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Land, buildings & compensation

Factory and Business Relocation Cost Compensation — Business Facility Relocation Costs vs. Moving Expenses, Claim Documents

When a factory or business must move because of a public works project, buildings and structures fixed to the land are compensated with the costs needed to relocate them, but they are compensated at the price of the object if relocation is difficult or the relocation cost exceeds the object's price (Act on the Acquisition of and Compensation for Land for Public Works Projects, the Land Compensation Act, Article 75(1)). Relocation costs and the depreciation equivalent for business facilities, raw materials, products, and goods are assessed as business loss items (Enforcement Rule, Article 47(1)2), while moving expenses for residents of residential buildings are calculated separately under Annex 4 (Enforcement Rule, Article 55(2)). Since relocation costs are set by consultation after the project operator prepares the records and appraisal, the relocation volume should be matched with supporting materials from the object record inspection stage.

Written by Hwang Yunsang, Administrative Agent · Published 2026-10-25 · Updated 2026-10-25

Procedure

Procedure type
  • Application Difficulty Medium

    An application for a subsidy, benefit, compensation or decision. The authority reviews whether the payment or selection criteria are met and then decides.

We will prepare land compensation consultation opinions and application/opinion documents related to expropriation decisions and objection decisions. This service does not include the entire appraisal and compensation negotiation.

Scope & fee
Documents for the consultation stage
We will prepare a consultation opinion by organizing the provided records and factual data for 1 land compensation case. Appraisal and on-site negotiation are not included. Scope of writing: 1 type of consultation opinion, 5 pages per type. It does not include in-office submissions.
Documents for the expropriation adjudication
We will prepare an application, opinion, and evidence related to the decision of 1 land expropriation case. The legal submission subject and claim route are confirmed, and appraisal and subsequent objection resolution are separate. Scope of writing: 1 type of acceptance decision application/opinion/5 pages per type. It does not include in-office submissions.
Documents for the objection adjudication
We will review the results of the acceptance decision and the grounds provided, and prepare application/opinion documents related to the objection decision. Preliminary consultation, new acceptance documents, and appraisal are not included. Scope of writing: 1 type of objection resolution application/opinion, 5 pages per type. It does not include in-office submissions.

  1. 1. Separate the legal basis for each compensation item

    Objects fixed to the land, such as buildings and structures, are compensated with relocation costs (Land Compensation Act, Article 75(1)). When a business location is moved, the costs of relocating business facilities, raw materials, products, and goods and the depreciation equivalent are included in business loss (Enforcement Rule, Article 47(1)2), and other movable property not covered by moving expenses is compensated with relocation costs and the depreciation equivalent (Enforcement Rule, Article 55(1)). Organize the applicable item for each object so that nothing is counted twice or left out of every item.

  2. 2. Check what is included in relocation costs

    Relocation cost means the cost of moving or reinstalling an object outside the public works project area while maintaining its usefulness, including dismantling costs, construction costs including the expenses generally needed for a building permit, and transport costs up to a reasonable distance (Enforcement Rule, Article 2, Item 4). Costs of improving facilities required by related laws such as the Building Act are excluded. Check whether the dismantling and reinstallation of attached facilities such as foundations, electrical upgrades, piping, dust collection, and cooling equipment, not only the machine bodies, is reflected.

  3. 3. Compare the object record and file objections within the inspection period

    When the compensation plan is announced and notified, compare the type, structure, specifications, and quantity of machinery and equipment in the object record with the site within the inspection period of at least 14 days (Land Compensation Act, Article 15(2); Enforcement Decree, Article 7(4)). File a written objection with the project operator within the inspection period for omitted or incorrect items (Article 15(3)).

  4. 4. Prepare supporting materials for the relocation volume

    After comparing the object record with the site, organize photos, nameplates, specifications, weight, and quantity for each object, and based on them prepare the load volume, the number of vehicles needed, and itemized quotes for dismantling, transport, and reinstallation. For raw materials, products, and goods, prepare inventory quantities and materials showing possible damage during relocation. These materials become the basis for item-by-item comparison with the appraisal details at the consultation stage.

  5. 5. Submit consultation opinions and request adjudication

    During the consultation period in the compensation consultation request (at least 30 days unless there are special reasons), compare the appraisal details item by item and submit an opinion statement on omitted or undervalued items (Enforcement Decree, Article 8(3)). If consultation fails after the public notice of project approval, after the consultation period ends submit a written request for adjudication to the project operator in person or by certified mail (Enforcement Decree, Article 14(1); Enforcement Rule, Article 12). The project operator must apply to the competent land tribunal for adjudication within 60 days of receiving the request (Land Compensation Act, Article 30(2)).

Required documents

  • Objection to the object record and compensation opinion statement (no prescribed form; record objections are filed in writing under Land Compensation Act, Article 15(3))
  • Written request for adjudication if consultation fails (including the items in Enforcement Decree, Article 14(1))
  • Compensation plan notice and copy of the object record, or item-by-item inspection notes
  • List of machinery and equipment (nameplate, specifications, weight, quantity, installation location) with overall and detailed photos
  • Itemized quotes for dismantling, transport, and reinstallation
  • Equipment purchase and installation contracts, tax invoices, and construction payment records
  • Inventory list of raw materials, products, and goods
  • Business permit documents and business registration certificate, plus the lease contract for leased premises

Fees

Administrative service fee
  • Documents for the consultation stage from KRW 600,000
  • Documents for the expropriation adjudication from KRW 500,000
  • Documents for the objection adjudication from KRW 500,000
All administrative service fees exclude 10% VAT.

The adjudication application fee is paid by the project operator who applies for adjudication (Land Compensation Act, Articles 28(2) and 30(2)); the client bears actual costs such as quote preparation, certificate fees, and postage. Our office fee starts from the amount shown above and may vary depending on the type and quantity of factory equipment and the scope of photo and quote materials to organize; we will give you an exact quote after reviewing your documents.

See fees and official charges for this service →

Legal basis and review date

  • Act on the Acquisition of and Compensation for Land for Public Works Projects, Article 15
  • Act on the Acquisition of and Compensation for Land for Public Works Projects, Article 28
  • Act on the Acquisition of and Compensation for Land for Public Works Projects, Article 30
  • Act on the Acquisition of and Compensation for Land for Public Works Projects, Article 75
  • Act on the Acquisition of and Compensation for Land for Public Works Projects, Article 77
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Decree, Article 7
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Decree, Article 8
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Decree, Article 14
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Rule, Article 2
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Rule, Article 12
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Rule, Article 45
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Rule, Article 47
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Rule, Article 55
  • Act on the Acquisition of and Compensation for Land for Public Works Projects Enforcement Rule, Annex 4

Checked against the statutes on

Statutes and public notices change, so each case needs to be checked individually. Statute titles are given in English for reference. The Korean statutes are the authoritative text.

Check these first

  • If equipment is dismantled or removed first, it becomes hard to prove items omitted from the object record, so keep photos and records of nameplates, specifications, quantities, and installation locations for each object before relocation.
  • For business facility relocation costs to be included in business loss compensation, a business that requires a permit must have obtained it before the public notice of project approval and be operating as permitted (Enforcement Rule, Article 45, Item 2), so first check that factory registration and permit details match the actual business.

Frequently asked questions

How are factory relocation costs different from moving expenses?
They differ in scope and legal basis. Moving expenses cover transporting household goods and other movables of residents of residential buildings and are calculated under Annex 4 (Enforcement Rule, Article 55(2)), while relocating a factory's business facilities, raw materials, products, and goods is a business loss item assessed as relocation costs plus the depreciation equivalent (Enforcement Rule, Article 47(1)2).
How are moving expenses for public works projects calculated?
They are calculated by adding wages for a set number of workers, vehicle fares, and packing costs according to the floor area of the home. Under 33 square meters it is 3 ordinary laborers' wages and 1 truck fare, at 99 square meters or more it is 8 laborers' wages and 4 truck fares, and packing costs are 0.15 times the total of wages and vehicle fares (Enforcement Rule, Annex 4). The vehicle fare is based on the 8-hour daily fare of a truck with a maximum load of 5 tons.
What happens if the cost of moving a machine exceeds its price?
If the relocation cost exceeds the price of the object, it is compensated at the price of the object (Land Compensation Act, Article 75(1)2). It is also compensated at its price when relocation is difficult or the object cannot be used for its original purpose after relocation (Item 1 of the same paragraph).
Can a leased factory receive business facility relocation costs?
Yes, if it meets the requirements for business loss compensation. The business must have been operated continuously with personnel and physical facilities at a lawful place since before the public notice of project approval, and a tenant operating in an unauthorized building must have registered the business at least 1 year before that date (Enforcement Rule, Article 45, Item 1). For such a tenant, the compensation excluding relocation costs for business facilities cannot exceed 10,000,000 won, but relocation costs are excluded from this cap (Enforcement Rule, Article 47(6)).
How long a business suspension period is recognized for a factory move?
In principle, up to 4 months. If relocation within 4 months is objectively recognized as difficult because the facilities are large or require high precision to move, the actual suspension period applies, but it cannot exceed 2 years (Enforcement Rule, Article 47(2)). Materials showing the equipment scale and relocation process are the basis for this decision.
Are costs of upgrading facilities to legal standards at the new factory included in relocation costs?
No. Relocation costs include dismantling, construction, and transport up to a reasonable distance, but exclude costs of improving facilities required by related laws such as the Building Act (Enforcement Rule, Article 2, Item 4).
Can I hand factory relocation compensation documents over to an administrative agent?
Yes, you can entrust organizing relocation volume materials and preparing objections, opinion statements, and adjudication requests. Hwang Yunsang Administrative Office compares the object record with the equipment on site, organizes the relocation volume with photos, specifications, quantities, and quotes, and prepares the objection within the inspection period and opinion statements for the consultation stage. If consultation fails, we prepare and file the written request for adjudication on your behalf; the compensation appraisal is carried out by the appraisal body commissioned by the project operator, and we prepare opinion statements on its results.

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Hwang Yunsang Administrative Office in Songdo, Incheon prepares and submits administrative documents and explains the procedure. If your situation is similar, send us a message.

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📍 2697, 26F POSCO Tower-Songdo, 165 Convensia-daero, Yeonsu-gu, Incheon, Republic of Korea · 📞 010-3374-2687 · 🌐 hwangadmin.com

This guide is general information based on public sources. Requirements, documents and deadlines differ by case and by the competent agency, so please confirm them before you proceed.