This content is from: Local Insights

South Korea

The Product Liability Act (PLA) is expected to come into force in July 2002. However, a recent court ruling should alert consumer product manufacturers and distributors in Korea about product liability risks even before the PLA comes into force. The case concerned a tort claim for injuries from a sudden acceleration incident involving an automatic transmission automobile. The burden of proof on the alleged defect of the automobile in this case was shifted to the manufacturer, for the reason that the manufacturer has more detailed technical knowledge while the consumer is not expected to have the high level technology to test such product and would purely rely on the manufacturer. Until last year, in several similar reported cases, courts had ruled that the burden is on the claimants to prove alleged defects on the products.

Shifting the burden of proof onto the manufacturers or distributors is a principle found not only under the PLA (it has been adopted by courts in certain medical malpractice or environmental hazard related proceedings). However, the enactment of the PLA is more likely to occasion the manufacturers, and stakeholders in and financial lenders to such manufacturers, to have to deal with new risks for their operations. This applies particularly in the high-technology products industry where the burden of proof is more likely to shift to the manufacturer.

This recent Seoul district court ruling is likely to be appealed, and it remains to be seen how the appellate court will finally rule on this case. However, the possible change in the judiciary's view on the product liability, even before the enforcement of the PLA, should be recognized insofar as the burden of proof on the defects is concerned.

© 2021 Euromoney Institutional Investor PLC. For help please see our FAQs.

Instant access to all of our content. Membership Options | 30 Day Trial