S. Korean gov’t to upgrade local lemon law

South Korea’s Ministry of Land, Infrastructure and Transport will upgrade its local lemon law, Automobile Management Law, which requires sellers to compensate buyers for failing to meet certain standards of quality and performance

The plan includes the introduction of a performance analysis-based arbitration system.

The law, which became effective on Jan. 1, 2019, enhances customers’ convenience.

The term “lemon” has long been used to describe defective vehicles in the US.

The number of lemon car cases in South Korea has risen from 79 in 2019 to 668 in 2020 and 707 in 2021.

The government said it will introduce a procedure that ensures mediation before arbitration.

Under the current arbitration system, judgment is limited to applications for exchange or refund, and it takes a long time before a final judgment is made, thus increasing consumer inconvenience.

Once the mediation procedure is introduced, judgment can be made not only on applications for exchange or refund but also for repair and compensation.

The ministry intends to press for legislation after laying out a plan for the implementation of the mediation process in the first half of next year.

A self-diagnosis tool will be added to the ministry's website so that customers may more easily determine whether their claims qualify for an exchange or refund before submitting an arbitration request.

The Automobile Management Law states that only after the conditions for an exchange or refund have been met may the arbitration process start.

However, due to difficulty in checking the requirements, 858 cases have been dismissed or rejected over the past three years.