Secretly Profiting from State Land.. Is It Still a Win Even When Caught? Absurd Reduction of Penalties

This is a private parking lot near Gimhae International Airport in Busan.

This 507-square-meter site, equivalent to about 150 pyeong, is state-owned land.

It was found that the business had been paying lease fees for only about 70 square meters of this state land.

The remaining 437 square meters were illegally occupied and used for business operations for at least five years without any contract.

[Illegal Occupant : The lower part of that area was a construction zone during past road works. I thought they were only charging rent for the parts excluding that area. So I thought it was twenty pyeong....]

Korea Asset Management Corporation (KAMCO), which is responsible for managing state-owned land, confirmed the illegal occupation in January and imposed a penalty of approximately 133 million won.

However, when the business owner requested a reduction on the grounds of being a small business owner, the penalty was slashed to about one-third of the original amount.

KAMCO cited a Ministry of Economy and Finance notice enacted in 2020 as the basis for the decision.

The relevant notice allows the lease fees for state-owned land to be lowered from 3% to 1% of the property value to ease the burden on small business owners, with reductions capped at up to 20 million won per year.

However, because penalties are calculated based on these reduced lease fees, even illegal occupants ended up receiving the benefits.

Last year, the Board of Audit and Inspection announced that 79,000 parcels, or 10% of all state-owned land managed by KAMCO, were illegally occupied. However, KAMCO does not separately track how much penalties have been reduced through this method.

[Park Min-gyu / National Assembly Political Affairs Committee Member (Democratic Party of Korea) : The problem is that a system created to help struggling small business owners has led to unfair penalty reductions for illegal occupiers of state land.]

KAMCO maintains that reducing penalties is necessary to encourage illegal occupants to clear the unauthorized occupation and switch to regular contracts.

The Ministry of Economy and Finance stated that lowering penalties even for illegal occupants does not align with the public sense of justice, and announced plans to raise the standards for calculating penalties and re-examine the imposition criteria.

[Exclusive] Illegally Occupied State Land… Penalties Reduced Too? (October 20, 2026, 8 News)

Reported by Lee Tae-kwon | Produced by Choi Yoon-seo | Filmed by Lee Byung-joo | Edited by Cho Mu-hwan | Design by Kang Yoon-jung | Produced by SBS Digital News
※ Please note: This article was translated by AI and may contain errors.