Gyeonggi Province Launches Support for Commercial Tenants in Rent Dispute amid COVID-19 Crisis

[Suwon Ilbo=Reporter Park No-hoon] Gyeonggi Province, currently promoting a 'Good Landlord Movement' to assist small business owners facing bankruptcy due to COVID-19 expansion, is stepping up support for commercial rent adjustment.
With most small merchants experiencing difficulties such as rent arrears and contract termination due to sharp sales declines caused by COVID-19, the province aims to expand professional consulting related to rental disputes and activate the functions of its dispute mediation committee.

According to Gyeonggi Province on the 22nd, the province will first support 'Commercial Tenant Rent Reduction Adjustment Mediation' to mediate rental disputes arising at the field level due to COVID-19 and foster coexistence between landlords and tenants.
The province plans to increase professional consulting on commercial rental disputes from the current twice-weekly schedule to five times per week, and provide necessary forms to tenants requiring rent adjustment so they can easily exercise their rights.
Also, anticipating that an increase in professional consulting will lead to more dispute mediation applications, the province plans to further activate the functions of the 'Gyeonggi Province Commercial Tenant Dispute Mediation Committee' to ensure swift dispute resolution.
Mediation results through the Mediation Committee carry the same enforcement power as court judgments under the Commercial Building Lease Protection Act, and enforcement is possible without separate court rulings. Accordingly, the province plans to promote that dispute mediation is more convenient than litigation to increase mediation cases.

Consultations regarding commercial rental disputes are available through phone or in-person consultation via Gyeonggi Province Free Legal Consultation Office (031-8008-2246) or Gyeonggi Province Call Center (031-120) (phone/in-person consultation available at all times), and advice can also be obtained through certified real estate agents appointed by Gyeonggi Province.
Those wishing to apply for dispute mediation should complete an application posted on the Gyeonggi Province website (Home > Civil Service > Civil Service > Free Legal Consultation > Commercial Tenant Dispute Mediation) and submit it to the Gyeonggi Province Commercial Tenant Dispute Mediation Committee (Legal Affairs Division, 1 Hyowon-ro, Paldal-gu, Suwon, Gyeonggi Province).

Meanwhile, according to Article 11 of the Commercial Building Lease Protection Act, "in cases where rent or security deposit (omitted) becomes inappropriate due to changes in economic circumstances, the parties may request an increase or decrease in future rent or security deposit."
However, it remains an unfamiliar system in Korea, and with the exception of a 2017 case where a tenant of a convenience facility in a hospital requested lower rent citing a reduction in foot traffic due to the "enforcement of the Anti-Corruption Act," there are no related cases.
Meanwhile, in Japan, which has a similar legal system to Korea, mediation-first principles are adopted for rent adjustment, enabling smooth adjustment between parties, and cases of reduced rent due to changes in economic circumstances are commonly found.

Governor Lee Jae-myung stated, "In an unprecedented economic crisis caused by COVID-19, the difficulties faced by commercial tenant small merchants are indescribable," adding "I thank landlords participating in the Good Landlord Movement, and coexistence is essential to overcome this crisis. We ask for the cooperation and participation of many landlords."