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Ruling and Opposing Parties Clash Over “Retroactive Application” of Class Action Act; Passage in Plenary Session Is Possible as Early as First Half of the Year
In the wake of incidents such as the large-scale data breach at Coupang, momentum is building in the National Assembly to pass a Class Action Act that would expand the application of class actions, currently limited to the securities field, to encompass all industrial sectors.
The Class Action Act establishes a legal framework under which a favorable judgment obtained by representative plaintiffs in cases involving multiple victims extends its legal effect to all other class members. In Korea, it was introduced in 2005, with its application restricted to the securities sector.
The key point of contention is whether to adopt an “opt-out” system, which automatically includes all victims as plaintiffs of litigation.
In Korea, general consumer harm cases, excluding those in the securities sector, follow an “opt-in” system, where victims must individually express their intent to participate in the lawsuit, and the effect of the judgment extends only to those participants. In contrast, the U.S. style class action system adopts an “opt-out” approach, under which all victims are automatically included in the plaintiff class unless they choose to exclude themselves.
The government and the ruling party are ramping up efforts to pass the legislation that would expand the opt-out system to all damage claim lawsuits. The proposed Class Action Act, introduced by the Democratic Party of Korea’s lawmaker Kyoon Taek PARK, seeks to repeal and replace the existing framework limited to the securities sector with a system that permits class actions for all types of damages. Notably, this Act includes a retroactive provision, allowing it to be applied to incidents that occurred prior to its enforcement.
Meanwhile, the “Coalition for Class Action Act Enactment,” a group of 19 organizations including the Citizen’s Coalition for Economic and Justice (CCEJ), People’s Solidarity for Participatory Democracy (PSPD), and MINBYUN-Lawyers for a Democratic Society, has called for its swift introduction, arguing that “Korea is the only OECD member that lacks a class action system.” Conversely, the Federation of Korean Industries (FKI) has expressed concerns, stating that “amidst the heightened business uncertainty resulting from the Iran conflict, the Class Action Act could lead to a surge in litigation defense costs for companies.”
As the first-ever Korean law firm to issue specialized legislative journals, D&A Public Sector Relations Group has been publishing the monthly Policy & Business Report since August 2019. The April 2026 issue of the P&B Report conducted a full inspection of legislation proposed to the National Assembly Subcommittee, Standing Committee, and Plenary Session from the opening of the 22nd National Assembly on March 15, 2026, to April 14, 2026, and selected and analyzed legislation with significant impact on corporate activities. In the case of major legislation, key mentions of legislators, members of the Standing Committee, and government officials are included.
*D&A Public Sector Relations Group provides P&B Report subscription services. Please contact us at lc@draju.com for further inquiries.
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