South Korea strengthens international arbitration framework

The changes include the introduction of a dedicated international legal affairs department within the South Korean government and new mediation rules, and there are a number of notable court decisions.

New dedicated government department

The Ministry of Justice has established a new department dedicated to international legal affairs. This department is tasked with strengthening international arbitration, reflecting South Korea's commitment to providing robust support for global arbitration practices.

Read more of our report on international arbitration in 2025

• International arbitration: regional, sectoral and industry developments reinforce dispute resolution status
• UAE: recent arbitration reforms while legacy DIFC-LCIA clause debate continues
• Saudi Arabia firmly on the map as key arbitration and dispute resolution hub
• New digital services and legal developments boost international arbitration usage in Qatar
• Egypt a ‘central hub’ for arbitration in the MENA region
• Investment disputes continue to drive international arbitration developments in Africa
• Southern African states form harmonised arbitration framework
• UK arbitration developments continue to enhance position as key dispute resolution jurisdiction
• French arbitration law evolves ahead of 2025 reforms
• Germany to become more attractive for international arbitration proceedings
• Singapore continues to rise as an international dispute resolution hub
• Continued improvements in international arbitration driven by new HKIAC rules and case law
• India continues work to modernise arbitration landscape
• Significant developments in Japan’s arbitration landscape
• South Korea strengthens international arbitration framework
• China continues to improve arbitration process efficiency and effectiveness
• Australian court rulings strengthen pro-arbitration stance and expand scope of arbitration
• Construction projects and contracts must consider sanctions risks
• New types of M&A disputes will drive up international arbitration cases
• Growing demand for expertise in cryptocurrency related arbitration in 2025
• Major changes crystallising in investor-state dispute settlement
• What the future holds for mediation in investor-state dispute settlement

The ministry’s new International Legal Affairs Department was established in August 2023 after two existing divisions were divided into three new divisions – the International Legal Policy Division, the International Legal Advisory Division and the International Dispute Settlement Division.

The dispute settlement division has already handled a number of investor-state dispute settlement (ISDS) cases while the legal advisory division manages government-related international commercial arbitrations. It also represents the South Korean government and its agencies in international litigation cases.

The launch of the new department has been welcomed by members of the international arbitration community.

KCAB implements international mediation rules

As of 1 January 2024, the Korean Commercial Arbitration Board (KCAB) has enacted and implemented the KCAB International Mediation Rules. These rules are designed to enhance dispute resolution through international mediations, further strengthening South Korea’s position as an attractive hub for alternative dispute resolution.

Legal developments and court decisions

The Supreme Court of South Korea recognised that the “seat of arbitration” – the legal place of arbitration – is distinct from the “place of arbitration”, which refers to where arbitration proceedings, for instance hearings, occur. The court interpreted the “site for arbitration proceedings” in the parties’ arbitration agreement as the “seat of arbitration” rather than the physical “place of the arbitration (venue)”. The court further clarified that the “place of arbitration (venue),” the “seat of arbitration,” and the “location of the arbitral institution” need not be the same. The court also expressed the view that, when parties agree on a “place for dispute resolution”, it generally signifies the “seat” of arbitration, save for in exceptional circumstances.

Furthermore, the court acknowledged that a foreign arbitral award could be denied recognition or enforcement or set aside if the tribunal’s composition or the procedure adopted was inconsistent with the parties’ agreement. Demonstrating such violations alone is insufficient. It must also be shown that the parties’ procedural rights were significantly compromised for the court to refuse recognition or enforcement or to set aside a foreign arbitral award.

These developments highlight South Korea's proactive approach to strengthening its international arbitration framework, ensuring that it remains a competitive and reliable hub for resolving international disputes.