Study on the Suitable Operation of the Punitive Damages System


Recently, there has been much discussion on punitive damages, and particularly, much debate over whether or not punitive damages should be adopted into Korean law. Since the adoption of punitive damages in the 2011 Fair Transactions in Subcontracting Act—which stipulates that punitive damages must not exceed more than three times the damages incurred—many other laws and regulations have been adopting punitive damages. Numerous government departments have also announced plans to further adopt punitive damages, and various bills relating thereto have been submitted to the National Assembly. However, there is still much debate as to whether the adoption of punitive damages is appropriate, and there is fundamental criticism regarding the validity of the systems already adopted.

While theoretical discussion on the problems of the punitive damages system itself is obviously important, given the increasing adoption of punitive damages in current and ongoing legislation, the question of how systems that have already been adopted should be operated is of equal significance. The purpose of this report, which focuses on the suitable operation of the punitive damages system, is to provide a basis for discussion regarding the appropriate adoption and operation of punitive damages to effectively achieve their intended goal.