Land Expropriation and Compensation

The State and public institutions carry out various public-interest projects, such as the construction of public housing, the expansion of transportation infrastructure including roads and railways, and the development of industrial complexes.

In this process, the land and objects required for a project must be secured, so a purchase contract is first concluded through consultation with the landowner.

However, in preparation for cases where consultation is not reached amicably, the legal system that allows the State or a public institution to compulsorily acquire the land needed for a public-interest project together with just compensation, while protecting citizens’ property rights, is the ‘land expropriation system.’

① Compulsory nature

Land expropriation is a compulsory act by which the State or a public institution can acquire land for a public-interest project even without the individual’s consent.

② Principle of just compensation

Because a compulsory acquisition takes place, just compensation corresponding to the market price must be paid to the person subject to expropriation.

④ Guarantee of procedural legitimacy

Land expropriation must go through transparent and fair procedures based on law, and the person subject to expropriation is guaranteed rights such as the right to raise objections and to request a trial.

⑤ Principle of priority of public interest

Land expropriation must always be for a public-interest purpose, and it is not permitted for the purpose of private interest.

⑥ Promptness and efficiency

A certain degree of promptness is maintained so that the public-interest project can proceed without disruption, and institutional mechanisms are in place to prevent unnecessary delay.

For land for which a negotiated purchase has not been reached, the project operator files an application for an adjudication of expropriation with the Land Expropriation Committee.

The received application for adjudication is then sent to the city, county, or district where the land is located, with a request that public notice and inspection be carried out.

The city, county, or district posts the relevant content on a notice board for 14 days and gives individual notice to landowners and others so that they may inspect the content of the expropriation application.

At this time, the owner may, during the public notice period, inspect the expropriation application documents and submit a written opinion.

The written opinion should specifically state the following wishes or requests concerning the expropriation.

The Land Expropriation Committee reviews the opinions submitted by the owner and the project operator and verifies the facts through on-site investigation.

In this process, it reviews the matter in depth so that the owner's assertion of rights is sufficiently reflected.

An appraisal is commissioned from two independent appraisal institutions to calculate an appropriate amount of compensation for the land.

The appraisal results serve as the basis for fair payment of compensation.

The land expropriation committee prepares the expropriation ruling on the basis of the appraisal results and the findings of the factual investigation, and finalizes it through the committee's deliberation.

The ruling is served on the owner by special service, and where service is not possible, it is posted and published for 14 days at the city, county, or district office having jurisdiction over the location of the land.

Objection

The owner may file an objection within 30 days from the date of receiving the adjudication document, and in the objection procedure, reappraisal and reexamination are carried out.

∙Filing of administrative litigation

After service of the adjudication document within 90 days (within 60 days where an objection has been filed), the legality of the adjudication and the appropriateness of the compensation amount may be contested before the court through administrative litigation.

Land compensation is based on the officially assessed land price published each year as of January 1.

A certified appraiser conducts the appraisal by comprehensively considering the rate of change in land prices, the rate of increase in producer prices, and the individual characteristics of the land subject to expropriation.

However, land price artificially raised by the relevant public works project (development gains) or speculative prices are not included in the appraisal.

In addition, compensation is in principle paid in cash, but it may be paid in bonds at the owner's request or under certain conditions.

For buildings and other obstructing structures, relocation costs (the costs of dismantling, transporting, and reinstalling) are compensated first.

If the relocation cost exceeds the acquisition price or relocation is not possible, compensation is based on the acquisition price of the building or other structure.

Business suspension compensation is paid based on the operating profit for up to four months of the suspension period.

Business closure compensation covers two years of operating profit, and an eligible claimant for business closure compensation must meet one of the following requirements.

Requirements for Business Closure Compensation

Where the project operator expropriates or purchases part of the land and the value of the remaining land (the residual land) declines, or where construction of a passage, a ditch, a fence, or the like is required, the amount of the loss and the construction costs are compensated.

For specific rights such as mining rights and fishing rights, compensation for the extinction of the relevant right is paid separately in accordance with the relevant statutes.

Where neighboring farmland not included in the project district becomes inaccessible because it is surrounded by mountains, rivers, or the like as a result of the project's implementation, the land may, upon the owner's request, be treated as land within the project district and compensated.

For farmland incorporated into a project district, two years' worth of the average total agricultural income of farming households over the immediately preceding 3 years is compensated as the agricultural loss amount.

In this case, where the owner of the farmland and the actual cultivator differ, compensation is provided as follows.

Where an agreement is not reached or an agreement is not possible, the project operator may apply to the competent land expropriation committee for a ruling.

A person who objects to an adjudication of a land expropriation committee may within 30 days from the date of receiving the authentic copy of the written adjudicationfile an objection in writing (a prescribed written objection) with the Central Land Expropriation Committee.

This law firm has a substantial number of attorneys registered with the Korean Bar Association, including attorneys specializing in expropriation and compensation, attorneys specializing in real estate, and attorneys with an average of more than 10 years of experience.

Accordingly, professional and systematic legal support is available for various matters related to land expropriation and compensation, such as procedures, contracts, disputes, and permits and approvals.

If you need assistance in the course of land expropriation and compensation, you may request the support of a specialized attorney at any time.