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SHIP INVESTMENT COMPANY ACT

Act No. 6701, May 13, 2002

Amended by Act No. 6966, Aug. 6, 2003

Act No. 7428, Mar. 31, 2005

Act No. 7641, Jul. 29, 2005

Act No. 8223, Jan. 3, 2007

Act No. 8635, Aug. 3, 2007

Act No. 8821, Dec. 27, 2007

Act No. 8852, Feb. 29, 2008

Act No. 8863, Feb. 29, 2008

Act No. 9707, May 22, 2009

Act No. 11690, Mar. 23, 2013

Act No. 11756, Apr. 5, 2013

Act No. 12218, Jan. 7, 2014

Act No. 12539, Mar. 24, 2014

Act No. 12820, Oct. 15, 2014

Act No. 13448, Jul. 24, 2015

Act No. 13453, Jul. 31, 2015

Act No. 15004, Oct. 31, 2017

CHAPTER I GENERAL PROVISIONS
 Article 1 (Purpose)
The purpose of this Act is to provide sound investment opportunities in ships by prescribing necessary matters concerning the establishment, management, etc. of a ship investment company, and to contribute to the national economy thereby, such as activation of marine transportation industry.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 2 (Definitions)
The terms used in this Act shall be defined as follows: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
1. The term "ship investment company" means a company that is established under this Act for the purposes of investing assets in ship (referring to ship under subparagraph 1 of Article 2 of the Ship Safety Act; hereinafter the same shall apply) and distributing any profits accruing from such investment to shareholders;
2. The term "ship investment management company" means a company that engages in business to manage assets, such as ships, by being entrusted by a ship investment company and which has obtained permission from the Minister of Oceans and Fisheries under Article 31;
3. The term "custody company" means a trust company under the Financial Investment Services and Capital Markets Act, which is engaged in business to custody the assets and other business related to such custody by being entrusted by a ship investment company;
4. The term "ship operation company" means a company engaged in business to operate or charter ships by being chartered ships owned by a ship investment company or its subsidiary.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 3 (Ship Investment Company)
(1) A ship investment company shall be a stock company.
(2) Where it is necessarily related to business referred to in any subparagraph of Article 24 (1), a ship investment company may establish its subsidiaries in or outside Korea. In such cases, the business conducted by subsidiaries shall be deemed conducted by a ship investment company.
(3) Each ship investment company shall own one ship: Provided, That where it establishes subsidiaries, each subsidiary shall own one ship, respectively. In such cases, a ship investment company shall not own its ship separately.
(4) A ship investment company and its subsidiaries shall not replace a ship owned by themselves with another ship during the period of their existence.
(5) A ship investment company shall not establish a place of business other than the principal office nor have full-time executive officers or employees.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 4 (Application of Commercial Act)
The Commercial Act shall apply to a ship investment company unless otherwise specifically provided for in this Act.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 5 (Use of Name)
(1) A ship investment company shall use the name of ship investment company in its trade name.
(2) No person other than a ship investment company under this Act shall use the name of ship investment company or the name similar thereto.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
CHAPTER II ESTABLISHMENT, AUTHORIZATION AND ISSUANCE OF STOCKS
SECTION 1 Establishment
 Article 6 (Period of Existence)
The period of existence of a ship investment company shall be prescribed by the articles of incorporation: Provided, That it shall be at least three years, from the date when the authorization of ship investment business is obtained under Article 13. <Amended by Act No. 11756, Apr. 5, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 7 (Promoters)
(1) None of the following persons shall be eligible to be a promoter of a ship investment company: <Amended by Act No. 12539, Mar. 24, 2014>
1. A minor, a person under adult guardianship, or under limited guardianship;
2. A person declared bankrupt, but not yet reinstated;
3. A person for whom two years have not yet elapsed since the completion (including where the execution is deemed to have completed) of, or exemption from, a sentence of imprisonment without labor or heavier punishment, as declared by a court;
4. A person for whom two years have not yet elapsed after being sentenced to a fine in violation of this Act or Acts related to marine transportation or finance prescribed by Presidential Decree (including the foreign Acts equivalent thereto; hereinafter referred to as the "Acts related to marine transportation or finance");
5. A person who is under a suspended sentence of imprisonment without labor or heavier punishment, as declared by a court;
6. A person who was an executive officer or employee of a corporation whose business permission, authorization, registration, etc. was revoked under this Act or Acts related to marine transportation or finance (limited to a person prescribed by Presidential Decree who was directly or correspondingly responsible for the cause of revocation of such business permission, authorization, registration, etc.) and for whom five years have not elapsed from the date when permission, etc. for such corporation was revoked;
7. A person for whom five years have not yet elapsed since the date of dismissal or removal from office of an executive officer or employee in a corporation due to his/her violation of this Act or the Acts related to marine transportation or finance.
(2) Promoters of a ship investment company shall underwrite stocks in excess of the rate prescribed by Presidential Decree within the limit not exceeding 30/100 of the stocks to be issued.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 8 (Articles of Incorporation)
(1) Promoters of a ship investment company shall prepare the articles of incorporation, including the matters falling under the following subparagraphs, and all of them shall put their names and seals or signatures thereon:
1. Purpose;
2. Trade name;
3. Total number of stocks to be issued;
4. Price of each stock;
5. Total number of stocks to be issued at the time of establishment;
6. Period of existence;
7. Limit on borrowing of funds and issuance of bonds;
8. Basic direction of asset management;
9. Matters concerning the distribution of profits, capital increase or reduction, etc.;
10. Location of a company;
11. Method of public announcement;
12. Standards for remuneration of directors and auditors;
13. Main terms and conditions of an asset management agreement to be entered into with a ship investment management company (including standards for asset management fees to be paid to a ship investment management company);
14. Main terms and conditions of a custodial agreement to be entered into with a custody company;
15. Main terms and conditions of an agreement to be entered into concerning the building, sale and purchase, and chartering of ships;
16. Names, resident registration numbers and addresses of promoters (where a promoter is a juristic person, its trade name, registration number and location of principal office);
17. Other matters concerning the operation of a ship investment company prescribed by Presidential Decree.
(2) The total number of stocks to be issued under paragraph (1) 5 may be determined by fixing an upper and a lower limit.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 9 (Subscription, etc. for Underwriting Stocks)
(1) Where promoters solicit a subscription for underwriting stocks to be issued at the time of establishing a ship investment company, they shall furnish the other party with investment prospectus that describes the purpose of establishment of a ship investment company, chartering plan and other matters prescribed by Presidential Decree.
(2) Promoters shall provide a person that intends to subscribe for stocks with a subscription form for stocks that describes the following matters: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
1. Matters referred to in the subparagraphs of Article 8 (1);
2. Where the grounds for dissolution are prescribed in the articles of incorporation, such details;
3. Type and number of stocks to be accepted by promoters;
4. Method for allotting stocks to be issued at the time of establishment and deadline of payment for stocks;
5. Financial institution that is assigned to receive the payment for stocks and the place of payment;
6. Names and addresses of candidates for directors and auditors;
7. Matters concerning financing;
8. Name and address of the ship investment management company to enter into a business trust agreement;
9. Name (in case of a corporation, its trade name) and address of a person to enter into an agreement concerning the building, purchase and chartering of ship;
10. Statement that the establishment of a ship investment company may be cancelled where the number of stocks subscribed for underwriting is less than that to be issued at the time of establishment;
11. Statement that any person that has subscribed for underwriting stocks may cancel such subscription if a ship investment company is not established by the fixed time or cannot obtain authorization from the Minister of Oceans and Fisheries under this Act;
12. Other matters prescribed by Presidential Decree concerning the interest relationship of shareholders.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 10 (Restriction on Exceptional Incorporation)
Notwithstanding subparagraph 2 of Article 290 of the Commercial Act, no ship investment company may be established by means of contribution in-kind.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 11 (Legal Fiction of Appointment of Directors and Auditors)
(1) Candidates for directors and auditors written in a subscription form for stocks shall be deemed appointed as directors and auditors when the allotment of stocks is completed.
(2) Directors and auditors under paragraph (1) shall obtain the approval through the inaugural general meeting.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 12 (Matters, etc. to Be Registered for Establishment)
(1) Matters to be registered for establishment shall be as follows:
1. Matters referred to in Article 8 (1) 1 through 5, 7, 11 and 12;
2. Where the grounds for dissolution of a ship investment company are provided for in the articles of incorporation, such details;
3. Name and address of a transfer agent;
4. Names, resident registration numbers and addresses of directors and auditors;
5. Name, resident registration number and address of a director representing a company;
6. Where it is determined that more than two directors are to represent a ship investment company, such details.
(2) Where the registration of establishment is applied, documents prescribed by Presidential Decree shall be attached.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
SECTION 2 Authorization
 Article 13 (Authorization of Ship Investment Business)
(1) Where a ship investment company intends to conduct business under any subparagraph of Article 24 (1), it shall obtain the authorization from the Minister of Oceans and Fisheries, as prescribed by Ordinance of the Ministry of Oceans and Fisheries. The same shall apply where any authorized matters are changed. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
(2) Where the Minister of Oceans and Fisheries receives an application for authorization under paragraph (1), he/she shall grant the authorization except for the cases where the application for authorization falls under any of the following cases: <Amended by Act No. 11756, Apr. 5, 2013>
1. Where the applicant is not a ship investment company established under this Act;
2. Where the business plan is substantially insufficient to secure the soundness of management, such as violating any statutes or causing harm to financial order;
3. Where an entrustment contract to be entered into with a ship investment management company or a custody company is inappropriate for protecting the investors or for the sound management;
4. Where a charter party agreement to be entered into with a ship operation company is inappropriate for the protection of investors or sound management;
5. Where no appropriate measures are prepared against cases where forfeited stocks occur at the time of public offering;
6. Other cases that violate this Act or any other statutes.
(3) Where the Minister of Oceans and Fisheries grants the authorization under paragraph (1), he/she may attach conditions or restrict the scope of business in order to secure the soundness of management and protect the investors. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
(4) Where the Minister of Oceans and Fisheries grants the authorization under paragraph (1), he/she shall notify the Financial Services Commission of the details thereof, and shall publicly announce such details through the Official Gazette, computer communications, etc., as prescribed by Ordinance of the Ministry of Oceans and Fisheries. <Amended by Act Nos. 8852 & 8863, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 13-2 (Authorization of Exclusive Ship Investment Business for Authorized Ship)
(1) The Minister of Oceans and Fisheries may authorize the establishment of a ship investment company that conducts business exclusively for authorized ships (referring to ships the State operate by owning or chartering based on sale on deferred payment; hereinafter the same shall apply). <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
(2) Where the Minister of Oceans and Fisheries grants the authorization pursuant to Article 13 (1) to a ship investment company under paragraph (1), he/she shall consult with the Minister of Strategy and Finance in advance concerning the following matters: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
1. Authorized ship concerned;
2. Building plan and management plan of authorized ship by a ship investment company;
3. Matters concerning the transfer of ownership of authorized ship by sale on deferred payment;
4. Matters concerning the terms, methods, procedures and conditions of an agreement between the State and a ship investment company concerning the building, etc. of authorized ships;
5. Matters concerning the dividends rate to shareholders of a ship investment company, method of guarantee, etc.
(3) With respect to a ship investment company under paragraph (1), the sale on deferred payment for the transfer of ownership of authorized ship shall be added to the scope of business referred to in any subparagraph of Article 24 (1). In such cases, the period of sale on deferred payment shall be construed as the period of chartering under Article 26 (1).
(4) A charter party agreement for an authorized ship shall be appropriate for the protection of investors or sound management, and Article 26 shall apply mutatis mutandis to the charter party agreement. In such cases, "ship operation company" shall be construed as the "State". <Amended by Act No. 11756, Apr. 5, 2013>
(5) Articles 3 (3) and 27 (1) and the main sentence of Article 28 shall not apply to a ship investment company under paragraph (1).
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 14 (Invalidation of Authorization)
(1) Where a ship investment company fails to commence its business until six months have elapsed from the date when the authorization was obtained under Article 13 (1), such authorization shall be null and void.
(2) Notwithstanding paragraph (1), where it is deemed that any justifiable reason exists, the Minister of Oceans and Fisheries may extend the period under paragraph (1) within six months by receiving an application of a ship investment company. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 14-2 Deleted. <by Act No. 9707, May 22, 2009>
SECTION 3 Issuance of Stocks
 Article 15 (Issuance of Stocks)
(1) Where a ship investment company issues stocks after its establishment and solicits a subscription for underwriting thereof, it shall prepare a subscription form for stocks and investment prospectus as prescribed by Presidential Decree and furnish them to those who intend to underwrite the stocks.
(2) No ship investment company may issue stocks after the building or purchase of ship is completed: Provided, That in cases prescribed by Presidential Decree, such as where it is necessary for the normalization of operation of a ship or the protection of investors, it may additionally issue stocks within the scope prescribed by Presidential Decree including the ratio, etc. of additional issuance of stocks, following a resolution of a general meeting of shareholders under Article 434 of the Commercial Act. <Amended by Act No. 11756, Apr. 5, 2013>
(3) No shareholder of a ship investment company may request the redemption of stocks during the period of existence of a ship investment company.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 16 (Terms of Issuance)
(1) Where a ship investment company issues stocks after its establishment, the terms and conditions for issuance including issuing price for the same kind of stocks that are issued on the same day shall be uniformly established.
(2) In cases of paragraph (1), the issue price of stocks shall be calculated on the basis of market value, asset value and earning value of a ship investment company concerned in such manner as prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 17 (Listing, etc. of Stocks)
(1) Where a ship investment company meets the listing requirements of the listing regulations under Article 390 (1) of the Financial Investment Services and Capital Markets Act, it shall without delay list its stocks on the securities market and cause them to be traded.
(2) Where a ship investment company fails to list its stocks on the securities market under paragraph (1) without justifiable grounds, the Minister of Oceans and Fisheries may order the company to list its stocks for a fixed period. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 18 (Restriction on Holding of Stocks)
(1) The total number of stocks in a ship investment company held by a ship investment management company, a custody company, a ship operation company or a person that has entered into an agreement for building or sale and purchase of ships (hereafter referred to as "ship investment management company, etc." in this Article) and persons having a special relationship therewith shall not exceed 25/100 of the total number of issued stocks of such ship investment company.
(2) Where a ship investment management company, etc. and its respective specially-related persons hold the stocks of a ship investment company, in violation of paragraph (1), they shall not exercise the voting rights for the stocks exceeding 25/100 of such stocks.
(3) Where a ship investment management company, etc. and its respective specially-related persons hold the stocks exceeding 25/100 of the total number of issued stocks of a ship investment company, the Minister of Oceans and Fisheries may order them to dispose of such excess stocks for a fixed period within three months. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
(4) The scope of persons having a special relationship under paragraphs (1) through (3) shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 19 (Restriction on Acquisition of Treasury Stocks and Pledge)
Unless provided for by Presidential Decree, no ship investment company may acquire its own stocks or provide them as a pledge.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
CHAPTER III ORGANIZATION
 Article 20 (Qualifications of Directors)
No person falling under any subparagraph of Article 7 (1) shall be a director of a ship investment company.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 21 (Duties of Board of Directors)
(1) Where a ship investment company is engaged in any of the acts falling under any of the following subparagraphs, it shall undergo a resolution of the board of directors:
1. Matters concerning a building agreement or sale and purchase of ships;
2. Matters concerning a charter party agreement of ships;
3. Matters concerning a business trust agreement with a ship investment management company and an custody company;
4. Borrowing of funds or issuance of bonds;
5. Expenses incurred in managing ships or other assets;
6. Other matters deemed important for the operation of a ship investment company provided for in the articles of incorporation.
(2) Where a ship investment company is engaged in matters referred to in paragraph (1) 1 through 3, it shall undergo a resolution of a general meeting of shareholders: Provided, That the same shall not apply where a ship investment company enters into a business trust agreement with a person that becomes a ship investment management company upon establishment.
(3) The board of directors shall evaluate the statement of asset management, etc. reported by a ship investment management company and report such results to a general meeting of shareholders at least once every year.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 22 (Convening of Meeting of Board of Directors)
Where a director intends to convene a meeting of the board of directors, he/she shall give notice thereof to each director and auditor five days before the date of the meeting.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 23 (Written Resolutions)
(1) Directors may exercise their voting rights in writing without attending a meeting of the board of directors.
(2) A director who intends to convene a meeting of the board of directors shall, when informing the convening of the meeting, send the necessary documents for exercising voting rights in writing.
(3) Any director who intends to exercise voting rights in writing shall state the contents of the exercise of voting rights in the documents under paragraph (2) and submit them to the board of directors not later than the day preceding the meeting.
(4) The number of directors who exercise voting rights in writing shall be included in the number of directors present at the meeting.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
CHAPTER IV BUSINESS
 Article 24 (Scope of Business)
(1) A ship investment company may conduct business falling under the following subparagraphs:
1. Acquisition of ships;
2. Chartering of ships;
3. Borrowing of funds and issuance of bonds;
4. Issuance of stocks;
5. Management and sale of ships acquired;
6. Other business prescribed by Presidential Decree.
(2) No ship investment company may be concurrently engaged in business other than that referred to in paragraph (1).
(3) No ship investment company may invest the assets in securities: Provided, That the same shall not apply where it acquires the stocks of its subsidiary to be established under Article 3 (2).
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 25 (Borrowing of Funds and Issuance of Bonds)
(1) A ship investment company may borrow funds or issue bonds only in cases where using them for the following purposes. Notwithstanding Article 21 (1) 4, in cases where using them as working funds, it shall undergo a resolution of a general meeting of shareholders:
1. Acquisition or remodelling of ships;
2. Repayment of existing borrowed funds or bonds.
(2) The limit of borrowing of funds and issuance of bonds under paragraph (1) shall be prescribed by Presidential Decree within the scope not exceeding ten times of the capital: Provided, That where it is subjected to the conditions that any borrowed funds or issued bonds should be repaid with the paid-in capital of the relevant ship investment company within three months from the date of borrowing funds or issuing date of bonds within the scope of the total amount of par value of the stocks to be issued which is approved under Article 13 (1), the funds may be borrowed or bonds may be issued exceeding ten times the capital.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 26 (Chartering)
(1) A ship investment company shall lease out its owned ship to a ship operation company for a fixed period of two years or more.
(2) A ship investment company may charter its ship under the condition that it should transfer the ownership of the ship to a ship operation company at the time when the period of chartering under paragraph (1) expires.
(3) Necessary matters concerning the methods, procedures, etc. of the chartering under paragraph (2) shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 27 (Restriction on Ownership, etc. of Ships)
(1) A ship investment company and its subsidiary shall own ships which have passed the inspection by an internationally recognized ship inspection institution (hereafter referred to as "ship inspection" in this Article). Any ship that is under construction shall receive the ship inspection without delay after completion of the construction.
(2) The scope of ship inspection institutions under paragraph (1) shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 28 (Purchase of Insurance Policies)
A ship investment company shall purchase an insurance policy for its owned ship in order to indemnify any loss caused by fatalities, ships, pollution, etc.: Provided, That where a ship operation company has purchased an insurance policy for a ship chartered from a ship investment company, the ship investment company shall be deemed to have purchased such insurance policy.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 29 (Restriction on Transaction)
(1) No ship investment company shall conduct any transaction with a person falling under any of the following subparagraphs concerning the transaction referred to in any subparagraph of Article 24 (1):
1. An executive officer of a relevant ship investment company and a person having a special relationship therewith;
2. A ship investment management company that has entered into a trust agreement with a ship investment company, its executive officers and employees, and their specially-related persons;
3. A shareholder who holds 10/100 or more of the stocks in a relevant ship investment company and any person in a special relationship therewith.
(2) The scope of persons having a special relationship under paragraph (1) shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 30 (Entrustment of Business)
(1) A ship investment company shall entrust the business under the subparagraphs of Article 24 (1) to a ship investment management company.
(2) Where a ship investment management company conducts business concerning the invitation of subscription or sale and purchase of the stocks to be issued under Article 24 (1) 4 from among the business entrusted under paragraph (1), it shall obtain the authorization for investment trading business or investment brokerage business under the Financial Investment Services and Capital Markets Act or entrust such business to an institution which has obtained such authorization. <Amended by Act Nos. 8852 & 8863, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013; Act No. 15004, Oct. 31, 2017>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 31 (Permission, etc. of Ship Investment Management Company)
(1) Any person that intends to conduct business of managing assets, such as ships, by being entrusted by a ship investment company shall obtain the permission from the Minister of Oceans and Fisheries: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013; Act No. 11756, Apr. 5, 2013>
1. through 7. Deleted <Amended by Act No. 11756, Apr. 5, 2013>
(2) Where the Minister of Oceans and Fisheries receives an application for permission under paragraph (1), he/she shall grant the permission except for cases where the application for permission falls under any of the following cases: <Newly Inserted by Act No. 11756, Apr. 5, 2013>
1. Where the applicant is not a stock company under the Commercial Act;
2. Where the applicant fails to meet the criteria for paid-in capital prescribed by Presidential Decree which is not less than five billion won;
3. Where the number of ship management specialists and finance specialists satisfying the conditions prescribed by Presidential Decree, such as the working experience in marine transportation business or in financial business, among the full-time executive officers and employees, is less than the number prescribed by Presidential Decree;
4. Where the business plan is substantially insufficient to secure the soundness of management, such as violating any statutes or causing harm to financial order;
5. Where any executive officer falls under any subparagraph of Article 7 (1);
6. Where the major shareholders prescribed by Presidential Decree fail to have sufficient investment capacity and sound financial status prescribed by Presidential Decree;
7. Where the applicant fails to establish a system for prevention of conflicts of interests between the ship investment management company of a public ship investment company under Article 55-2 (1) and investors therein, or among investors in such public ship investment company;
8. Other cases that violate any restriction under this Act or other statutes.
(3) Detailed matters concerning the requirements for permission under paragraph (2) shall be prescribed by Presidential Decree. <Amended by Act No. 11756, Apr. 5, 2013>
(4) No person, other than a ship investment management company, shall use the name of a ship investment management company or any name similar thereto in its trade name.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 32 (Restriction, etc. on Concurrent Engagement of Ship Investment Management Company)
(1) No ship investment management company shall concurrently engage in any business other than the business entrusted by a ship investment company: Provided, That the same shall not apply to any of the following cases: <Amended by Act No. 15004, Oct. 31, 2017>
1. Where it is allowed to engage in any other business, under this Act or any other Act;
2. Where it engages in consulting business concerning the business referred to in subparagraphs of Article 24 (1) (limited to cases related to ships, in cases of subparagraphs 3, 4 and 6 of the same paragraph);
3. Where it engages in a business approved by the Minister of Oceans and Fisheries as the relevant business is not deemed to hinder the operation of entrusted assets and the protection of investors.
(2) No full-time executive officer of a ship investment management company shall become a full-time executive officer or employee of another company, nor manage other business unless it has obtained the approval from the Minister of Oceans and Fisheries. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 33 (General Standards for Acts of Ship Investment Management Company)
(1) A ship investment management company shall faithfully conduct its business with such due care as is required of a good manager in accordance with this Act and the business trust agreement.
(2) No ship investment management company shall be engaged in any act falling under any of the following subparagraphs concerning the business entrusted by a ship investment company:
1. Providing any profits accruing from the management of ships as security or lending or transferring them to others;
2. Guaranteeing or promising certain profits to a ship investment company;
3. Causing a ship investment management company to bear or to promise any full or partial loss accruing from the management of entrusted ships;
4. Facilitating its own interests or those of a third party with ships entrusted for management by a ship investment company;
5. An act likely to be harmful to an interest of a ship investment company and its shareholders and prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 34 (Detailed Standards concerning Permission and Business of Ship Investment Management Company)
Except as provided for in Articles 31 through 33, necessary matters concerning permission and business of a ship investment management company shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 34-2 (Minimum Amount of Net Assets of Ship Investment Management Company)
A ship investment management company shall maintain the minimum amount of net assets prescribed by Presidential Decree, to within five billion won, from the date one year elapses after obtaining permission under Article 31 (1).
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 34-3 (Responsibilities of Ship Investment Management Company)
(1) Where a ship investment management company causes any losses to a ship investment company that has entrusted business under Article 24 (1) in violation of general standards for acts referred to in Article 33, it shall be liable to compensate for such losses.
(2) Where a ship investment management company is liable to compensate for losses under paragraph (1) and any related directors or auditors have any causes attributable to them, they shall be liable to compensate for such losses jointly and severally.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 35 (Urgent Termination, etc. of Agreements)
Notwithstanding the main sentence of Article 21 (2), in any case falling under any of the following subparagraphs, a ship investment company may terminate a business trust agreement with a ship investment management company through a resolution of a meeting of the board of directors and enter into a business trust agreement by selecting another ship investment management company. In such cases, it shall, without delay, obtain approval at a general meeting of shareholders, and if such approval has not been obtained, the termination and execution of the business trust agreement with a ship investment management company shall lose its effect in the future:
1. Where a ship investment management company that has violated obligations under this Act or Acts related to marine transportation or finance or business trust agreement, is likely to cause serious loss to a ship investment company concerned unless an agreement is terminated urgently;
2. Where a ship investment management company has difficulty in conducting all or some of its business continuously for reasons, such as business suspension or dissolution.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 36 (Entrustment of Asset Custody)
(1) A ship investment company shall entrust the business of keeping documents certifying the relationship of rights of assets and ships owned as prescribed by Presidential Decree and its related business to a custody company.
(2) Where a custody company has any securities under the Financial Investment Services and Capital Markets Act of the assets entrusted, it shall deposit them to the Korea Securities Depository under Article 294 of the same Act, as prescribed by Presidential Decree.
(3) Necessary matters concerning the method, etc. of entering into an agreement concerning entrustment, such as asset holding business under paragraph (1), shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 37 (Obligations, etc. of Custody Companies)
(1) An custody company shall faithfully perform its business for a ship investment company with such due care as is required of a good manager in accordance with statutes and a custodial agreement.
(2) An custody company shall comply with statutes and establish necessary procedures and standards for the performance of its business, as prescribed by Presidential Decree, in order to soundly hold the assets entrusted to it.
(3) An custody company shall manage the assets entrusted by a ship investment company by separating them from its own property and the assets entrusted for holding from a third party.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
CHAPTER V SETTLEMENT OF ACCOUNTS
 Article 38 (Preparation, etc. of Statements for Settlement of Accounts)
(1) A director of a ship investment company shall prepare the following documents and their annexed specifications (hereinafter referred to as "statements for settlement of accounts") each term for settlement of accounts and obtain the approval of the board of directors:
1. A statement of financial position;
2. An income statement;
3. A statement of appropriation of retained earnings and statement of cash flows;
4. A statement of distribution of profits under Article 41.
(2) A director of a ship investment company shall submit the statement for the settlement of accounts to an auditor by not later than four weeks prior to the date that has been set for the general meeting of shareholders.
(3) A director of a ship investment company shall prepare an asset management report each term for settlement of accounts and report it to the board of directors.
(4) Standards for preparing the statements for the settlement of accounts and matters to be stated therein shall be prescribed by Ordinance of the Ministry of Oceans and Fisheries. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 39 (Audit Reports)
(1) An auditor shall prepare an audit report within two weeks after the date of receiving the statements for the settlement of accounts under Article 38 (2) and submit it to a director.
(2) The matters to be stated in an audit report under paragraph (1) shall be prescribed by Ordinance of the Ministry of Oceans and Fisheries. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 40 (Approval, etc. of Statements for Settlement of Accounts)
(1) A director shall submit the statements for settlement of accounts approved by a meeting of the board of directors to a general meeting of shareholders for its approval. In such cases, an audit report under Article 39 (1) shall also be submitted.
(2) Upon obtaining the approval of the statements for the settlement of accounts by a general meeting of shareholders under paragraph (1), a director shall without delay submit the following documents to the Minister of Oceans and Fisheries and publicly announce the balance sheet and audit report: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
1. Statements for the settlement of accounts approved by a general meeting of shareholders;
2. Audit report under Article 39 (1).
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 40-2 (Special Provisions concerning Approval of Statements for Settlement of Accounts)
(1) Notwithstanding Article 40, a company may approve its statements for settlement of accounts by the resolution of the board of directors as prescribed by its articles of incorporation. In such cases, all of the following requirement shall be satisfied:
1. There should be an external auditor's opinion that the statements for settlement of accounts adequately indicate the financial status and management performance in accordance with the statutes and the articles of incorporation;
2. Consent from all auditors shall have been obtained.
(2) Upon obtaining the approval from the board of directors under paragraph (1), a director shall report details of the statements for settlement of accounts to a general meeting of shareholders.
[This Article Newly Inserted by Act No. 15004, Oct. 31, 2017]
 Article 41 (Distribution of Profits)
(1) A ship investment company shall distribute the amount calculated by deducting repayments due to borrowing of funds and issuance of bonds under Article 25 and operating expenses determined by Presidential Decree from the profits accruing from the management of assets to its shareholders.
(2) In cases where distributing the amount under paragraph (1), any earned surplus reserve under Article 458 of the Commercial Act shall not be accumulated.
(3) In cases falling under any of the following subparagraphs, a ship investment company may distribute the amount to its shareholders even during the period of building of its owned ships:
1. Where the price of building ships is discounted by the person who builds the ships;
2. Where any revenue accrues from the capital;
3. Where any revenue accrues from a ship operation company;
4. Where any other revenue accrues.
(4) A ship investment company may, where a resolution of a general meeting of shareholders has been passed, or as prescribed by the articles of incorporation, distribute the amount under paragraphs (1) and (3) by determining certain date at least once every year.
(5) Necessary matters, such as the method of calculating any necessary distributable amount for the distribution of the amount under paragraph (4), shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 42 (Keeping, etc. of Statements for Settlement of Accounts)
(1) A ship investment company shall keep the documents falling under the following subparagraphs:
1. Statements for settlement of accounts approved by a general meeting of shareholders;
2. Audit report under Article 39 (1);
3. Articles of incorporation;
4. Minutes of general meeting of shareholders;
5. Register of shareholders;
6. Minutes of the board of directors.
(2) A ship investment company shall send the documents referred to in paragraph (1) to a ship investment management company and have it keep them at its place of business.
(3) A ship investment company shall keep the documents referred to in paragraph (1) 1 and 2 for five years from the date when approval thereof has been obtained under Article 40 (1).
(4) A ship investment company shall allow its shareholders and creditors to peruse the documents refereed to in paragraph (1). Where the shareholders and creditors request the issuance of certified copies or abstracts of such documents, the company shall issue them.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
CHAPTER VI SUPERVISION
 Article 43 (Report of Statement of Asset Management)
A ship investment management company shall report the statement of asset management to the Minister of Oceans and Fisheries every six months. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 44 (Supervision, Inspection, etc.)
(1) In any of the following cases, the Minister of Oceans and Fisheries may order a ship investment company, a ship investment management company and an custody company to submit or report on data concerning business affairs, etc. under this Act, for the purpose of the sound operation of a ship investment company and protection of shareholders: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
1. Where the restriction on transactions under Article 29 is violated;
2. Where the requirements for permission of a ship investment management company under Article 31 are violated;
3. Where the restriction, etc. on concurrent engagement of a ship investment management company under Article 32 is violated;
4. Where general standards for acts of a ship investment management company under Article 33 are violated;
5. Where the obligations of an custody company under Article 37 are violated.
(2) The Minister of Oceans and Fisheries may have any employee under his/her jurisdiction inspect any of the following business affairs, etc. of a ship investment company or a ship investment management company: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
1. Restriction on holding of stocks by a person in a special relationship under Article 18;
2. Borrowing of funds and issuance of bonds under Article 25;
3. Distribution of profits under Article 41.
(3) Where conducting an inspection under paragraph (2), an inspection schedule regarding the time and date, grounds, subject matters, etc. of an inspection shall be notified to the person subject to inspection by not later than seven days before the inspection: Provided, That the same shall not apply to cases of urgency or to cases where it is deemed that the aim of inspection may not be achieved due to destruction of evidence, etc. when notified in advance.
(4) Where an inspection is completed under paragraph (2), the Minister of Oceans and Fisheries shall notify the person subject to inspection of the result thereof in writing. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
(5) Any public official that conducts an inspection under paragraph (2) shall carry an identification indicating his/her authority and present it to the persons concerned.
(6) Where, as turned out after the inspection under paragraph (2), a ship investment company or a ship investment management company violates this Act or any order or disposition issued under this Act or a public ship investment company under Article 55-2 (1) or a ship investment management company (excluding a ship investment management company entrusted with the operation of assets, such as ships, only by a ship investment company not a public ship investment company) violates the Financial Investment Services and Capital Markets Act or any order or disposition issued under the same Act or the Act on Corporate Governance of Financial Companies (limited to the provisions of Articles 24 through 26), the Minister of Oceans and Fisheries may take any of the following measures: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013; Act No. 12218, Jan. 7, 2014; Act No. 13453, Jul. 31, 2015>
1. All or some business suspension within the limit of six months;
2. Request for dismissal of executive officers or disciplinary action against executive officers and employees;
3. Other measures prescribed by Presidential Decree as necessary for correction of any violation.
(7) Where an custody company violates this Act or any order or disposition issued under this Act, the Oceans and Fisheries may request the Financial Services Commission to take any necessary measures under the relevant Acts. In such cases, the Financial Services Commission shall comply with such request unless any special reason exists to the contrary. <Amended by Act Nos. 8852 & 8863, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
(8) Detailed criteria for business suspension under paragraph (6) and other necessary matters shall be prescribed by Ordinance of the Ministry of Oceans and Fisheries. <Newly Inserted by Act No. 12218, Jan. 7, 2014>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 45 (Supervision by Financial Services Commission)
(1) Where it is deemed necessary for the financial supervision for the purpose of the sound operation of a ship investment company and the protection of shareholders, the Financial Services Commission may order a ship investment company, a ship investment management company and a custody company to submit or report on the data concerning business related to the relevant financial supervision. <Amended by Act No. 8863, Feb. 29, 2008>
(2) Where it is deemed necessary for the financial supervision, the Governor of the Financial Supervisory Commission under Article 24 of the Act on the Establishment, etc. of Financial Services Commission may have any employee under his/her jurisdiction inspect business concerning financial supervision of the business of a ship investment company, a ship investment management company and a custody company. <Amended by Act No. 8863, Feb. 29, 2008>
(3) Where a ship investment company or a ship investment management company violates this Act or any order or disposition issued under this Act while conducting business related to financial supervision or violates the Financial Investment Services and Capital Markets Act or any order or disposition issued under the same Act, the Financial Services Commission may request the Minister of Oceans and Fisheries to take any necessary measures against such company under the relevant statutes, and the Minister of Oceans and Fisheries shall comply with such request unless any special reason exists to the contrary. In such cases, the Minister of Oceans and Fisheries shall inform the details of such measures to the Financial Services Commission. <Amended by Act Nos. 8852 & 8863, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013; Act No. 13453, Jul. 31, 2015; Act No. 15004, Oct. 31, 2017>
(4) Notwithstanding the former part of paragraph (3), in cases of a private ship investment company (referring to a ship investment company other than a public ship investment company under Article 55-2 (1)) or a private asset management company (referring to a ship investment management company that is entrusted with the investment and operation of assets from a ship investment company other than a public ship investment company), the Financial Services Commission shall consult with the Minister of Oceans and Fisheries before requesting the Minister of Oceans and Fisheries to take necessary measures. <Newly Inserted by Act No. 15004, Oct. 31, 2017>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 46 (Revocation of Authorization of Ship Investment Business)
Where a ship investment company falls under any of the following cases, the Minister of Oceans and Fisheries may revoke the authorization of a ship investment business under Article 13 (1): Provided, That such authorization shall be revoked in case of falling under any of subparagraphs 1 through 3: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013; Act No. 11756, Apr. 5, 2013>
1. Where it is dissolved;
2. Where a ship is destroyed;
3. Where it obtains authorization by fraud or other wrongful means;
4. Where it falls under any subparagraph of Article 13 (2) or violates conditions and scope of restriction under Article 13 (3), after obtaining the authorization.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 47 (Revocation of Permission of Ship Management Companies)
Where a ship investment management company falls under subparagraph 1 or 2, the Minister of Oceans and Fisheries shall revoke the permission; where it falls under any of subparagraphs 3 through 6, he/she shall order it to correct for a fixed period and revoke the permission when it fails to take corrective measures: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013; Act No. 11756, Apr. 5, 2013; Act No. 15004, Oct. 31, 2017>
1. Where it is dissolved;
2. Where it obtains the permission by fraud or other wrongful means;
3. Where it falls under Article 31 (2) subparagraphs 1 through 5;
4. Where it fails to commence business until one year after obtaining the permission has passed;
5. Where it cannot maintain the requirements for the minimum amount of net assets under Article 34-2.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
CHAPTER VII MERGER, DISSOLUTION AND LIQUIDATION
 Article 48 (Restriction on Merger)
No ship investment company may be merged with another company.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 49 (Grounds for Dissolution)
A ship investment company shall be dissolved on the grounds falling under any of the following subparagraphs:
1. Expiration of the period of existence provided for in the articles of incorporation or occurrence of other grounds for dissolution;
2. Resolution of dissolution by a general meeting of shareholders;
3. Bankruptcy;
4. Order or judgement to dissolve of the court;
5. Revocation of authorization of ship investment business under Article 46.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 50 (Report on Dissolution)
Where a ship investment company is dissolved, its liquidator or bankruptcy administrator shall report such fact to the Minister of Oceans and Fisheries within 30 days after the date of dissolution. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 51 (Entrustment Registration by Minister of Oceans and Fisheries)
(1) Where a ship investment company is dissolved for the ground prescribed in subparagraph 5 of Article 49, the Minister of Oceans and Fisheries shall request the registration of such dissolution to the registry office that exercise jurisdiction over the location of such ship investment company. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
(2) Where the Minister of Oceans and Fisheries requests the registration under paragraph (1), he/she shall attach documents that certify the ground for registration. <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
CHAPTER VIII SUPPLEMENTARY PROVISIONS
 Article 52 (Special Cases concerning Ship Registration)
Where a ship investment company intends to own a ship and borrows 50/100 or more of the price of such ship (referring to the price of a ship indicated in the building agreement or sale and purchase agreement of a ship) from a foreigner, notwithstanding Articles 2 or 8 of the Ship Act, it may register the ship in a country requested by such foreigner.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 53 (Special Cases concerning Ship Investment Company for Minority Investors)
(1) Articles 7 (2), 17, 18 (excluding cases where the Monopoly Regulation and Fair Trade Act applies), 29 (1) 3, and 30 (2) shall not apply to a ship investment company that issues the stocks by private offering only under Article 9 (8) of the Financial Investment Services and Capital Markets Act with the number of its shareholders being less than that prescribed by Presidential Decree within the scope not exceeding two hundred: Provided, That subparagraphs 6 and 7 of Article 71 of the Financial Investment Services and Capital Markets Act shall apply mutatis mutandis where Article 30 (2) is not applied. <Amended by Act No. 15004, Oct. 31, 2017>
(2) Necessary matters concerning the asset management of a ship investment company under paragraph (1) shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 53-2 (Special Cases concerning Ship Investment Companies Targeting at Professional Investors)
(1) Where a ship investment company that issues stocks only to professional investors defined in Article 9 (5) of the Financial Investment Services and Capital Markets Act (hereinafter referred to as "ship investment company for professional investors" in this Article) is established for new construction of a ship, the Minister of Oceans and Fisheries shall examine the substance of a charter party agreement to be entered into with a ship operation company including charter period, but the examination of detailed matters, such as hire, may be omitted. In such cases, the relevant ship investment company for professional investors shall enter into a charter party agreement with a ship operation company after finalizing the detailed matters including hire not later than 30 days before the delivery date of the newly constructed ship and obtain the authorization for the change under the latter part of Article 13 (1).
(2) Where a ship investment company for professional investors issues stocks after its establishment, it may determine the issue price and other terms of issuance differently, notwithstanding Article 16 (1). <Newly Inserted by Act No. 15004, Oct. 31, 2017>
(3) Notwithstanding the main sentence of Article 24 (3), a ship investment company for professional investors may invest in the State bonds, local government bonds or special bonds defined in Article 4 (3) of the Financial Investment Services and Capital Markets Act after obtaining a resolution of a general meeting of shareholders within the limit of net dividend calculated by subtracting the amount of principal repayment to investors from the profits to be distributed to the shareholders under Article 41 (1).
(4) Notwithstanding the main sentence of Article 25 (2), a ship investment company for professional investors may borrow funds or issue bonds exceeding ten times of the capital stock. <Newly Inserted by Act No. 15004, Oct. 31, 2017>
(5) Notwithstanding Article 26 (1), a ship investment company for professional investors may enter into a charter party agreement fixing the charter period to be at least one year.
[This Article Newly Inserted by Act No. 11756, Apr. 5, 2013]
 Article 54 (Public Hearings)
Where the Minister of Oceans and Fisheries intends to take any of the following dispositions, he/she shall hold a public hearing: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013; Act No. 15004, Oct. 31, 2017>
1. Revocation of the authorization under subparagraphs 2 through 4 of Article 46;
2. Revocation of the permission under subparagraphs 2 through 4 of Article 47.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 55 (Relationship with Other Acts)
(2) Article 24 (1) of the Act on the Structural Improvement of the Financial Industry shall not apply to persons that acquire stocks issued by a ship investment company. <Amended by Act No. 11756, Apr. 5, 2013>
(3) Deleted. <by Act No. 11756, Apr. 5, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 55-2 (Special Cases concerning Public Ship Investment Company)
(1) Articles 11 through 16, 30 through 32, 34 through 36, 40 through 43, 50 through 53, 56, 58, 61 through 65, 80 through 83, subparagraphs 2, 3 and 6 through 8 of Article 85, 86, 87, 93 through 95, 181 through 183, 184 (1) and (2), and (5) through (7), 186, 194 through 200, 202 through 206, 229 through 249, 249-2 through 249-22, 250 through 253, 415 through 425 of the Financial Investment Services and Capital Markets Act, and the Act on Corporate Governance of Financial Companies (excluding the provisions of Articles 24 through 26 in cases of a ship investment management company prescribed by Presidential Decree, by taking into account the scale of entrusted assets) shall not apply to a public ship investment company (referring to a ship investment company that does not fall under a private collective investment vehicle under Article 9 (19) of the Financial Investment Services and Capital Markets Act; hereinafter the same shall apply) and a ship investment management company (excluding a ship investment management company entrusted with the operation of assets, such as ship, only by a ship investment company, not a public ship investment company). <Amended by Act No. 9707, May 22, 2009; Act No. 13448, Jul. 24, 2015; Act No. 13453, Jul. 31, 2015; Act No. 15004, Oct. 31, 2017>
(2) Articles 165-3 through 165-9, 165-11 through 165-18, and 171 of the Financial Investment Services and Capital Markets Act shall not apply to a public ship investment company. <Newly Inserted by Act No. 11756, Apr. 5, 2013>
(3) Where the Minister of Oceans and Fisheries grants the authorization under Article 13 to a public ship investment company or permission under Article 31 to a ship investment management company (excluding a ship investment management company entrusted with the operation of assets, such as ship, only by a ship investment company not a public ship investment company), he/she shall consult with the Financial Services Commission in advance. <Amended by Act Nos. 8852 & 8863, Feb. 29, 2008; Act No. 11690, Mar. 23, 2013>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 55-3 (Special Cases concerning Ship Investment Company Investing in Ship to Be Sold for Debt Repayment, etc.)
Articles 6, 10, 15 (2), 25 (2) and 26 (1) shall not apply to a ship investment company, at least 70/100 of the total assets of which are composed of the following assets: <Amended by Act No. 11690, Mar. 23, 2013>
1. Ship to be sold for repayment of debt, such as that for a creditor financial institution;
2. Ship to be sold for the performance of an agreement after entering into the relevant agreement for improvement of financial structure with a creditor financial institution;
3. Ship to be sold pursuant to the rehabilitation procedure under the Debtor Rehabilitation and Bankruptcy Act;
4. Other ships deemed necessary to assist the corporate restructuring by the Minister of Oceans and Fisheries or the Financial Services Commission.
[This Article Newly Inserted by Act No. 9707, May 22, 2009]
[This Act shall remain valid until December 31, 2015 pursuant to the provisions of Article 2 of the Addenda of Act No.9707 (May 22, 2009)]
CHAPTER IX PENALTY PROVISIONS
 Article 56 (Penalty Provisions)
Any person who falls under any of the following subparagraphs shall be punished by imprisonment with labor for not more than five years, or by a fine not exceeding fifty million won: <Amended by Act No. 12820, Oct. 15, 2014>
1. Any person who obtains authorization under the former part of Article 13 (1) by fraud or other wrongful means;
2. Any person who conducts business of a ship investment company without obtaining authorization under the former part of Article 13 (1);
3. Any person who borrows funds or issued bonds in violation of the purpose or limit under Article 25;
4. Any person who obtains permission under Article 31 (1) by fraud or other wrongful means;
5. Any person who conducts business of a ship investment management company without obtaining permission under Article 31 (1);
6. Any person who engages in an act falling under any subparagraph of Article 33 (2).
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 57 (Penalty Provisions)
Any person who falls under any of the following subparagraphs shall be punished by imprisonment with labor for not more than three years, or by a fine not exceeding thirty million won: <Amended by Act No. 12820, Oct. 15, 2014>
1. Any person who owns or purchases a ship in violation of Article 27;
2. Any person who fails to purchase an insurance policy, in violation of Article 28;
3. Any person who engages in a transaction in violation of Article 29;
4. Any person who conducts business suspended during the period of business suspension after being sentenced to a disposition of business suspension under Article 44 (6) 1.
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 58 (Penalty Provisions)
Any person who falls under any of the following subparagraphs shall be punished by imprisonment with labor for not more than one year, or by a fine not exceeding ten million won: <Amended by Act No. 12820, Oct. 15, 2014>
1. Deleted; <by Act No. 9707, May 22, 2009>
2. Any person who fails to provide an investment prospectus under Articles 9 (1) and 15 or who has provided a false investment prospectus;
3. Any person who violates an order for disposition under Article 18 (3);
4. Any person who fails to deposit the securities with the Korea Securities Depository in violation of Article 36 (2);
5. Any person who has fails to manage the assets of a ship investment company by separating them from others in violation of Article 37 (3).
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
 Article 59 (Joint Penalty Provisions)
If the representative of a juristic person, or an agent, an employee or any other employed person of a juristic person or individual commits an offense prescribed in any of Articles 56 through 58 in connection with the affairs of said juristic person or individual, not only shall such actor be punished accordingly, but the juristic person or individual shall also be punished by a fine under the same Articles: Provided, That the same shall not apply where the juristic person or individual has not been negligent in paying due attention to or supervision over the relevant duties in order to prevent such offense.
[This Article Wholly Amended by Act No. 9707, May 22, 2009]
 Article 60 (Administrative Fines)
(1) Any of the following persons shall be punished by an administrative fine not exceeding five million won: <Amended by Act No. 9707, May 22, 2009; Act No. 11756, Apr. 5, 2013>
1. Any person that uses the name of ship investment company or ship investment management company, in violation of Article 5 (2) or 31 (4);
2. Any person that changes the authorized matters without obtaining authorization for change, in violation of the latter part of Article 13 (1);
3. Any person that leases a ship, in violation of Article 26 (1);
4. Any person that fails to submit the statements, etc. for settlement of accounts, in violation of Article 40 (2);
5. Any person that fails to prepare the statements, etc. for settlement of accounts, in violation of Article 42 (1);
6. Any person that fails to send the statements, etc. for settlement of accounts, in violation of Article 42 (2);
7. Any person that fails to perform an order for submission of data or report under Article 44 (1) or 45 (1);
8. Any person that refuses, hinders or evades an inspection under Article 44 (2) or 45 (2);
9. Any person that fails to comply with the measures under Article 44 (6) 2 or 3.
(2) Administrative fines under paragraph (1) shall be imposed and collected by the Minister of Oceans and Fisheries or the Financial Services Commission. <Amended by Act Nos. 8852 & 8863, Feb. 29, 2008; Act No. 9707, May 22, 2009; Act No. 11690, Mar. 23, 2013>
(3) through (5) Deleted. <by Act No. 9707, May 22, 2009>
[This Article Wholly Amended by Act No. 8821, Dec. 27, 2007]
ADDENDUM
This Act shall enter into force three months after the date of its promulgation.
ADDENDUM <Act No. 6966, Aug. 6, 2003>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 7428, Mar. 31, 2005>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 7641, Jul. 29, 2005>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation.
Article 2 (Transitional Measures concerning Permission of Ship Investment Management Company)
(1) A ship investment management company registered under the previous provisions at the time this Act enters into force shall be deemed to have obtained the permission of a ship investment management company under this Act: Provided, That it shall satisfy the requirements for permission under this Act within three months after the date this Act enters into force.
(2) Notwithstanding paragraph (1), a previous ship investment management company that has not satisfied the requirements for permission within three months after the date this Act enters into force may conduct its business of that referred to in Article 34 only as prescribed by Presidential Decree.
ADDENDUM <Act No. 8223, Jan. 3, 2007>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 8635, Aug. 3, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force one year and six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 44 Omitted.
ADDENDA <Act No. 8821, Dec. 27, 2007>
(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation: Provided, That the amended provisions of subparagraph 3 of Article 2, Articles 17 (1) and (2), 30 (2), 31 (1) 7, 36 (2), 44 (6), 45 (3), 53 (1), 55-2 and subparagraph 4 of Article 58 shall enter into force on February 4, 2009.
(2) (Applicability) The amended provisions of Articles 3 (3) and 6 shall apply to a ship investment company that obtains the first authorization of establishment after this Act enters into force.
ADDENDA <Act No. 8852, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 7 Omitted.
ADDENDA <Act No. 8863, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDA <Act No. 9707, May 22, 2009>
(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation.
(2) (Period of Validity) The amended provisions of Article 55-3 shall remain in effect until December 31, 2015.
(3) (Transitional Measures) For the purposes of the penalty provisions to any act committed before this Act enters into force, the previous provisions shall apply.
ADDENDA <Act No. 11690, Mar. 23, 2013>
Article 1 (Enforcement Date)
(1) This Act shall enter into force on the date of its promulgation.
(2) Omitted.
Articles 2 through 7 Omitted.
ADDENDA <Act No. 11756, Apr. 5, 2013>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Applicability to Special Cases concerning Ship Investment Companies Targeting at Professional Investors)
The amended provisions of Article 53-2 shall apply to ship investment companies established after this Act enters into force.
ADDENDUM <Act No. 12218, Jan. 7, 2014>
This Act shall enter into force three months after the date of its promulgation.
ADDENDA <Act No. 12539, Mar. 24, 2014>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures concerning Incompetent Persons, etc.)
A person under the adult guardianship and a person under the limited guardianship under the amended provisions of Article 7 (1) 1 shall be deemed to include the persons against whom the declaration of the incompetency or quasi-incompetency maintains its effect under Article 2 of the Addenda to the partially amended Civil Act (Act No. 10429).
ADDENDUM <Act No. 12820, Oct. 15, 2014>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 13448, Jul. 24, 2015>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 20 Omitted.
ADDENDA <Act No. 13453, Jul. 31, 2015>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 18 Omitted.
ADDENDUM <Act No. 15004, Oct. 31, 2017>
This Act shall enter into force on the date of its promulgation.