value of the leased real estate. However, the tenant is not allowed to alter or improve the real estate against the landlord’s objection. 6.14 Specific Regulations Special laws (as opposed to the general provi - sions of the Civil Code) do exist, such as: • the HLPA, which applies to residential leases; and • the CBLPA, which applies to commercial leases. Parties cannot contract around clauses con - tained in these special laws to the detriment of
• property all risk; • machinery risk; • landlord’s business interruption; • gas accident liability; and • general liability.
In some double-net or triple-net leases for retail stores, the tenant pays the cost of insuring the real estate.
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