Assignment (Transfer)
Overview
Assignment (양도, 讓渡) refers to a legal act by which certain rights, such as property rights or claims, are transferred from the current right holder (assignor) to another person (assignee) through a causative act (e.g., sale, gift). The Civil Code distinguishes between the transfer of real rights and the assignment of claims, setting different requirements for formation and opposability for each. Assignment is a core legal means of property rights transactions and forms the basis of economic activity.
Main Content
1. Assignment of Claims
Assignment of claims (채권양도) refers to a creditor transferring a claim to a third party (assignee) by contract. Article 449 of the Civil Code stipulates: "Claims may be assigned. However, this shall not apply when the nature of the claim does not permit assignment." The assignment of a claim takes effect solely by agreement between the assignor and assignee (formation requirement), but to oppose the debtor or a third party, the debtor must be notified or give consent (opposability requirement). Notification must be made by a document with a fixed date to be opposable to third parties other than the debtor.
2. Transfer of Real Rights
Transfer of real rights (물권양도) refers to the act of transferring real rights such as ownership, superficies, or mortgages. The transfer of real rights over immovable property takes effect solely by agreement between the parties, but registration is required to oppose third parties (Article 186 of the Civil Code). The transfer of real rights over movable property gains opposability through delivery (transfer of possession) (Article 188 of the Civil Code).
3. Restrictions on Assignment
Some claims are prohibited from assignment by their nature. For example, claims based on a fiduciary relationship (mandate, employment, etc.), claims requiring the creditor's unique qualifications (claim for support), and claims prohibited from assignment by law (pension entitlement, part of wage claims) fall under this category. Additionally, assignment may be prohibited by special agreement between the parties, but this cannot be asserted against a bona fide third party (Article 449, Paragraph 2 of the Civil Code).
4. Distinction Between Assignment and Succession
Assignment refers to the transfer of rights by a legal act, whereas succession (승계) refers to a comprehensive transfer by inheritance or legal provisions. Assignment has the character of a specific succession, transferring only specific rights, and the assignor may bear separate obligations (such as warranty liability) even after the transfer of rights.
5. Assignment and Security
Assignment of claims is also used as a means of financing. Security assignment (양도담보) is a method where a creditor receives an assignment of a claim from a debtor, holds it as security, and returns or definitively acquires the claim upon repayment at maturity. This has strengthened legal stability through the Act on Security over Movable Property and Receivables (enacted in 2010).
Recent Trends
1. Revitalization of Electronic Claim Assignments
As of 2024, electronic promissory notes and electronic claims (assignment of claims by electronic means) are rapidly increasing. Amendments to the Framework Act on Electronic Documents and Electronic Transactions have clarified the legal effect of electronic claim assignments, and the Financial Services Commission has fully launched an electronic claim assignment registration system from 2025 to enhance transparency and security in claim assignments.
2. Strengthened Regulations on Capital Gains Tax
With the 2024 tax law amendment, procedures for reporting and paying capital gains tax on real estate have been simplified, but heavy tax rates for multi-homeowners are maintained. Additionally, taxation on the transfer of virtual assets (cryptocurrency) is scheduled to take effect from 2025, leading to active discussions on tax standards and reporting methods for virtual asset transfers.
3. Claim Assignments and Personal Information Protection
Issues have been raised regarding the provision of debtors' personal information to assignees during claim assignments. In 2024, the Personal Information Protection Commission established guidelines allowing only the minimum necessary information to be provided without the debtor's consent during claim assignments. This is a measure to alleviate concerns about personal information infringement in the debt collection process.
4. Changes in International Assignment Norms
The United Nations Commission on International Trade Law (UNCITRAL) Convention on the Assignment of Receivables was amended in 2024, trending toward the unification of governing law and opposability requirements for international claim assignments. South Korea is also preparing to amend its Private International Law Act accordingly.
Related Topics
- [[Assignment of Claims]]
- [[Changes in Real Rights]]
- [[Capital Gains Tax]]
- [[Security]]
- [[Civil Code]]
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