Shareholder Derivative Suit & Director Liability Calculator

Shareholder Derivative Suit & Director Liability Calculator helps estimate Korea-related civil dispute, damages, evidence, settlement, and legal-cost assumptions in English.

Legal scenario inputs

Enter Korea-related court, traffic, debt, family, civil, medical-dispute, criminal, or real-estate dispute assumptions. Results are simplified planning estimates.

Civil claim recognized amount

₩1,500,000,000

Offset or paid amount

₩200,000,000

Net planning amount

₩1,300,000,000

Monthly planning amount

₩108,333,333

₩1,500,000,000 unrecovered

Under the Korean Commercial Act a director who breaches statutes/articles or neglects duties is jointly liable to the company (art. 399). The articles of incorporation may cap liability at 6x (3x for outside/independent directors) of the last year of compensation for the portion in excess (art. 400(2)), except for intent, gross negligence, or competition/self-dealing/corporate-opportunity breaches. A 1% shareholder — 0.01% held for 6 months at listed firms (art. 542-6(6)) — may bring a derivative suit (art. 403); the suit value is fixed at KRW 100 million, so the first-instance stamp fee is KRW 455,000 regardless of the claim size. Korea-based 2026 rules; this is an estimate, not legal advice.

Related calculators

What is the Shareholder Derivative Suit & Director Liability Calculator?

This calculator estimates three numbers a minority shareholder needs when holding a director accountable for harming the company under the Korean Commercial Act.
First, the size of the director’s liability to the company and the cap available through the articles of incorporation; second, the ownership threshold a shareholder must meet to bring a derivative suit; third, the court filing costs (stamp fee and service fee) of actually suing.
Every figure follows the 2026 Korean Commercial Act and the Act and Rules on Stamps in Civil Litigation, mirrored from the National Law Information Center.

The most important feature is the cost structure.
A derivative suit is treated as a claim whose value cannot be calculated, so the suit value is fixed at KRW 100 million.
As a result, even if you claim tens of billions of won in damages against a director, the first-instance stamp fee stays at KRW 455,000 regardless of the claim amount — which is exactly why a small shareholder can pursue a very large liability at low cost.

Korea-specific disclaimer: This calculator is based entirely on Korean law — the Commercial Act (Arts. 399, 400, 401, 403, 406-2, 542-6), the Act on Stamps in Civil Litigation (Arts. 2, 3), and the Rules on Stamps in Civil Litigation (Arts. 15, 18-2).
It is a reference estimate for 2026 rules only and does not replace advice from a Korean attorney, a court decision, or a case-specific review. Recognized damages and any liability reduction are decided by the court on the facts of each case.

Who is this for?

  • • Companies and minority shareholders harmed by a director’s breach of duty or self-dealing
  • • Shareholders checking whether they meet the ownership and holding-period thresholds for a derivative suit
  • • Directors and auditors who want to know the size of their liability and the articles-based cap
  • • Plaintiffs and defendants estimating stamp and service fees before filing
  • • Parent-company shareholders considering a multiple derivative suit against a subsidiary’s director
  • • Legal, IR, and governance staff working on shareholder-activism matters

Director Liability to the Company (Commercial Act Art. 399)

If a director, intentionally or negligently, violates statutes or the articles of incorporation or neglects their duties, the director is jointly and severally liable to the company for the resulting damage.
A director who voted for a board resolution causing the harm bears the same liability, and a director who took part in the resolution without recording an objection is presumed to have agreed to it.
So liability may fall not on a single director but on every director involved, on a joint-and-several basis.

Liability to the company vs. to third parties

Liability to the company (Art. 399) arises even from ordinary (slight) negligence.
Liability to third parties (Art. 401) arises only where the director acted with intent or gross negligence.

  • • To the company: intent or any negligence; joint and several (Art. 399)
  • • To third parties: intent or gross negligence only (Art. 401)
  • • Scope: damage to the company with proximate causation to the breach

Three Ways Liability Is Reduced (Art. 400 & case law)

A director’s liability is not automatically fixed at the full loss; it can be reduced through three separate routes, which this calculator shows distinctly.

Route 1: Release by unanimous shareholder consent (Art. 400(1))

With the consent of all shareholders (including non-voting shares), the director’s liability can be fully released.
Because a single dissenting shareholder blocks it, this is rarely usable outside closely held companies.

Route 2: Cap through the articles of incorporation (Art. 400(2))

If the company so provides in its articles, the portion of liability exceeding six times (three times for outside/independent directors) the director’s compensation for the one year before the act may be released.
That compensation includes bonuses and gains from exercising stock options.
In effect, an inside director’s minimum burden is 6x the last year’s pay, and an outside director’s is 3x.

When the cap is excluded (proviso to Art. 400(2))

  • • The director caused the damage by intent or gross negligence
  • • Breach of the non-compete duty (Art. 397)
  • • Usurpation of a corporate opportunity (Art. 397-2)
  • • Self-dealing (Art. 398)

In these cases the cap does not apply and the director bears the full loss.

Route 3: Discretionary limitation by the courts

Korean courts may limit a director’s liability under the principle that damages should be shared fairly and reasonably.
They weigh the circumstances and degree of the breach, whether the director gained a benefit, and the company’s organization and internal controls.
In practice the reduction ranges widely, roughly 20% to 80% depending on the case, so the calculator lets you set an assumed reduction rate to see the estimated recognized amount.

Standing and Procedure for a Derivative Suit (Art. 403)

A derivative suit lets a shareholder sue on the company’s behalf when the company itself will not pursue the director’s liability.
The threshold to sue depends on whether the company is unlisted or listed.

TypeOwnership thresholdHolding periodBasis
Unlisted company1% of total issued sharesNoneArt. 403(1)
Listed company0.01% (1/10,000) of total issued sharesHeld 6 months continuouslyArt. 542-6(6)
Multiple derivative suit (listed)0.5% (50/10,000) of total issued sharesHeld 6 months continuouslyArt. 542-6(7)

Four procedural steps

  1. Written demand: a qualifying shareholder asks the company (auditor) in writing to sue the director.
  2. 30-day wait: if the company does not sue within 30 days of the demand, the shareholder may sue directly.
  3. Immediate filing: if waiting risks irreparable harm, the shareholder may file at once.
  4. Suit preserved: even if the stake later falls below 1% (short of full disposal), the suit remains valid.

A multiple derivative suit lets a shareholder holding 1% (0.5% for listed) of the parent pursue a subsidiary director’s liability.
Such a suit falls under the exclusive jurisdiction of the district court where the subsidiary’s head office is located.

Litigation Cost — Why the Suit Value Is Fixed at KRW 100 Million

A derivative suit, a suit to enjoin a director’s unlawful act, and a suit to enjoin a new share issue are treated as claims whose value cannot be calculated, so the suit value is set at KRW 100 million.
The stamp fee is therefore computed on KRW 100 million no matter how large the actual claim is.

Stamp fee by instance (suit value KRW 100 million)

  • • First instance (complaint): KRW 100M × 0.4% + 55,000 = KRW 455,000
  • • Appeal: 1.5× the first-instance fee = KRW 682,500
  • • Final appeal: 2× the first-instance fee = KRW 910,000

A service fee is added on top: number of parties × 15 rounds × KRW 5,500.
For one plaintiff and one defendant director (two parties), the service fee is KRW 165,000.

Costs on winning or losing (Art. 405)

A shareholder who wins may claim from the company the litigation costs and a reasonable amount of the expenses incurred.
The company that pays then has a right of indemnity against the responsible director or auditor.
If the shareholder loses, they owe the company no damages unless they acted in bad faith.

Frequently Asked Questions

Q. If I claim KRW 10 billion, is the stamp fee proportionally huge?

A. No.
A derivative suit’s value is fixed at KRW 100 million, so the first-instance stamp fee is KRW 455,000 whether you claim KRW 10 billion or KRW 100 billion.
That is how a small shareholder can pursue very large liability.

Q. Does the articles-based cap always apply?

A. Only if the articles contain a cap and the director’s act was ordinary negligence.
Intent, gross negligence, non-compete breach, self-dealing, or corporate-opportunity usurpation exclude the cap, so the director bears the full loss.

Q. Can I file a derivative suit immediately?

A. As a rule you must first demand in writing that the company (auditor) sue, then wait 30 days.
If the company does not sue in that period, you may file directly; and if there is a risk of irreparable harm, you may file at once.

Q. How is the judicial reduction rate set?

A. It is not a statutory figure; the court decides it case by case.
The slider is an assumption for estimating a range, so rely on comparable precedents and an attorney for a real case.

Estimate director liability and derivative-suit costs now

Enter the loss and your shareholding to see liability size, standing, and filing costs on one screen.

Based on the 2026 Korean Commercial Act, with the articles-based cap and the fixed KRW 100 million suit value.