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ENFORCEMENT DECREE OF THE INTER-KOREAN COOPERATION FUND ACT

Presidential Decree No. 13237, Dec. 31, 1990

Amended by Presidential Decree No. 13269, Feb. 1, 1991

Presidential Decree No. 13869, Mar. 6, 1993

Presidential Decree No. 14438, Dec. 23, 1994

Presidential Decree No. 16326, May 24, 1999

Presidential Decree No. 17824, Dec. 30, 2002

Presidential Decree No. 19180, Dec. 14, 2005

Presidential Decree No. 20721, Feb. 29, 2008

Presidential Decree No. 21079, Oct. 10, 2008

Presidential Decree No. 22405, Sep. 27, 2010

 Article 1 (Purpose)
The purpose of this Decree is to provide for the matters delegated by the Inter-Korean Cooperation Fund Act and those necessary for the enforcement thereof. <Amended by Presidential Decree No. 19180, Dec. 14, 2005>
 Article 2 (Financial Resources of Fund)
"Other revenues prescribed by Presidential Decree" in subparagraph 5 of Article 4 of the Inter-Korean Cooperation Fund Act (hereinafter referred to as the "Act") means the following revenues: <Amended by Presidential Decree No. 19180, Dec. 14, 2005>
1. Revenues accruing from the operation and management of the Inter-Korean Cooperation Fund (hereinafter referred to as the "Fund");
2. Revenues accruing from the implementation of inter-Korean exchange and cooperation projects.
 Articles 3 and 4 Deleted.<by Presidential Decree No. 19180, Dec. 14, 2005>
 Article 5 (Entrustment of Administrative Affairs concerning Operation and Management of Fund)
(1) The Minister of Unification shall entrust a financial institution determined by Ordinance of the Ministry of Unification (hereinafter referred to as "Fund Trustee") with administrative affairs concerning the operation and management of the Fund pursuant to Article 7 (2) of the Act. In such cases, the expenses incurred in the management of such affairs shall be borne by the Fund. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005; Presidential Decree No. 22405, Sep. 27, 2010>
(2) In carrying out the administrative affairs entrusted pursuant to paragraph (1), the Fund Trustee shall take necessary measures for the efficient operation of the Fund, and operate and manage it with the care of a good manager, and make reports to the Minister of Unification on important matters. <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
(3) The Fund Trustee may attend a meeting of the Inter-Korean Exchange and Cooperation Promotion Council (hereinafter referred to as the "Council") as prescribed in Article 7 (4) of the Act and state his/her opinion in connection with the affairs concerning the operation and management of the Fund.
(4) Necessary matters concerning important matters referred to in paragraph (2) and procedures for reporting them, etc. shall be determined by Ordinance of the Ministry of Unification. <Newly Inserted by Presidential Decree No. 22405, Sep. 27, 2010>
 Article 6 (Fund Operation Plan)
(1) The Minister of Unification shall establish a Fund operation plan, and obtain approval from the President subject to deliberation by the State Council after undergoing deliberation by the Council each fiscal year. This shall also apply to any amendment to such plan. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005>
(2) The Fund operation plan referred to in paragraph (1) shall include the following matters: <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
1. General provisions concerning the creation and operation plans of the Fund;
2. Fund creation plan by the source of revenues;
3. Fund appropriation plan;
4. Statement of estimated financial status;
5. Statement of estimated financial operation;
6. Other matters necessary for the operation and management of the Fund.
 Article 7 (Procedure of Support, etc. from Fund)
(1) Any person who intends to use the Fund for the purposes referred to in Article 8 of the Act shall submit to the Minister of Unification an application for support, surety, loan, insurance, or loss coverage by the Fund, or acceptance of non-designated currency (hereinafter referred to as "support, etc."). <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005; Presidnetial Decree No. 22405, Sep. 27, 2010>
(2) The Minister of Unification in the receipt of an application for support, etc. by the Fund under paragraph (1) shall determine the provision of support, etc. from the Fund subject to a resolution of the Council for important matters determined by Ordinance of the Ministry of Unification, whereas the Minister of Unification him/herself shall determine the provision of support, etc. for any other matters. <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
(3) The Minister of Unification may have the Fund Trustee submit a report made after examining the adequacy, scale, condition, etc. of the support, etc. of the Fund before he/she determines the support, etc. of the Fund. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005>
(4) The Minister of Unification shall, upon determining whether to provide support, etc. from the Fund under paragraph (2), notify the Fund Trustee thereof. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005>
 Article 8 (Requirements for Provision of Support, etc. from Fund)
The requirements for the provision of support, etc. from the Fund shall be as follows, and other necessary matters concerning the requirements for the provision of support, etc. from the Fund shall be subject to conditions specified by the Fund Operation and Management Rules under Article 20 (hereinafter referred to as "Fund Operation and Management Rules"): <Amended by Presidential Decree No. 21079, Oct. 10, 2008; Presidential Decree No. 22405, Sep. 27, 2010>
1. Loans under subparagraph 3 of Article 8 of the Act shall be granted limitedly to cases where it is deemed necessary by a resolution of the Council, taking into consideration the time to implement inter-Korean exchange and cooperation projects, and other circumstances, or where it is deemed difficult to attain the object of such projects by any loan granted by financial institutions under general conditions;
1-2. Insurances under subparagraph 4 of Article 8 shall be limited to cases where the operation of businesses is impossible due to any of the following non-managerial causes or cases of compensating for losses caused by the suspension of business for a certain length of time:
(a) Confiscation of investments and property in North Korea and infringement of the rights thereto;
(b) The North Korean government's restrictions on exchange transactions or bringing-in and bringing-out of goods, etc.;
(c) Cancellation or non-fulfillment of agreements between the South and North Korean governments;
(d) The South Korean government's measures to carry out obligations under international regulations, such as treaty;
(e) Non-managerial causes save the causes referred to in items (a) through (d), which are announced by the Minister of Unification through a resolution of the Council;
2. The support of funds and coverage of losses to financial institutions under subparagraph 5 of Article 8 of the Act shall be granted limitedly to the following cases:
(a) Where required for supporting expenses incurred in acceptance of currency under Article 10, expenses incurred in exchange transactions, losses incurred by the fluctuation of foreign exchange rates, and other incidental expenses incurred in carrying on exchange services, etc. to facilitate inter-Korean exchange and cooperation;
(b) Where required for supporting the coverage of any interest loss and acceptance of bonds which are incurred in conducting settlement services following cooperation projects in the field of trade or economy;
(c) Where required for subsidizing expenses needed for loans to cooperation projects in the field of trade or economy;
(d) Where required for subsidizing expenses or covering losses incurred in connection with support and loans to cooperation projects in the field of trade or economy;
3. Financing, subsidization of funds and support of projects under subparagraph 6 of Article 8 of the Act shall be limited to cases falling under any of the following items:
(a) Where required for subsidizing expenses incurred for inter-Korean exchange between separated family members, such as the confirmation of life or death and address, correspondences, reunion, etc.;
(b) Where required for subsidizing or financing expenses incurred in conducting a general relief, emergency relief, development support, etc. for North Korean residents for a humanitarian purpose;
(c) Where required for subsidizing expenses incurred in conducting the denuclearization of North Korea;
(d) Where required for subsidizing or financing expenses incurred for a project which aims to form the basis of inter-Korean exchanges and cooperation.
 Article 9 Deleted.<by Presidential Decree No. 22405, Sep. 27, 2010>
 Article 10 (Non-Designated Currency)
"Non-designated currency prescribed by Presidential Decree" in subparagraph 5 of Article 8 of the Act means any currency issued and circulated in North Korea. <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
 Article 11 Deleted.<by Presidential Decree No. 17824, Dec. 30, 2002>
 Article 12 (Fiscal Year of Fund)
The fiscal year of the Fund shall coincide with that of the State. <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
 Article 13 (Opening Fund Account and Separate Accounting Practices of Fund)
(1) The Minister of Unification shall open an Inter-Korean Cooperation Fund account with the Bank of Korea to clarify revenues and expenditures of the Fund.
(2) The Minister of Unification may keep accounting of the Inter-Korean Cooperation Fund account under paragraph (1), which is classified as follows: <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
1. Inter-Korean cooperation account: Fund for uses prescribed in subparagraphs 1 through 5 of Article 8 of the Act, uses prescribed in subparagraph 3 (a), (b) and (d) of Article 8 of this Decree in accordance with subparagraph 6 of Article 8 of the Act, and uses prescribed in subparagraphs 7 and 8 of Article 8 of the Act;
2. North Korea denuclearization account: Fund for uses prescribed in subparagraph 3 (c) of Article 8 of this Decree in accordance with subparagraph 6 of Article 8 of the Act, and uses prescribed in subparagraphs 7 and 8 of Article 8 of the Act.
[This Article Wholly Amended by Presidential Decree No. 21079, Oct. 10, 2008]
 Article 14 (Revenues and Expenditures of Fund)
(1) The revenues of the Fund shall be composed of contributions, borrowings, recovered funds, proceeds under Article 2, funds deposited from the Public Capital Management Fund under the Public Capital Management Fund Act, and other profits accruing from the operation of the Fund. <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
(2) The expenditures of the Fund shall be composed of support funds, loans, funds to accept non-designated currency, redemption of principal and interest, and other expenses for the operation and management of the Fund. <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
 Article 15 (Report on Settlement of Accounts)
(1) The Minister of Unification shall prepare a report on the settlement of accounts of the Fund for each fiscal year and submit it to the Minister of Strategy and Finance after deliberation by the Council by no later than the end of February of the following fiscal year. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 14438, Dec. 23, 1994; Presidential Decree No. 19180, Dec. 14, 2005; Presidential Decree No. 20721, Feb. 29, 2008>
(2) The report on the settlement of accounts referred to in paragraph (1) shall consist of the following documents: <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
1. Summary of the settlement of accounts;
2. Settlement of revenues and expenditures;
3. Financial statements:
(a) Statement of financial status;
(b) Statement of financial operation;
(c) Statement of net asset change;
4. Statement of performance.
 Article 16 (Accounting of Fund)
(1) The Fund Trustee shall settle the accounts of the Fund separately from other accounts of the Export-Import Bank of Korea.
(2) The accounting of the Fund shall follow the provisions of the National Accounting Act. <Amended by Presidential Decree No. 22405, Sep. 27, 2010>
 Article 17 (Fund Appropriation Plan and Report on Results)
(1) Any person who intends to obtain any support, etc. from the Fund shall submit a Fund appropriation plan to the Minister of Unification when he/she applies for support, etc. from the Fund, and if he/she has implemented the project with the support, etc. from the Fund, he/she shall submit a report on the result of Fund appropriation to the Minister of Unification. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005>
(2) Matters necessary for submitting a Fund appropriation plan and reporting Fund appropriation results referred to in paragraph (1) shall be determined by the Fund Operation and Management Rules.
 Article 18 (Redemption of Fund)
(1) If any cause accrues to redeem the disbursed Fund under Article 11 (2) of the Act, the Fund revenue collection officer or the director taking charge of the Fund revenue shall inform the person who is subject to the redemption without delay, and report it to the Minister of Unification, who shall in turn notify the heads of the administrative agencies concerned thereof. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 17824, Dec. 30, 2002; Presidential Decree No. 19180, Dec. 14, 2005>
(2) Matters other than those prescribed by the Act and this Decree, which are necessary for the redemption of the Fund, shall be determined by the Fund Operation and Management Rules.
 Article 19 (Operation of Surplus Funds)
For the purposes of subparagraph 4 of Article 12 of the Act, "other methods prescribed by Presidential Decree" means purchase of securities.
 Article 20 (Fund Operation and Management Rules)
(1) The Minister of Unification shall prescribe the Fund Operation and Management Rules specifying the conditions, procedures, methods, and post-management of support, etc. from the Fund under the Act and this Decree and other matters necessary for the operation and management of the Fund and publicly announce them. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005>
(2) When the Minister of Unification determines the Fund Operation and Management Rules described in paragraph (1), he/she shall table the issue before the Council for resolution. This shall also apply to any amendment to the Rules. <Amended by Presidential Decree No. 13269, Feb. 1, 1991; Presidential Decree No. 19180, Dec. 14, 2005>
ADDENDUM
This Decree shall enter into force on the date of its promulgation.
ADDENDA<Presidential Decree No. 13269, Feb. 1, 1991>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDA<Presidential Decree No. 13869, Mar. 6, 1993>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDA<Presidential Decree No. 14438, Dec. 23, 1994>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDA<Presidential Decree No. 16326, May 24, 1999>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDA<Presidential Decree No. 17824, Dec. 30, 2002>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2003. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDUM<Presidential Decree No. 19180, Dec. 14, 2005>
This Decree shall enter into force on the date of its promulgation.
ADDENDA<Presidential Decree No. 20721, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDA<Presidential Decree No. 21079, Oct. 10, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures concerning Compensation for Losses)
In respect of a person who suffers a loss due to the execution of cooperation projects in the field of trade or economy under Article 9 at the time this Decree enters into force, a loss compensation agreement concluded to cover such loss shall be deemed an insurance agreement concluded to cover a risk to be incurred due to the execution of the said projects.
ADDENDUM<Presidential Decree No. 22405, Sep. 27, 2010>
This Decree shall enter into force on the date of its promulgation.