Ruling party lawmaker pushes bill to impose surcharges up to 3 times illicit gains from hoarding

Legislation that would allow authorities to impose surcharges of up to three times the illicit gains from hoarding and cornering is moving forward in the National Assembly.

Rep. Song Jae-bong of the Democratic Party of Korea, who represents Cheongju Cheongwon in North Chungcheong Province, introduced the bill — an amendment to the Act on Price Stability — on Sunday.

Under current law, those found guilty of hoarding and cornering face up to three years in prison or a fine of up to 100 million won (about $65,800). Critics have long argued, however, that criminal penalties alone are insufficient to claw back profits from such conduct, particularly when it is carried out for financial gain amid supply disruptions or sharp price spikes.

The amendment would address that gap by empowering authorities to impose a surcharge of up to three times the illicit profit on those found to have engaged in hoarding and cornering, according to Song.

When calculating illicit gains proves difficult, the surcharge would be determined based on criteria set by presidential decree, taking into account factors such as the transaction value of the goods in question and the value of stockpiled or withheld quantities. The bill also raises the maximum fine from 100 million won to 300 million won.

President Lee Jae Myung said at a Cabinet meeting in April that criminal punishment was being overused and called for a system designed so that the burden of breaking the law outweighs any benefit. "Economic sanctions such as surcharges and administrative fines should be actively used, and the system should be designed so that the burden imposed exceeds the gains from illegal conduct," he said.

The amendment is intended to reflect that concern by establishing effective economic sanctions against hoarding and cornering, Song's office said.

"Hoarding and cornering is a textbook form of market disruption that exploits price instability and supply confusion to pile additional burdens on the public," Song said. "Criminal punishment alone has limits when it comes to recovering illicit profits and responding swiftly, so introducing surcharges will enable more effective sanctions. I hope this amendment strengthens the government's ability to stabilize prices and becomes a tangible measure that people can feel."