Changes to South Korea’s Employee Retirement Benefit Security Act (ERSA) passed parliament in March 2021, and an enforcement decree was disseminated on 22 Apr 2021. The reforms, which include increased minimum funding requirements for defined benefit (DB) plans and new reporting and governance requirements for pension providers, generally will take effect on 14 Apr 2022.
Other pension reforms flagged in the original bill were not included in the final act and include the mandatory adoption of DB or defined contribution (DC) plans, the introduction of a default investment option for DC plans, linking the pension provider’s fee to the services provided and plan performance, and the introduction of trust-based pension management.
by Julia Lee
Senior Associate, Mercer Wealth
by Fiona Webster
Principal, Mercer’s Law & Policy Group
by Stephanie Rosseau
Principal, Mercer’s Law & Policy Group