ENFORCEMENT DECREE OF THE STATE CREDIT MANAGEMENT ACT
Presidential Decree No. 5703, Jul. 15, 1971
Amended by Presidential Decree No. 11222, Sep. 6, 1983
Presidential Decree No. 12866, Dec. 29, 1989
Presidential Decree No. 14063, Dec. 31, 1993
Presidential Decree No. 14438, Dec. 23, 1994
Presidential Decree No. 17048, Dec. 29, 2000
Presidential Decree No. 17824, Dec. 30, 2002
Presidential Decree No. 18312, Mar. 17, 2004
Presidential Decree No. 19493, May 30, 2006
Presidential Decree No. 19507, jun. 12, 2006
Presidential Decree No. 20720, Feb. 29, 2008
Presidential Decree No. 20947, Jul. 29, 2008
Presidential Decree No. 21902, Dec. 24, 2009
Presidential Decree No. 22151, May 4, 2010
Presidential Decree No. 25155, Feb. 11, 2014
Presidential Decree No. 29181, Sep. 18, 2018
CHAPTER I GENERAL PROVISIONS
The purpose of this Decree is to provide for the matters delegated by the State Credit Management Act and matters necessary for the enforcement thereof. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 2 (Claims Governed by Provisions regarding Reporting) |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 3 (Claims Equivalent to Fines, etc.) |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 3-2 (Scope of Savings and Deposits) |
“Claims concerning savings and deposits of the State" in Article 3 (1) 3 of the Act means claims concerning savings and deposits (including national funds received by national treasury agents of the Bank of Korea) of the State in the Bank of Korea established under the Bank of Korea Act (hereinafter referred to as “the Bank of Korea”). [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 4 (Claims Partially Excluded from Application of the Act) |
"Claims prescribed by Presidential Decree" in Article 3 (2) 3 of the Act means claims against a foreign ambassador, diplomatic minister, a diplomat, or any other person equivalent thereto in the Republic of Korea. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 5 (Scope of Claims Partially Excluded from Application of the Act) |
| (1) | Articles 14-2, 14-3, 15, 18 through 22, 27 through 29, and 33 of the Act shall not apply to claims owed by a foreign country or an international organization as provided in Article 3 (2) 1 of the Act: Provided, That Articles 13 and 14 shall not apply to the claims specified by the Minister of Strategy and Finance, out of claims owed by a foreign country or an international organization. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
CHAPTER II CLAIMS MANAGEMENT AUTHORITY
| Article 6 (Delegation of Management, etc.) |
| (1) | If the head of a central government agency intends to delegate his/her duties of claims management to a public official of another central government agency or the head or a public official of a local government or intends to authorize such a person to act as his/her agent for claims management or to take partial charge of claims management pursuant to Article 6 of the Act, he/she shall obtain consent of the head of the central government agency or local government involved to the following matters: |
| 1. | The public official to whom he/she intends to delegate his/her duties or intends to authorize to act as his/her agent or to take partial charge; |
| 2. | The scope of administrative affairs to delegate, for which the public official shall act as his/her agent, or of which the public official shall take partial charge. |
| (2) | When the head of a central government agency delegates his/her duties of claims management to a public official of the central government agency, a public official of another central government agency, or the head or a public official of a local government or authorizes such a person to act as his/her agent for the purpose of managing claims or to take partial charge thereof, pursuant to Article 6 of the Act, he/she shall notify the Board of Audit and Inspection of the following matters: |
| 1. | The public official to whom he/she intends to delegate his/her duties or intends to authorize to act as his/her agent or to take partial charge; |
| 2. | The scope of administrative affairs to delegate, for which the public official shall act as his/her agent, or of which the public official shall take partial charge. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 7 Deleted. <by Presidential Decree No. 11222, Sep. 6, 1983> |
| Article 8 (Handing over Duties of Claims Management) |
| (1) | When the head of a central government agency intends to require a claims management officer to hand over his/her duties of claims management to another claims management officer under Article 9 (1) of the Act, he/she shall set the date on which such duties shall begin. |
| (2) | The claims management officer who shall hand over the duties of claims management shall deliver the following documents or articles to the claims management officer who shall take charge of the duties of claims management by the date on which such duties shall begin in accordance with paragraph (1): |
| 1. | Books concerning claims management; |
| 3. | Other documents and articles necessary for claims management. |
| (3) | Paragraphs (1) and (2) shall apply mutatis mutandis where the head of a central government agency hands over the duties of claims management to the head of another central government agency under Article 9 (2) of the Act. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 9 (When Claims Management Officer May Deal Concurrently with Cash Receipt and Disbursement) |
In any of the following circumstances, a claims management officer may concurrently handle cash receipt and disbursement pursuant to the proviso to Article 10 of the Act: | 1. | If he/she works for a diplomatic or consular mission in a foreign country; |
| 2. | If he/she works for a government office where he/she has to deal concurrently with the relevant duties due to lack of personnel. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
CHAPTER III STANDING RULES FOR CLAIMS MANAGEMENT
| Article 10 (Notice of Accrual or Attribution of Claims) |
| (1) | The notice referred to in Article 11-2 of the Act shall be given in writing with regard to the following matters: Provided, That such notice may be omitted if the person who shall give the notice holds a concurrent post as a claims management officer: |
| 1. | The name and address of the debtor (or the name and location of the corporation, if the debtor is a corporation); |
| 3. | The deadline for performance; |
| 4. | Why the claim has accrued; |
| 5. | When the claim has accrued; |
| 7. | Matters concerning interest and interest rates; |
| 8. | Matters concerning arrears; |
| 9. | Matters concerning the debtor’s property, business and other sources of income; |
| 10. | Matters concerning security; |
| 11. | Conditions attached to the claim; |
| 12. | Other matters determined by the head of the competent central government agency. |
| (2) | The notice shall be accompanied by documents or other articles proving matters specified in the subparagraphs of paragraph (1), if any. |
| (3) | If a transfer or change occurs with respect to the claim, of which a notice has been given under paragraph (1), the competent claims management officer shall, without delay, be notified of the transfer or change. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 11 (Claims Management Books) |
The forms of books in which records of claims management shall be kept in accordance with Article 12 of the Act (hereinafter referred to as “claims management book”) shall be prescribed by Ordinance of the Ministry of Strategy and Finance: Provided, That the claims management books may be substituted by the books determined by the head of a central government agency, if he/she finds it more efficient to manage specific claims that ordinarily accrue in the central government office with different books. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 12 (Claims Requiring No Recording) |
Claims that need not be recorded under the proviso to Article 12 of the Act are: <Amended by Presidential Decree No. 29181, Sept. 18, 2018> | 1. | Claims to fall under the jurisdiction of a claims management officer and found totally extinguished as a result of an investigation and examination conducted upon receipt of a notice of the accrual of claims under Article 11-2 of the Act; |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 13 (Payment Notices) |
| (1) | When a claims management officer intends to request a revenue collection officer to give a payment notice under the main sentence of Article 13 (1) of the Act or intends to give a payment notice by him/herself under the proviso to the same paragraph, he/she shall investigate the amount of the relevant claim, the deadline for performance, and whether any other term or condition breaches relevant statutes, or contracts. |
| (2) | When a claims management officer intends to request the payment notice under paragraph (1), he/she shall make the request by no later than 20 days before the deadline for performance of the relevant claims, and if he/she intends to give a payment notice by him/herself, he/she shall make such request by no later than 15 days before the deadline for performance: Provided, That a claims management officer shall request the payment notice or give a payment notice, without delay, after investigating and examining the relevant claims, if there is any unavoidable reason for preserving the claims. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 14 (Claims Not Requiring Payment Notices) |
| 1. | Claims specified in subparagraph 1 of Article 12; |
| 2. | Benefits partially returned by collecting deductions from benefits paid by the State. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 14-2 (Overdue Debts subject to Entrustment of Collection) |
In any of the following circumstances, the head of a central government agency may entrust the collection of overdue debts to a person pursuant to Article 14-2 (1) of the Act: | 1. | Where a delinquent debtor’s overdue debts exceed 100 million won; |
| 2. | Where the head of a central government agency finds it impracticable to collect overdue debts because a delinquent debtor has neither income nor property under his/her name. |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 14-3 (Method for Entrustment of Collection of Overdue Debts) |
| (1) | When the head of a central government agency intends to entrust a person with the functions under Article 14-2 (1) of the Act (hereinafter referred to as “collection of overdue debts”) pursuant to Article 14-2 (1) in order to recover claims unpaid (hereinafter referred to as “overdue debts”) even after a demand notice is issued under Article 14 (1) of the Act, he/she shall enter into an agreement on entrustment with the person entrusted with the collection of overdue debts under the aforesaid paragraph (hereinafter referred to as “entrusted agency”). |
| (2) | When the head of a central government agency enters into an agreement on entrustment under paragraph (1), he/she shall send an entrustment request to the entrusted agency, describing the following matters with regard to the overdue debts of each debtor from whom overdue debts shall be collected under Article 14-2 (1) 1 of the Act (hereinafter referred to as “delinquent debtor”): |
| 1. | The year in which the claim accrued; |
| 2. | The category of the claim; |
| 3. | The amount of the claim; |
| 4. | The deadline for performance. |
| (3) | When the head of a central government agency enters into an agreement on the entrustment of collection of overdue debts under paragraph (1), he/she shall notify each delinquent debtor of the entrustment without delay and shall notify the Minister of Strategy and Finance of the details of the entrustment. |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 14-4 (Restrictions on Scope of Persons Who can be Entrusted with Collection of Overdue Debts) |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 14-5 (Entrustment Fees for Collection of Overdue Debts) |
Entrustment fees referred to in Article 14-2 (4) of the Act shall be set by applying the ratio not exceeding the ratios prescribed by Ordinance of the Ministry of Strategy and Finance within 25/100 of any of the following amounts, out of the overdue debts that the relevant agency is entrusted to collect: | 1. | The amount paid by a delinquent debtor if he/she fully or partially pays his/her overdue debts; |
| 2. | The amount collected out of the amount of income or property of a delinquent debtor that the entrusted agency found and notified to the head of the competent central government agency. |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 14-6 (Termination of Entrustment of Collection of Overdue Debts) |
In any of the following circumstances, the head of a central government agency shall terminate the entrustment of collection of overdue debts:
| 1. | Where the claims have been paid or the extinctive prescription has completed, thus the delinquent debtor’s obligation to pay is extinguished; |
| 2. | Where the security provided by the delinquent debtor under Article 18 of the Act is sufficient to cover the overdue debts; |
| 3. | Where a special contract for the extension of payment is executed under Article 27 (2) of the Act with regard to a claim, the payment period of which has expired; |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 14-7 (Audit of Entrusted Agencies) |
When the head of a central government agency intends to audit an entrusted agency under Article 14-3 (1) of the Act, he/she shall inform the entrusted agency of the date, time, purposes, scope, etc. of the audit by no later than seven days before commencing the audit: Provided, That this shall not apply to emergency cases or where the giving of a prior notice can defeat the purpose of the audit because of destruction of evidence, etc. [This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 15 (Claim of Guarantor’s Performance) |
When the head of a central government agency claims a guarantor to perform an obligation under his/her jurisdiction under subparagraph 1 of Article 15 of the Act, he/she shall require the claims management officer of the relevant government agency to give a payment notice in accordance with Article 13. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 16 (Requests for Proceedings for Disposition on Default) |
If a claim collectible in the same manner as delinquent national taxes are collected under relevant statutes has not been fully or partially collected even after the expiration of the deadline given by the demand notice, the competent claims management officer shall request the person authorized to execute the disposition on default under relevant statutes to commence the proceedings for the disposition on default.
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 16-2 (Collection Prior to Deadline for Performance) |
| (1) | Any cause of moving up the deadline for performance under the main sentence of Article 16 of the Act means the ground on which the deadline for performance may be moved up in accordance with relevant statutes or terms and conditions of the relevant contract. |
| (2) | When a claims management officer intends to exercise the right to claim the performance of an obligation pursuant to paragraph (1) before the deadline for performance, he/she shall notify the competent revenue collection officer of the following matters: Provided, That a claims management officer him/herself shall give a notice to a debtor with regard to a claim regarding which he/she shall give a payment notice: |
| 1. | Grounds for changing the deadline for performance; |
| 2. | The original deadline for performance; |
| 3. | The changed deadline for performance. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 17 (Types of Security and Methods of Appraisal) |
| (1) | The types of security that may be provided by a debtor to preserve claims under Article 18 (1) of the Act are as follows: Provided, That if otherwise provided in relevant provisions of a statute or relevant terms and conditions of the relevant contract, such relevant provisions or terms and conditions shall apply: |
| 2. | Securities designated by the Minister of Strategy and Finance; |
| 4. | Insured assets, such as registered buildings, factory foundations, mining foundations, ships, aircraft, or construction machines. In such case, insurance shall expire at least 30 days after the end of the period during which security is required; |
| 5. | A payment guarantee issued by a financial institution or guarantor deemed reliable by the competent claims management officer. |
| (2) | The security provided under paragraph (1) shall be appraised in the following manners: |
| 1. | Listed securities: The last trading price at the exchange established with permission under Article 373-2 of the Financial Investment Services and Capital Markets Act (hereafter referred to as “the Exchange” in this subparagraph) as at the date on which they are provided as security: Provided, That securities that have never been traded in the Exchange shall be appraised using the last purchase price method; |
| 2. | Land, buildings, factory foundations, mining foundations, ships, aircraft, or construction machines: The standard market price determined under the Local Tax Act or the value appraised by an appraisal agency or a person who has expertise in the appraisal of the relevant property. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 17-2 (Method for Providing Security) |
| 1. | A person who intends to provide cash, securities, or a payment guarantee as security shall deliver the security to the claims management officer: Provided, That, in case of registered securities, the person shall register his/her intention to provide the securities as security and shall deliver the certificate of registration; |
| 2. | A person who intends to provide land, a building, a factory foundation, a mining foundation, a ship, an aircraft, or a construction machine as security shall deliver the relevant certificate of records of registration, certificate of registration, or registration certificate to the competent claims management officer, and the claims management officer shall proceed with registration to establish a mortgage therein. |
| (2) | If a secured obligation is not duly performed, the competent claims management officer shall satisfy the obligation with the security and return the remainder, if any, to the debtor. |
| (3) | Upon receipt of security, a claims management officer shall enter relevant details in the book prescribed by the Minister of Strategy and Finance and shall take custody of the security. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 18 (Procedures for Discontinuance of Management) |
| (1) | When a claims management officer intends to discontinue his/her duty to preserve or collect a claim (hereinafter referred to as "discontinuance of management") pursuant to Article 24 (1) of the Act, he/she shall investigate and ascertain the debtor’s whereabouts and whether the debtor has any property with local administrative agencies and tax offices, as prescribed by Ordinance of the Ministry of Strategy and Finance: Provided, That this shall not apply where the amount of claim is less than 100,000 won. |
| (2) | When a claims management officer intends to discontinue management pursuant to Article 24 (1) of the Act, he/she shall present the documents containing the following matters to the head of the central government agency, to which he/she belongs, for approval thereof: |
| 1. | Grounds for the discontinuance of management; |
| 2. | The debtor’s whereabouts; |
| 3. | The current status of the debtor’s property; |
| 4. | Other matters necessary for the discontinuance of management. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 19 (Circumstances in which Management May be Discontinued) |
| 1. | Where a debtor’s whereabouts are uncertain and the value of attachable property exceeds expenses incurred in compulsory execution, but the excess amount is smaller than the amount of privileged debts; |
| 2. | Where it is unlikely for a debtor to have a domicile or abode in the Republic of Korea after the competent claims management officer claims the performance of his/her obligations or take measures for preserving the relevant claims and the value of the property to be attached does not exceed the aggregate of the expenses incurred in compulsory execution and privileged debts. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
[Moved from Article 18; Former Article 19 moved to Article 18]
| Article 19-2 (Order of Priority in Collection of Claims) |
The order of priority in the collection of claims is as follows: Provided, That, if otherwise provided in any other statute or a relevant contract, such statue or relevant contract shall apply:
| 1. | Expenses incurred in the disposition on default; |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 20 (Notification of Extinction of Claims) |
A notice of extinction of claims under Article 25 of the Act shall be given at the time specified in the following: Provided, That the notice may be omitted if the person who shall give a notice of extinction of claims concurrently serves as claims management officer: | 1. | Notice by a revenue collection officer: When he/she receives a notice of receipt of a claim that constitutes revenue from the person who has received the payment of the claim; |
| 2. | Notice by a public official in charge of the disbursement and receipt of revenue or by the Bank of Korea: When the public official or the Bank of Korea receives the payment of a claim that does not constitute revenue; |
| 3. | Notice by a person in charge of the disbursement, receipt, and safekeeping of any asset, other than cash (including securities paid in lieu of cash under the Revenue Payment by Securities Act) in accordance with relevant statutes: When the person receives payment in accordance with relevant statutes; |
| 4. | Notice by a person who has caused the accrual of a claim by entering into a contract under subparagraph 1 of Article 11-2 of the Act or by doing any other act: When the person cancels or terminates the contract or act. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 21 (Provision of Data about Overdue Debts or Discontinuance of Management) |
| (1) | “Circumstances specified by Presidential Decree” in the proviso to Article 25-2 (1) of the Act mean circumstances in which any of the following events occurs to a delinquent debtor or a debtor. Specific criteria necessary for the head of a central government agency to determine whether any of the following applies to a delinquent debtor or a debtor shall be prescribed by the Minister of Strategy and Finance: |
| 1. | Where a delinquent debtor or a debtor sustains severe damage to his/her property due to a disaster or theft; |
| 2. | Where a delinquent debtor or a debtor sustains a substantial loss on his/her business; |
| 3. | Where the business of a delinquent debtor or a debtor is in a serious crisis; |
| 4. | Where collection of overdue debts is deemed possible because business has returned to normal since the data about overdue debts or discontinuance of management under the main sentence of Article 25-2 (1) of the Act (hereinafter referred to as “data about overdue debts or discontinuance of management”) have not been provided. |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 21-2 (Creation, etc, of Data Files about Overdue Debts or Discontinuance of Management) |
| (1) | If the head of a competent central government agency processes the data about overdue debts or discontinuance of management by using an electronic information processing system, he/she may create data files about overdue debts or discontinuance of management (referring to data about overdue debts or discontinuance of management recorded or stored in magnetic tapes, magnetic disks, or any other similar media; the same shall apply hereinafter). |
| (2) | The arrangement, management and storage of data files about overdue debts or discontinuance of management under paragraph (1) and other necessary matters shall be determined by the head of each central government agency. |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 21-3 (Requests, etc, for Data about Overdue Debts or Discontinuance of Management) |
| (1) | A person who intends to request data about overdue debts or discontinuance of management pursuant to the main sentence of Article 25-2 (1) of the Act (hereafter referred to “requester” in this Article) shall submit a document containing the following details to the head of the competent central government agency: |
| 1. | The requester’s name and address (or the name and location of the corporation, if the requester is a corporation); |
| 2. | The contents of the requested data and the purpose of use. |
| (2) | Upon receipt of a request for data about overdue debts or discontinuance of management under paragraph (1), the head of a central government agency may provide data about overdue debts or discontinuance of management in files or documents. |
| (3) | If the data about overdue debts or discontinuance of management provided under paragraph (2) cease to constitute data about overdue debts or discontinuance of management because of the payment of overdue debts or the revocation of discontinuance of management, a notice of the relevant facts shall be given to the requester within 15 days of the occurrence of the relevant event. |
| (4) | Unless otherwise provided in paragraphs (1) through (3), matters necessary for requesting and providing data about overdue debts or discontinuance of management and other matters shall be prescribed by Ordinance of the Ministry of Strategy and Finance. |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
CHAPTER IV CHANGE IN PARTICULARS OF CLAIMS AND RELEASE OF CLAIM
| Article 22 (Claims Ineligible for Special Contract for Extension of Payment Period) |
"Claims determined by Presidential Decree" in Article 27 (1) of the Act means: <Amended by Presidential Decree No. 29181, Sept. 18, 2018> | 1. | Profits, surplus funds, or revenues to be paid to the State under relevant statutes; |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 23 (Procedures for Special Contract for Extension of Payment Period) |
| (1) | If a debtor intends to obtain an extension of the payment period under a special contract or by a disposition under Article 27 (1) of the Act (hereinafter referred to as “special contract for the extension of payment period”), he/she shall file an application for a special contract for the extension of payment period (including an electronic application form), describing the following matters, with the competent claims management officer. In such case, the claims management officer shall verify the certified transcript of the resident registration card of the applicant (or the corporation registration certificate, if the applicant is a corporation) through the joint use of administrative information under Article 36 (1) of the Electronic Government Act or shall require the applicant to submit the certified transcript of his/her resident registration card, if the applicant is an individual and refuses to consent to verification in such a manner: |
| 1. | The debtor's name and address (or the name and location of the corporation, if the debtor is a corporation); |
| 3. | When the claim has accrued; |
| 4. | Why the claim has accrued; |
| 5. | The original and extended payment period; |
| 6. | Matters concerning security for the claim; |
| 7. | Why the payment period is extended; |
| 8. | Matters concerning security and interest on the extension of the payment period; |
| 9. | The statement that the debtor agrees to conditions attached under Article 30. |
| (2) | Upon receipt of an application from a debtor for a special contract for the extension of payment period under paragraph (1), a claims management officer shall have local administrative agencies and tax offices investigate and confirm whether the debtor owns property, as prescribed by Ordinance of the Ministry of Strategy and Finance: Provided, That the foregoing shall not apply where the amount of claim is less than 100,000 won. |
| (3) | If a claims management officer finds, as a result of such investigation and confirmation of whether a debtor owns property under paragraph (2), that the requirements under Article 27 (1) of the Act are met and intends to enter into a special contract for the extension of payment period, he/she shall present a statement describing the grounds for the special contract for the extension of payment period, a report on investigation into the debtor’s property, a copy of the relevant application, and other necessary documents to the head of the central government agency to which he/she belongs for approval. |
| (4) | When a claims management officer intends to enter into a special contract for the extension of payment period with approval from the head of the central government agency to which he/she belongs, he/she shall notify the debtor of the following: |
| 1. | The type and amount of claim and the original and extended payment period |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 24 (Special Contract for Extension of Payment Period for Claims Payable in Installments) |
When a claims management officer executes a special contract for the extension of payment period under Article 27 (3) of the Act, he/she shall not extend the payment period of the final installment further than the extended payment period of the first installment: Provided, That if deemed favorable to collection, the payment period of the final installment may be extended further than the extended payment period of the first installment. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 25 (Type of Security for Deferred Payment and Procedures for Provision of Security) |
| (2) | If a claims management officer intends to enter into a special contract for the extension of payment period of secured claims, but the security is deemed inadequate, he/she shall require the debtor to provide additional security or replace the guarantor or security with another guarantor or security. |
| (3) | If a claims management officer finds it substantially impracticable for a debtor to provide security before entering into a special contract for the extension of payment period of claims eligible for the special contract for the extension of payment period, he/she may set out a period during which the debtor shall provide security after entering into the special contract for the extension of payment period. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 26 (Interest Rates on Deferred Payment) |
The interest rate on a claim, the payment period of which is extended by a special contract under Article 29 (1) of the Act, shall be based on the interest rate on general loans extended by banks as defined in Article 2 (1) 2 of the Banking Act as at the date of execution of the special contract for the extension of payment period. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 27 (Debtors Eligible for Exemption from Providing Security for Deferred Payment) |
| 1. | A debtor the sum of whose claims owed to the same person does not exceed 300,000 won; |
| 2. | A debtor who enters into a special contract for the extension of payment period with regard to a claim of restitution for unjust enrichment not resulting from the debtor’s intentional conduct or gross negligence; |
| 3. | A debtor who has no asset to be provided as security and has no person to be a guarantor; |
| 4. | A debtor in whose case requiring the provision of security is likely to substantially hinder the performance of a public works project. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 28 (Debtors Eligible for Exemption from Paying Interest on Deferred Payment) |
The following debtors may be exempted from paying interest on deferred payment of claims, the payment period of which is extended by a special contract under the proviso to Article 29 (1) of the Act: | 2. | A debtor whose total amount of interest on deferred payment is less than one thousand won. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 29 (Circumstances in which Acquiring Executive Title is Unnecessary) |
| 1. | Where a claim, the payment period of which is extended by a special contract, is secured by adequate collateral; |
| 2. | Circumstances that constitute subparagraph l or 2 of Article 27. |
| (2) | If a claims management officer finds that a debtor is unable to pay expenses incurred in acquiring an executive title, it may elect not to acquire the executive title until the debtor becomes capable of paying the expenses. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 29-2 (Measures for Acquisition of Executive Title) |
If a claims management officer deems it necessary to acquire the executive title to a claim when he/she enters into a special contract for the extension of payment period under Article 29 (1) of the Act, he/she shall notify the debtor of the action to be taken by the debtor and the deadline set for the action: Provided, That a claims management officer may require a debtor to present a debt certificate in the form prescribed by Ordinance of the Ministry of Strategy and Finance by a given deadline after entering into the special contract for the extension of payment period, if it is unnecessary to acquire the executive title to a claim. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 30 (Conditions Attached to Special Contract for Extension of Payment Period) |
| (1) | The following conditions shall be attached to a special contract for the extension of payment period under Article 29 (3) of the Act: |
| 1. | Where conditions are required for the preservation of claims: The condition under which the claims management officer may ask questions to the debtor or guarantor about the current status of business and assets, may inspect accounting books, documents, and other articles, or may require the debtor to submit reports and other reference materials; |
| 2. | Where any of the following grounds exist: The condition under which the claims management officer may claim performance before the extended deadline for performance: |
| (a) | If a debtor acts, or is anticipated to act, detrimentally to the State by hiding or destroying his/her property; |
| (b) | If a debtor assumes any other debt by fraud; |
| (c) | If a debtor is negligent in performing his/her obligations in installments, where the deadline for performance has been extended and he/she is permitted to perform his/her obligations in installments; |
| (e) | If a debtor breaches the condition set forth in subparagraph 1; |
| (f) | If the ground for the extension of the deadline for performance ceases to exist as a result of a change in the debtor’s financial position or other circumstances; |
| (g) | If a debtor fails to perform his/her obligations under Articles 25 (3) and 29-2 due to a cause attributable to him/her. |
| (2) | A contract may include the condition stipulating that the debtor may be required to provide security or to pay interest on deferred payment if there is any change in the debtor’s financial position or other circumstances, even where it is agreed to exempt the debtor from providing security or paying interest on deferred payment under the proviso to Article 29 (1) of the Act. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| (1) | A debtor who intends to be qualified for release from obligations (including arrears) under Article 31 or 32 of the Act shall file an application for release (including an application in an electronic document) in the form prescribed by Ordinance of the Ministry of Strategy and Finance with the competent claims management officer. In such case, the claims management officer shall verify the certified transcript of the resident registration card of the applicant (or the corporation registration certificate, if the applicant is a corporation) through the joint use of administrative information under Article 36 (1) of the Electronic Government Act or shall require the applicant to submit the certified transcript of his/her resident registration card, if the applicant is an individual and refuses to consent to verification in such a manner. |
| (2) | Upon receipt of an application from a debtor for release from obligations under paragraph (1), a claims management officer shall have local administrative agencies and tax offices investigate and confirm whether the debtor has any property, as prescribed by Ordinance of the Ministry of Strategy and Finance: Provided, That this shall not apply where the amount of claim is less than 100,000 won. |
| (3) | When a claims management officer finds, as a result of such investigation and confirmation of whether a debtor has any property under paragraph (2), that the debtor meets the requirements under Article 31 of the Act and thus intends to release the debtor from obligations, he/she shall present the following documents to the head of the central government agency to which he/she belongs for approval: |
| 1. | A statement of grounds for release; |
| 2. | A report on the investigation into the current status of the debtor’s property; |
| 3. | A copy of the relevant application for release; |
| 4. | Other documents necessary for release from obligations. |
| (4) | When a claims management officer releases a debtor from obligations with approval from the head of the central government agency to which he/she belongs, he/she shall notify the debtor of the following: |
| 1. | The deadline for the performance of released obligations, the type and amount of released obligations, and the date of release; |
| 2. | Conditions of release, in the case of claims under a special contract for the extension of payment period under Article 31 (2) of the Act. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 32 (Scope of Claims Eligible for Exemption from Payment of Arrears) |
| 1. | Tuition fees or boarding fees collectible by an educational facility established by the State; |
| 2. | Expenses collectible from patients by a medical facility established by the State; |
| 3. | The refund of unjust enrichment not resulting from the debtor’s intentional conduct or gross negligence. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
CHAPTER V SUPPLEMENTARY PROVISIONS
| Article 33 (Matters to be Stipulated in Contracts) |
| 1. | The payment of arrears, where the debtor fails to perform his/her obligations by the deadline for performance; |
| 2. | The full or partial collection of claims before the deadline for performance, where the contract stipulates the condition that obligations may be paid in installments and the debtor fails to pay an installment on due date; |
| 3. | The provision of additional security or the replacement of a guarantor or assets provided as security, where a contract has been executed for a secured claim, but the value of security decreases or the guarantor becomes inadequate; |
| 4. | The investigation into the current status of the business or assets of a debtor or guarantor or the request for the submission of data thereon, where necessary for the preservation of claims; |
| 5. | The full or partial collection of claims before the deadline for performance, where the debtor fails to comply with the request made under subparagraph 4. |
| (2) | A contract on a loan provided for a specified purpose shall stipulate the following, in addition to the matters specified in paragraph (1): |
| 1. | The full or partial collection of the loan before the deadline for performance, where the debtor fails to use the loan for the specified purpose by the given deadline; |
| 2. | The full or partial collection of the loan before the deadline for performance, where the debtor fails to perform terms and conditions of the contract for the loan in good faith. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 34 (Report on Present Claim Amount) |
| (1) | A report on the present claim amount prepared under Article 36 of the Act shall describe the following: |
| 1. | The classification of claims by account and by type; |
| 2. | The details of an increase or decrease in the amount of claim and whether the due date for payment has come. |
| (2) | The valuation and accounting for the preparation of reports on the present claim amount under paragraph (1) shall be based on the national accounting standards under Article 11 of the National Accounting Act. |
| (3) | The form for reports on the present claim amount under paragraph (1) shall be prescribed by Ordinance of the Ministry of Strategy and Finance. |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 35 (Reclassification of Claims Lapsed Prior to Deadline for Settlement of Disbursement and Receipt) |
In preparing a report on the present claim amount under Article 36 of the Act, an amount received by the deadline for the settlement of disbursement and receipt of claims classified as the revenue for the pertinent year or claims classified as the refund of the expenditure for the pertinent year shall be included in the relevant account of revenue or expenditure for the pertinent year. [This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 36 (Payment of Monetary Rewards, etc.) |
| (1) | An amount specified in the following table may be paid as a monetary reward to a person who reports a delinquent debtor’s hidden property in accordance with Article 38 (1) of the Act, based on the amount collected from the hidden property so reported (hereafter referred to as “collected amount” in this Article): Provided, That an amount exceeding 100 million won shall not be paid, if a monetary reward exceeds 100 million won: |
| Recovered Amount | Amount Payable | | Not less than 20 million won, not more than 200 million won | An amount equivalent to 15 percent of the collected amount | | Greater than 200 million won, not more than 500 million won | 30 million won + An amount equivalent to 10 percent of the amount exceeding 200 million won out of the collected amount | | Greater than 500 million won | 60 million won + An amount equivalent to 5 percent of the amount exceeding 500 million won out of the collected amount |
|
| (3) | “Assets specified by Presidential Decree” in Article 38 (2) 3 of the Act mean real property registered in the name of a debtor him/herself in the Republic of Korea. |
| (4) | The head of a central government agency shall pay a monetary reward under Article 38 (1) of the Act within two months from the end of the month during which overdue debts of a debtor who has hidden his/her property are collected in cash. |
| (5) | If two or more reports are filed with respect to the same case where a monetary reward shall be paid to a person who reports a delinquent debtor’s hidden property under Article 38 (1) of the Act, the monetary reward shall be paid only to the first person who files such report. |
| (6) | Unless otherwise provided in paragraphs (4) and (5), matters necessary for the method for payment of monetary rewards shall be determined in detail by the Minister of Strategy and Finance. |
[This Article Newly Inserted by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 37 (Consultation on Statutes concerning Claims Management) |
When the head of a central government agency intends to prepare a bill to enact statutes relating to claims management and submit it to the Ministry of Government Legislation, he/she shall first consult thereon with the Minister of Strategy and Finance.
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
| Article 38 (Handling of Personally Identifiable Information) |
| 6. | Administrative affairs concerning special contracts for the extension of payment period under Article 23; |
[This Article Wholly Amended by Presidential Decree No. 25155, Feb. 11, 2014]
ADDENDUM
This Decree shall enter into force on the date of its promulgation.
ADDENDUM <Presidential Decree No. 11222, Sep. 6, 1983>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 12866, Dec. 29, 1989>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 14063, Dec. 31, 1993>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 1994.
Articles 2 through 7 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. 17048, Dec. 29, 2000>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2001.
Articles 2 through 8 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. 18312, Mar. 17, 2004>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 19493, May 30, 2006>
Article 1 (Enforcement Date)
This Decree shall enter into force on June 1, 2006.
Articles 2 through 4 Omitted.
ADDENDUM <Presidential Decree No. 19507, Jun. 12, 2006>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 20720, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 8 Omitted.
ADDENDA <Presidential Decree No. 20947, Jul. 29, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on February 4, 2009. (Proviso Omitted.)
Articles 2 through 28 Omitted.
ADDENDUM <Presidential Decree No. 21902, Dec. 24, 2009>
This Decree shall enter into force on January 1, 2010.
ADDENDA <Presidential Decree No. 22151, May 4, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on May 5, 2010.
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 22493, Nov. 15, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on November 18, 2010.
Articles 2 through 5 Omitted.
ADDENDUM <Presidential Decree No. 24317, Jan. 16, 2013>
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
ADDENDA <Presidential Decree No. 25155, Feb. 11, 2014>
Article 1 (Enforcement Date)
This Decree shall enter into force on February 14, 2014.
Article 2 Omitted.
ADDENDA <Presidential Decree No. 29181, Sep. 18, 2018>
Article 1 (Enforcement Date)
This Decree shall enter into force on September 21, 2018.
Articles 2 through 25 Omitted.