Welcoming Remarks
by H.E. Cho Tae-yul Vice Minister for Foreign Affairs of the Republic of Korea
at the 3rd APEC International Conference on Enforcing Contracts

October 30, 2013
Seoul, Korea

Minister Hwang Kyo-ahn,
Minister Cha Han-sung,
Acting President Nguyen Dinh Cung,
Permanent Secretary Yahya Bin Haji Idris,
President Ibrahim Bin Abdullah Al Matroudi,
Distinguished Guests,
Ladies and Gentlemen,

I would like to warmly welcome all of you to the 3rd APEC International Conference on Enforcing Contracts.

Enforcing contracts which is one of the five priority areas of the APEC Ease of Doing Business (EoDB) Initiative requires significant technical expertise. Korea, a top performer in the enforcing contracts indicator of World Bank, was selected as a champion economy to lead the efforts in this area. It is for this reason that we are especially pleased to host this important conference in Seoul.

Enforcing contracts is also an area of my personal interest as I had the opportunity to take part in the international efforts to improve the credibility of the WTO dispute settlement system as Chairman of the WTO panel for the EC-hormones dispute, a well-known trade dispute between the U.S. and the EU.

I am confident that this conference will provide an excellent opportunity to share our experiences and to seek together the future direction of an effective system for enforcing contracts.

Distinguished guests,

An ancient Roman proverb says, “The law always abhors delays.” This proverb points to an attribute of law that always aims to change an uncertain situation into a certain one as quickly as possible. It is also an epigram that emphasizes the need for carrying out legal proceedings swiftly. This may be a 2,000-year old proverb but its significance is more valuable today, given the greater number of players in the market and the complexity of the economic activities.

According to a World Bank report, inefficient civil or commercial dispute resolution mechanisms incur serious economic losses to businesses and the economy as a whole. Companies facing legal suits fall victim to uncertainty, making it difficult for them to actively pursue their entrepreneurial spirit.

On the other hand, legal proceedings that are fast, impartial and transparent help to promote the stability of business activities and secure their legal rights. And improving the predictability of economic behavior will also build trust in the markets.

Many studies point out that emerging economies, more than developed economies, will enjoy greater benefits from the improvements made in enforcing contracts. This is because the small and medium sized companies in developing countries that cannot withstand the exorbitant costs of prolonged legal proceedings will benefit the most. In addition, a more stable legal regime in developing countries will attract greater foreign investment.

As you may know, enforcing contracts is the most difficult area to make tangible progress out of the five key areas of the APEC Ease of Doing Business Initiative. This is because improvements in the civil and commercial legal proceedings essentially mean substantial upgrade of legal system backed by technological progress and a new social compact.

However, this also implies that there are greater benefits to reap from such systemic improvements. A more effective dispute settlement mechanism will enable businesses to exercise a more ambitious entrepreneurial spirit. This in turn will create jobs, increase production, and attract foreign investment, which will pave the way for greater opportunities to participate in the global value chain.

Ladies and Gentlemen,

In a span of only five decades, Korea has been able to become a democratic and industrialized nation. To meet the demands of a more advanced economy, the system for enforcing contracts has been upgraded in parallel. Today, Korea ranks second in terms of enforcing contracts, and seventh on the World Bank’s Doing Business Index.

Behind this achievement lies the Korean Government’s commitment to help strengthen the competitiveness of Korean companies by introducing global standards while protecting their legal rights. It is also the consequence of harmonizing tangible assets, such as an electronic case filing system which makes use of the advanced IT and infrastructure, with intangible assets such as the Korean people’s attitude to get things done quickly.

Building on such experiences and assets, Korea has been pursuing phase two of the APEC Ease of Doing Business capacity building program in the field of enforcing contracts since 2011. We have been working together with partner economies, including Indonesia, Peru, Thailand, The Philippines, Brunei and Vietnam, to examine their corporate legal environments and advice on ways to improve them.

Such efforts have given way to the enactment of the Civil Proceedings Act in Indonesia last year. Mexico expressed its interest in sharing Korea’s experiences, while Saudi Arabia has been invited to this program as a non-APEC partner economy this year. As such the capacity building program for enforcing contracts has been gradually making progress.

Currently, these emerging countries are the key drivers of the APEC region and will continue to grow to lead the global economy in the future. Korea places great value on the cooperative relationship with these countries. We are committed to sharing our experiences on enhancing legal stability that will promote the dynamism and potential of the businesses.

Distinguished guests,

Just as economic activities of businesses are led by the ‘invisible hand’, enforcing contracts is the ‘visible hand’ that protects the legal rights of businesses. The faster, easier and cheaper such government services are, the greater welcome will they receive from businesses.

Korea, as a champion economy in the field of enforcing contracts, is pleased to join efforts to build the infrastructure of trust in the market economy and is committed to promoting the shared prosperity of all the companies in the region.

I hope you will enjoy your stay in Korea. I also wish to thank all those who took part in the preparations of this conference. And I hope today’s conference will contribute to stimulating the creativity of companies in the APEC region.

Thank you.