{"id":761,"date":"2026-04-09T19:58:36","date_gmt":"2026-04-09T19:58:36","guid":{"rendered":"https:\/\/atlaw.kr\/en-blog\/?p=761"},"modified":"2026-05-27T00:09:50","modified_gmt":"2026-05-27T00:09:50","slug":"destination-freight-forwarder-master-do-liability-south-korea","status":"publish","type":"post","link":"https:\/\/atlaw.kr\/en-blog\/destination-freight-forwarder-master-do-liability-south-korea\/","title":{"rendered":"Freight Forwarder Liability for Unauthorized Cargo Release in South Korea"},"content":{"rendered":"<p><!-- ATLAS_HREFLANG_START --><link rel=\"alternate\" hreflang=\"ko\" href=\"https:\/\/atlaw.kr\/kr-blog\/%eb%8f%84%ec%b0%a9%ec%a7%80-%ec%9a%b4%ec%86%a1%ec%a3%bc%ec%84%a0%ec%9d%b8-%eb%a7%88%ec%8a%a4%ed%84%b0do-%ec%86%90%ed%95%b4%eb%b0%b0%ec%83%81\/\" \/><link rel=\"alternate\" hreflang=\"en\" href=\"https:\/\/atlaw.kr\/en-blog\/destination-freight-forwarder-master-do-liability-south-korea\/\" \/><link rel=\"alternate\" hreflang=\"x-default\" href=\"https:\/\/atlaw.kr\/kr-blog\/%eb%8f%84%ec%b0%a9%ec%a7%80-%ec%9a%b4%ec%86%a1%ec%a3%bc%ec%84%a0%ec%9d%b8-%eb%a7%88%ec%8a%a4%ed%84%b0do-%ec%86%90%ed%95%b4%eb%b0%b0%ec%83%81\/\" \/><!-- ATLAS_HREFLANG_END --><br \/>\n<!-- Schema Markup --><\/p>\n<p><script type=\"application\/ld+json\">{\"@context\": \"https:\/\/schema.org\", \"@type\": \"Article\", \"headline\": \"Freight Forwarder Liability for Unauthorized Cargo Release in South Korea: Supreme Court 2024Da270860 Explained\", \"description\": \"South Korea's Supreme Court ruled in August 2025 that a destination freight forwarder who passed a Master D\/O copy to an importer without verifying payment committed an unlawful act. Attorney analysis of the ruling and its practical implications for exporters using D\/P payment terms.\", \"author\": {\"@type\": \"Person\", \"name\": \"Taejin Kim\", \"jobTitle\": \"Attorney at Law\", \"worksFor\": {\"@type\": \"LegalService\", \"name\": \"Atlas Legal\", \"url\": \"https:\/\/atlaw.kr\", \"address\": {\"@type\": \"PostalAddress\", \"addressLocality\": \"Incheon\", \"addressRegion\": \"Songdo\", \"addressCountry\": \"KR\"}}, \"@id\": \"https:\/\/atlaw.kr\/en\/taejin-kim-en\/#person\"}, \"publisher\": {\"@type\": \"Organization\", \"name\": \"Atlas Legal\", \"url\": \"https:\/\/atlaw.kr\", \"@id\": \"https:\/\/atlaw.kr\/#legalservice\"}, \"datePublished\": \"2026-04-09\", \"dateModified\": \"2026-04-09\", \"mainEntityOfPage\": {\"@type\": \"WebPage\"}, \"@id\": \"https:\/\/atlaw.kr\/en-blog\/destination-freight-forwarder-master-do-liability-south-korea#article\"}<\/script><\/p>\n<p><script type=\"application\/ld+json\">{\"@context\": \"https:\/\/schema.org\", \"@type\": \"FAQPage\", \"mainEntity\": [{\"@type\": \"Question\", \"name\": \"Under South Korean law, can I sue a destination freight forwarder if it released cargo before the importer paid?\", \"acceptedAnswer\": {\"@type\": \"Answer\", \"text\": \"Yes. The Supreme Court of South Korea held in its August 14, 2025 ruling (2024Da270860) that a destination freight forwarder who passed a Master D\/O copy to the importer without verifying payment unlawfully infringed the bill of lading holder's rights, constituting a tort under South Korean law. The exporter may claim the full unpaid amount as damages.\"}}, {\"@type\": \"Question\", \"name\": \"What is the difference between a Master D\/O and a House D\/O under South Korean maritime practice?\", \"acceptedAnswer\": {\"@type\": \"Answer\", \"text\": \"A Master D\/O (Master Delivery Order) is issued by the actual ocean carrier to the freight forwarder, authorizing the forwarder to remove cargo from the terminal. A House D\/O (House Delivery Order) is issued by the freight forwarder to the importer only after the importer has completed payment and surrendered the House B\/L. The Supreme Court confirmed in 2024Da270860 that the Master D\/O cannot serve as a delivery authorization for the importer.\"}}, {\"@type\": \"Question\", \"name\": \"Does passing only a Master D\/O copy to the importer make the freight forwarder liable in South Korea?\", \"acceptedAnswer\": {\"@type\": \"Answer\", \"text\": \"Yes. The Supreme Court held that releasing cargo based solely on a Master D\/O copy is carried out entirely under the joint risk of the bonded warehouse operator and the freight forwarder. If the bill of lading holder's rights are infringed as a result, both the warehouse and the freight forwarder bear liability for damages (Supreme Court of South Korea, 2024Da270860).\"}}, {\"@type\": \"Question\", \"name\": \"Does the one-year time bar under South Korean Commercial Act Article 814 apply to freight forwarders in South Korea?\", \"acceptedAnswer\": {\"@type\": \"Answer\", \"text\": \"Not when the defendant is a freight forwarder rather than a maritime carrier. The 2024Da270860 ruling confirmed that Article 814(1) of the South Korean Commercial Act \u2014 which extinguishes claims within one year of cargo delivery \u2014 presupposes that the defendant is a maritime carrier. Where the defendant is a destination freight forwarder or domestic partner, that premise is not met and the one-year bar does not apply.\"}}, {\"@type\": \"Question\", \"name\": \"Can a long-standing trade practice of passing Master D\/O copies excuse the freight forwarder's liability in South Korea?\", \"acceptedAnswer\": {\"@type\": \"Answer\", \"text\": \"No. The South Korean Supreme Court found that the existence of such a practice over many years did not excuse the forwarder. In fact, the court treated the practice as a factor supporting liability: the forwarder followed a known pattern without warning the bonded warehouse to require proper documentation (Supreme Court of South Korea, 2024Da270860).\"}}, {\"@type\": \"Question\", \"name\": \"Can I also hold the CEO of the freight forwarder personally liable in South Korea?\", \"acceptedAnswer\": {\"@type\": \"Answer\", \"text\": \"Yes, in certain circumstances. The Supreme Court in 2024Da270860 held that the CEO of a small company who condoned and acquiesced in the practice of passing Master D\/O copies without verifying payment was personally liable for the resulting tort, as the conduct fell within the scope of the CEO's business execution authority.\"}}, {\"@type\": \"Question\", \"name\": \"What governing law applies to a claim against a South Korean freight forwarder for unauthorized cargo release in South Korea?\", \"acceptedAnswer\": {\"@type\": \"Answer\", \"text\": \"South Korean law applies when the unlawful acts were committed in South Korea. In 2024Da270860, the court confirmed that because all of the alleged unlawful acts by the defendant (a Korean freight forwarder) were committed in South Korea, South Korean law governed the claim \u2014 even though the plaintiff was a US company.\"}}], \"@id\": \"https:\/\/atlaw.kr\/en-blog\/destination-freight-forwarder-master-do-liability-south-korea#faq\"}<\/script><\/p>\n<p><script type=\"application\/ld+json\">{\"@context\":\"https:\/\/schema.org\",\"@type\":[\"LegalService\",\"LocalBusiness\"],\"name\":\"Atlas Legal\",\"image\":\"https:\/\/atlaw.kr\/logo.png\",\"url\":\"https:\/\/atlaw.kr\",\"telephone\":\"+82-32-864-8300\",\"address\":{\"@type\":\"PostalAddress\",\"streetAddress\":\"323 Incheon Tower-daero, Tower B, Suite 2901 (Songdo-dong, Centrode)\",\"addressLocality\":\"Incheon\",\"addressRegion\":\"Yeonsu-gu\",\"addressCountry\":\"KR\"},\"priceRange\":\"$$\",\"openingHoursSpecification\":{\"@type\":\"OpeningHoursSpecification\",\"dayOfWeek\":[\"Monday\",\"Tuesday\",\"Wednesday\",\"Thursday\",\"Friday\"],\"opens\":\"09:00\",\"closes\":\"18:00\"},\"areaServed\":[{\"@type\":\"Place\",\"name\":\"Republic of Korea\"},{\"@type\":\"Place\",\"name\":\"Incheon\"},{\"@type\":\"Place\",\"name\":\"Seoul\"},{\"@type\":\"Place\",\"name\":\"Gyeonggi-do\"},{\"@type\":\"Place\",\"name\":\"Songdo International Business District\"},{\"@type\":\"Place\",\"name\":\"Cheongna International City\"},{\"@type\":\"Place\",\"name\":\"Yeongjong International City\"},{\"@type\":\"Place\",\"name\":\"Incheon Free Economic Zone (IFEZ)\"},{\"@type\":\"Place\",\"name\":\"Seoul Metropolitan Area\"}],\"geo\":{\"@type\":\"GeoCoordinates\",\"latitude\":37.399438,\"longitude\":126.629812},\"email\":\"info@atlaw.kr\"}<\/script><\/p>\n<style>\n    body {\n        font-family: Georgia, serif;\n        line-height: 1.6;\n        max-width: 1000px;\n        margin: 0 auto;\n        padding: 20px;\n        background-color: #f9f9f9;\n    }\n    .content-container {\n        background-color: white;\n        padding: 20px;\n        margin: 0;\n    }\n    h2 { font-size: 22px; 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margin: 0; }\n    .entry-content > *:first-child { margin-top: 0 !important; }\n    .entry-content { margin-top: 0 !important; }\n    .kb-row-container, .kb-column-container { margin: 0; padding: 0; }\n<\/style>\n<div class=\"content-container\">\n<p>    <!-- Table of Contents --><\/p>\n<div class=\"toc\">\n<h2>Table of Contents<\/h2>\n<ul>\n<li><a href=\"#section1\">1. What Is a D\/P Transaction \u2014 and Why Did It Fail in This Case?<\/a><\/li>\n<li><a href=\"#section2\">2. Master D\/O vs. House D\/O: The Core Distinction Under South Korean Law<\/a><\/li>\n<li><a href=\"#section3\">3. What Obligations Does a Destination Freight Forwarder Owe Under South Korean Law?<\/a><\/li>\n<li><a href=\"#section4\">4. Why Did South Korea&#8217;s Supreme Court Find the Forwarder Liable?<\/a><\/li>\n<li><a href=\"#section5\">5. Does the One-Year Time Bar Under Commercial Act Article 814 Apply in South Korea?<\/a><\/li>\n<li><a href=\"#section6\">6. Can the CEO Be Personally Liable in South Korea?<\/a><\/li>\n<li><a href=\"#section7\">7. FAQ<\/a><\/li>\n<\/ul><\/div>\n<p>    <!-- Story Hook --><\/p>\n<div class=\"story-hook\">\n<p><strong>Hypothetical scenario:<\/strong> A US exporter shipped walnuts to a South Korean importer under D\/P (Documents against Payment) terms \u2014 meaning the importer had to pay the collecting bank before receiving the shipping documents, including the House Bill of Lading. The cargo arrived at Busan Port. But the South Korean destination freight forwarder passed a copy of the Master Delivery Order to the importer without confirming payment. The bonded warehouse released the cargo without requiring a House D\/O or the original House B\/L. The importer collected the goods without paying a cent. Who bears legal responsibility \u2014 and under what theory?<\/p>\n<\/p><\/div>\n<p>    <!-- Direct Answer --><\/p>\n<div class=\"direct-answer\">\n        <strong>Direct Answer:<\/strong> The Supreme Court of South Korea ruled on August 14, 2025 (2024Da270860) that a destination freight forwarder in South Korea that passed a Master D\/O copy to the importer without verifying payment unlawfully infringed the bill of lading holder&#8217;s rights, constituting a tort under South Korean law. The forwarder company and its CEO were both held liable for damages.\n    <\/div>\n<p>    <!-- Story Development --><\/p>\n<div class=\"story-detail\">\n<h3>A Common Practice \u2014 and a Serious Legal Risk<\/h3>\n<p class=\"disclaimer\">\u203b The scenario above is a hypothetical illustration based on the facts of the Supreme Court ruling described below.<\/p>\n<p>In short-haul trade, cargo often arrives before the original bill of lading reaches its destination. To avoid demurrage, forwarders sometimes skip the House B\/L surrender process and pass the Master D\/O directly to the importer. South Korea&#8217;s Supreme Court addressed this practice directly in its August 2025 ruling. A US exporter had shipped goods to a Korean importer under D\/P terms. The Korean destination freight forwarder \u2014 acting as the local partner for a US-based shipping forwarder \u2014 passed the Master D\/O copy to the importer without verifying that payment had been made to the collecting bank. The bonded warehouse released the cargo without a House D\/O. The court held that both the freight forwarder and its CEO had committed a tort against the bill of lading holder.<\/p>\n<\/p><\/div>\n<p>    <!-- Section 1 --><br \/>\n    <\/p>\n<h2 id=\"section1\">1. What Is a D\/P Transaction \u2014 and Why Did It Fail in This Case?<\/h2>\n<p>Understanding D\/P (Documents against Payment) payment terms is essential to grasping why the destination freight forwarder&#8217;s conduct was found to be unlawful.<\/p>\n<h3>How D\/P Works: The Two-Layer Safety Mechanism<\/h3>\n<p>In a D\/P transaction, &#8220;documents&#8221; refers to the full set of shipping documents \u2014 the House Bill of Lading (House B\/L), Commercial Invoice, Packing List, and any other documents required for import clearance. The House B\/L is the most critical piece because it is a document of title: only the person who presents the original House B\/L to the carrier can take delivery of the cargo.<\/p>\n<p>The D\/P process works as follows. After shipment, the exporter deposits the shipping documents with its remitting bank (Remitting Bank) with instructions to release the documents only upon payment. The remitting bank forwards the documents and a collection instruction to the importer&#8217;s collecting bank (Collecting Bank). The collecting bank holds the documents and releases them only after the importer pays in full. Once the importer pays and receives the original House B\/L, it presents that document to the destination freight forwarder, which then issues a House D\/O authorizing the bonded warehouse to release the cargo.<\/p>\n<p>This creates two layers of protection for the exporter: the importer cannot get the House B\/L without paying, and without the House B\/L, the importer cannot get the cargo. In this case, the actual collection instruction read: &#8220;Documents may be delivered to [the importer] after payment of the purchase price has been received (DELIVER DOCUMENTS AGAINST PAYMENT).&#8221; The destination forwarder bypassed both layers by handing the Master D\/O copy directly to the importer.<\/p>\n<h3>The Parties in the 2024Da270860 Case<\/h3>\n<table>\n<tr>\n<th>Party<\/th>\n<th>Role<\/th>\n<th>Nationality<\/th>\n<\/tr>\n<tr>\n<td>X (Plaintiff)<\/td>\n<td>Exporter (walnut producer and seller)<\/td>\n<td>US corporation<\/td>\n<\/tr>\n<tr>\n<td>A (Importer)<\/td>\n<td>Buyer \/ importer<\/td>\n<td>Korean corporation<\/td>\n<\/tr>\n<tr>\n<td>Y1 (Defendant 1)<\/td>\n<td>Destination freight forwarder \/ domestic partner for the US shipping forwarder<\/td>\n<td>Korean corporation<\/td>\n<\/tr>\n<tr>\n<td>Y2 (Defendant 2)<\/td>\n<td>CEO of Y1<\/td>\n<td>Korean national<\/td>\n<\/tr>\n<\/table>\n<p>The cargo \u2014 two shipments of walnuts totaling approximately USD 197,650 \u2014 arrived at Busan Port. A never paid. Y1 nonetheless passed the Master D\/O copies to A. The bonded warehouse released the cargo without verifying a House D\/O. X recovered nothing.<\/p>\n<p>    <!-- Section 2 --><br \/>\n    <\/p>\n<h2 id=\"section2\">2. Master D\/O vs. House D\/O: The Core Distinction Under South Korean Law<\/h2>\n<p>The Supreme Court&#8217;s analysis turned on a fundamental distinction between two delivery documents that are frequently confused in practice.<\/p>\n<h3>What Each Document Does<\/h3>\n<p>The court stated: &#8220;A Master D\/O is a delivery order issued by the actual ocean carrier to the freight forwarder after receiving freight, serving as the basis for the forwarder to remove cargo from the terminal. A House D\/O is a delivery order issued by the freight forwarder to the importer only after the importer has completed payment, serving as the basis for the importer to take delivery from the bonded warehouse operator.&#8221;<\/p>\n<table>\n<tr>\n<th>Document<\/th>\n<th>Issued by<\/th>\n<th>Issued to<\/th>\n<th>When issued<\/th>\n<th>Purpose<\/th>\n<\/tr>\n<tr>\n<td>Master D\/O<\/td>\n<td>Ocean carrier<\/td>\n<td>Freight forwarder (Y1)<\/td>\n<td>After freight is paid<\/td>\n<td>Authorizes forwarder to remove cargo from terminal \u2014 NOT a delivery order for the importer<\/td>\n<\/tr>\n<tr>\n<td>House D\/O<\/td>\n<td>Freight forwarder (Y1)<\/td>\n<td>Importer (A)<\/td>\n<td>Only after importer completes payment and surrenders House B\/L<\/td>\n<td>Authorizes importer to collect cargo from bonded warehouse<\/td>\n<\/tr>\n<\/table>\n<h3>Why the Master D\/O Cannot Be Passed to the Importer<\/h3>\n<p>The court was explicit: &#8220;Since the consignee and notifying party of the Master D\/O were both listed as Y1 \u2014 the destination freight forwarder and domestic partner \u2014 the Master D\/O cannot serve as a delivery order to [the importer].&#8221; Passing that document to the importer was not a neutral act. It gave the importer the means to obtain the cargo without paying, and the bonded warehouse used it to do exactly that.<\/p>\n<p>    <!-- Section 3 --><br \/>\n    <\/p>\n<h2 id=\"section3\">3. What Obligations Does a Destination Freight Forwarder Owe Under South Korean Law?<\/h2>\n<p>The Supreme Court confirmed two specific obligations that Y1 breached.<\/p>\n<h3>Obligation to Preserve and Deliver to the Rightful Recipient<\/h3>\n<p>The court held: &#8220;A destination freight forwarder, acting as a performance assistant (\u5c65\u884c\u88dc\u52a9\u8005) of the [originating] freight forwarder, bears the obligation to preserve the imported cargo until customs clearance procedures are completed, and to deliver the cargo to the consignee \u2014 the rightful recipient under the maritime transport contract \u2014 or to a person designated by the consignee.&#8221; This obligation runs until completion of customs clearance, not merely until physical arrival at the port.<\/p>\n<h3>Obligation to Verify Payment by Requiring Surrender of the House B\/L<\/h3>\n<p>The court identified Y1&#8217;s specific duty in concrete terms: &#8220;Y1&#8217;s role and obligation as destination freight forwarder entrusted by [the US shipping forwarder] was to confirm that [the importer] had paid for the goods by requiring [the importer] to surrender the House B\/L, and only then to allow [the importer] to collect the goods.&#8221; The surrender of the House B\/L was the mechanism by which payment would be confirmed \u2014 because the importer could only obtain the House B\/L from the collecting bank after paying.<\/p>\n<p>    <!-- Section 4 --><br \/>\n    <\/p>\n<h2 id=\"section4\">4. Why Did South Korea&#8217;s Supreme Court Find the Forwarder Liable?<\/h2>\n<p>The court&#8217;s reasoning on liability rested on three separate grounds, each independently sufficient.<\/p>\n<h3>Delivering to a Non-Holder of the Bill of Lading Is a Tort<\/h3>\n<p>The court reaffirmed: &#8220;Since maritime cargo must be delivered against surrender of the bill of lading to the holder, when a destination freight forwarder delivers cargo to a person other than the bill of lading holder and thereby makes it impossible to deliver to the holder, this constitutes an unlawful act that illegally infringes the bill of lading holder&#8217;s rights to the cargo&#8221; (citing prior rulings 2004Da12394 and 2016Da276719).<\/p>\n<h3>Passing the Master D\/O Copy Was Itself the Cause<\/h3>\n<p>The court found that even if the bonded warehouse was the entity that physically released the cargo, Y1&#8217;s act of passing the Master D\/O copy was sufficient causation: &#8220;Y1&#8217;s act of passing the Master D\/O copy to the importer was sufficient to constitute the cause enabling the importer to remove the goods from the bonded warehouse without paying.&#8221; The court continued: &#8220;Releasing cargo based solely on a Master D\/O copy is carried out entirely under the joint risk of the bonded warehouse and Y1. If the rights of the legitimate bill of lading holder are infringed as a result, it is appropriate for Y1, as well as the bonded warehouse, to bear liability for damages.&#8221;<\/p>\n<h3>Prior Practice Does Not Excuse the Conduct<\/h3>\n<p>Y1 and A had engaged in this same pattern \u2014 forwarder passing Master D\/O copies, importer collecting without paying \u2014 over many previous transactions. The court treated this not as a defense but as an aggravating factor: Y1 followed the known pattern without alerting the bonded warehouse to require proper documentation, and took no steps to interrupt a practice it knew was improper.<\/p>\n<p>    <!-- Section 5 --><br \/>\n    <\/p>\n<h2 id=\"section5\">5. Does the One-Year Time Bar Under Commercial Act Article 814 Apply in South Korea?<\/h2>\n<p>Y1 and Y2 argued that claims against them were extinguished by the one-year period under Article 814(1) of the South Korean Commercial Act, as well as under the US Carriage of Goods by Sea Act (COGSA) and the House B\/L&#8217;s back-clause terms. The court rejected all three.<\/p>\n<h3>Article 814(1) Requires the Defendant to Be a Maritime Carrier<\/h3>\n<p>Article 814(1) of the South Korean Commercial Act provides: &#8220;The rights and obligations of a carrier toward the shipper or consignee shall be extinguished if no judicial claim is made within one year from the date the carrier delivered or was to deliver the cargo to the consignee, regardless of the cause of action.&#8221; The court confirmed that the lower court had correctly found Y1 to be a destination freight forwarder or domestic partner \u2014 not a maritime carrier or its performance assistant. On that basis, the premise for applying Article 814(1) was not satisfied, and all three arguments based on the one-year period were rejected.<\/p>\n<p>This means that for freight forwarders in South Korea who are not classified as maritime carriers, the one-year Article 814 bar does not automatically apply. The applicable limitations period depends on the nature of the claim and the forwarder&#8217;s legal classification, and requires separate analysis under the Commercial Act&#8217;s freight forwarder provisions and the Civil Act.<\/p>\n<p>    <!-- Section 6 --><br \/>\n    <\/p>\n<h2 id=\"section6\">6. Can the CEO Be Personally Liable in South Korea?<\/h2>\n<p>One of the most practically significant aspects of the ruling is the court&#8217;s affirmation of CEO Y2&#8217;s personal liability.<\/p>\n<h3>Condoning a Wrongful Practice Falls Within Business Execution Authority<\/h3>\n<p>The court held: &#8220;Y2, as CEO of the small company Y1, condoned and acquiesced in the practice between Y1 and [the importer] of passing Master D\/O copies without confirming payment, thereby contributing to the unauthorized removal of the goods. This conduct fell within the scope of Y2&#8217;s business execution authority as CEO of Y1, which is engaged in the freight forwarding business.&#8221; This confirms that a CEO who does not personally direct each transaction but tolerates a systematically wrongful practice can bear personal tort liability under South Korean law \u2014 a meaningful consideration where the company&#8217;s assets may be limited.<\/p>\n<p>    <!-- FAQ --><br \/>\n    <\/p>\n<h2 id=\"section7\">7. FAQ<\/h2>\n<div class=\"faq-section\">\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q1. Under South Korean law, can I sue a destination freight forwarder if it released cargo before the importer paid?<\/div>\n<div class=\"faq-answer\">A. Yes. The Supreme Court of South Korea held in 2024Da270860 that a destination freight forwarder who passed a Master D\/O copy to the importer without verifying payment unlawfully infringed the bill of lading holder&#8217;s rights, constituting a tort. The exporter may claim the full unpaid amount as damages.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q2. What is the difference between a Master D\/O and a House D\/O in South Korea?<\/div>\n<div class=\"faq-answer\">A. A Master D\/O is issued by the ocean carrier to the freight forwarder to authorize removal of cargo from the terminal. A House D\/O is issued by the freight forwarder to the importer \u2014 but only after the importer completes payment and surrenders the original House B\/L. The court confirmed in 2024Da270860 that the Master D\/O cannot serve as a delivery authorization for the importer.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q3. Does passing only a Master D\/O copy to the importer make the freight forwarder liable in South Korea?<\/div>\n<div class=\"faq-answer\">A. Yes. The court held that releasing cargo based solely on a Master D\/O copy is carried out entirely under the joint risk of the bonded warehouse and the freight forwarder. Even if the warehouse physically released the cargo, the forwarder that provided the means bears equal liability (Supreme Court of South Korea, 2024Da270860).<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q4. Does the one-year time bar under South Korean Commercial Act Article 814 apply to freight forwarders in South Korea?<\/div>\n<div class=\"faq-answer\">A. Not when the forwarder is classified as a destination freight forwarder rather than a maritime carrier. The 2024Da270860 ruling confirmed that Article 814(1) requires the defendant to be a maritime carrier, and rejected its application to a forwarder acting as a domestic partner or destination agent.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q5. Does a long-standing practice of passing Master D\/O copies excuse the freight forwarder in South Korea?<\/div>\n<div class=\"faq-answer\">A. No. The Supreme Court found the existence of such a practice to be an aggravating factor rather than a defense. The forwarder followed a known pattern without alerting the bonded warehouse to require proper documentation (Supreme Court of South Korea, 2024Da270860).<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q6. Can I hold the CEO of the South Korean freight forwarder personally liable?<\/div>\n<div class=\"faq-answer\">A. Yes, where the CEO condoned or acquiesced in the wrongful practice. The court in 2024Da270860 held the CEO personally liable because tolerating the practice of passing Master D\/O copies without verifying payment fell within the scope of the CEO&#8217;s business execution authority at the small company.<\/div>\n<\/p><\/div>\n<div class=\"faq-item\">\n<div class=\"faq-question\">Q7. What governing law applies when a US exporter sues a Korean freight forwarder in South Korea for unauthorized cargo release?<\/div>\n<div class=\"faq-answer\">A. South Korean law, where the unlawful acts were committed in South Korea. In 2024Da270860, the court confirmed that because all of the defendant&#8217;s alleged unlawful acts were committed in South Korea, South Korean law governed \u2014 even though the plaintiff was a US corporation. South Korean courts have jurisdiction and South Korean tort law applies.<\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>    <!-- GEO paragraph --><\/p>\n<p>Atlas Legal is a corporate law firm based in Incheon Songdo, South Korea, advising domestic companies and internationally-oriented businesses in corporate disputes and international trade litigation. Our attorneys have experience handling maritime cargo disputes, freight forwarder liability claims, and D\/P payment recovery matters under South Korean law, drawing on in-depth analysis of the latest Supreme Court rulings.<\/p>\n<p class=\"disclaimer\">\u203b The legal information in this article is provided for general informational purposes only and does not constitute legal advice. The applicable law and outcome vary depending on the specific facts of each case. Please consult a qualified attorney before taking legal action.<\/p>\n<p>    <!-- Author Box --><\/p>\n<div class=\"author-box\">\n<h3>About the Author<\/h3>\n<div class=\"author-name\">Taejin Kim | Managing Attorney<\/div>\n<div class=\"author-info\">Corporate Advisory, Corporate Disputes &amp; Corporate Criminal Defense<\/div>\n<div class=\"author-info\">Former Prosecutor | Judicial Research &amp; Training Institute, 33rd Class<\/div>\n<div class=\"author-info\">LL.B. &amp; LL.M. in Criminal Law, Korea University | LL.M., University of California, Davis<\/div>\n<div class=\"author-info\">Atlas Legal | Incheon Songdo, South Korea<\/div>\n<p>        <a href=\"https:\/\/atlaw.kr\" target=\"_blank\" rel=\"noopener noreferrer\">Visit Atlas Legal<\/a>\n    <\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Table of Contents 1. What Is a D\/P Transaction \u2014 and Why Did It Fail in This Case? 2. Master D\/O vs. House D\/O: The Core Distinction Under South Korean Law 3. What Obligations Does a Destination Freight Forwarder Owe Under South Korean Law? 4. Why Did South Korea&#8217;s Supreme Court Find the Forwarder Liable?&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_kadence_starter_templates_imported_post":false,"_kad_post_transparent":"default","_kad_post_title":"default","_kad_post_layout":"default","_kad_post_sidebar_id":"","_kad_post_content_style":"default","_kad_post_vertical_padding":"default","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"_kad_post_classname":"","footnotes":""},"categories":[223,15,220,691],"tags":[654,653,651,652,648],"class_list":["post-761","post","type-post","status-publish","format-standard","hentry","category-corporate-disputes","category-corporate","category-intl-transactions","category-logistics-maritime","tag-bill-of-lading-south-korea","tag-d-p-payment-export","tag-freight-forwarder-liability-south-korea","tag-master-d-o-unauthorized-release","tag-south-korea-maritime-law"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Freight Forwarder Liability for Unauthorized Cargo Release in South Korea | Atlas Legal<\/title>\n<meta name=\"description\" content=\"South Korea&#039;s Supreme Court ruled a destination freight forwarder liable for passing a Master D\/O to the importer without verifying D\/P payment. 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