When a Korean customer enters court-supervised rehabilitation, an overseas supplier needs to make two decisions at once: how to protect existing receivables and whether to accept further orders.

Start with the Korean court documents. An application, an interim order, and a decision commencing rehabilitation are different events. The applicable restrictions and the claim timetable should be confirmed from the actual case record.

1. Build a receivables timeline

Prepare a schedule showing each order, delivery, invoice, due date, payment, and dispute. Add the rehabilitation application and commencement dates when confirmed. The legal basis and timing of a claim matter; the invoice date alone may not determine its classification.

Claims arising from a cause preceding commencement generally fall within rehabilitation claims under Article 118 of the Debtor Rehabilitation and Bankruptcy Act, or DRBA. However, the Act contains important exceptions. Article 179 includes specified claims relating to continued supply and goods supplied in the ordinary course within 20 days before the application. Qualifying claims may be common-benefit claims, a category entitled to different treatment. DRBA, Articles 118 and 179.

The practical question is therefore which category applies to each receivable, rather than whether the supplier's entire account belongs in one category.

2. Check both the court's list and the filing deadline

Obtain the commencement order, the filing timetable, and the relevant creditor list. Confirm the creditor's legal name, claim amount, currency, basis, and any security.

Article 151 treats rehabilitation claims entered in the statutory list as filed. That rule makes checking the list essential: a supplier should not assume that an entry is complete or accurate, or rely solely on an informal assurance from the customer's commercial team. Where a filing or correction is needed, it should be made within the applicable timetable. DRBA, Articles 147–151.

If a deadline has already passed, obtain advice promptly on late filing. The statutory relief has conditions and procedural limits. Being an overseas creditor does not itself guarantee acceptance. Unprotected rehabilitation claims can face serious consequences when a rehabilitation plan is approved. DRBA, Articles 152–153 and 251.

3. Separate new supply decisions from old debt collection

Common-benefit claims are generally payable outside the rehabilitation plan and have priority over rehabilitation claims and secured rehabilitation claims. That priority does not guarantee that the customer has sufficient money to pay. DRBA, Article 180.

Before accepting new orders, confirm who is authorized to place them, the legal treatment of the resulting claim, and the payment arrangements. Depending on the contract and circumstances, the commercial review may include advance payment, a shorter credit period, or a lower credit limit.

Keep the record of new orders distinct from the pre-existing account. Avoid treating a promise of continued business as a substitute for assessing the old debt's recovery prospects.

4. Review termination, set-off, and enforcement before acting

Where both parties have outstanding performance obligations at commencement, Article 119 may give the administrator a choice concerning performance or termination. The existing contract and its status need to be reviewed before the supplier stops performance or relies on an insolvency termination clause.

Commencement also affects enforcement based on rehabilitation claims and secured rehabilitation claims. Set-off is subject to statutory conditions, deadlines, and prohibitions. A credit note or accounting entry should not be used as a substitute for checking whether a legally effective set-off is available. DRBA, Articles 58, 119 and 144–145.

Documents to collect immediately

• The court order, notices, case number, and administrator's contact details.
• Contracts, purchase orders, delivery and acceptance records, and invoices.
• A reconciled statement of account and correspondence about disputed items.
• Guarantees, security documents, and any relevant insurance information.
• Documents concerning pending litigation or arbitration.

Assign one person to monitor Korean notices and coordinate with finance and sales. The immediate objective is to establish the filing position and make a documented decision on future exposure. Recovery estimates can then be assessed against the case information and the proposed plan.

Related services: Restructuring and Insolvency and International Transactions and Disputes.

This article provides general information on Korean law as reviewed on September 29, 2026. Filing dates and procedural options must be confirmed for the specific case.