ACT ON SALE OF BUILDING UNITS
Act No. 7244, Oct. 22, 2004
Amended by Act No. 8635, Aug. 3, 2007
Act No. 8852, Feb. 29, 2008
Act No. 8972, Mar. 21, 2008
Act No. 8974, Mar. 21, 2008
Act No. 9060, Mar. 28, 2008
Act No. 9593, Apr. 1, 2009
Act No. 9857, Dec. 29, 2009
Act No. 10252, Apr. 12, 2010
Act No. 10462, Mar. 9, 2011
Act No. 10580, Apr. 12, 2011
Act No. 10719, May 24, 2011
Act No. 11467, jun. 1, 2012
Act No. 11690, Mar. 23, 2013
Act No. 13805, Jan. 19, 2016
Act No. 14791, Apr. 18, 2017
Act No. 14934, Oct. 24, 2017
Act No. 16415, Apr. 30, 2019
Act No. 16484, Aug. 20, 2019
The purpose of this Act is to protect persons who acquire buildings in units and to contribute to the sound development of the national economy by securing transparency in the process of sale of buildings in units and safety in transactions by prescribing matters concerning procedures for the sale of buildings in units and methods thereof.
[This Article Wholly Amended on Mar. 9, 2011]
The terms used in this Act shall be defined as follows: <Amended on Jun. 1, 2012>
| 2. | The term "sale of buildings in units" means fully or partially selling buildings constructed by a seller of buildings in units under subparagraph 3 to two or more persons: Provided, That this shall not apply where a building constructed to be used for two or more purposes among the uses of a building under Article 2 (2) of the Building Act is sold, and the floor area of a part corresponding to such uses is above the scope prescribed in Article 3 (1) 1, and all of such part is sold to one person; |
| 4. | The term "acquisitor of buildings in units" means persons who have concluded a contract to acquire buildings in units with a seller of buildings in units as prescribed in Article 6 (3) through (5). |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 3 (Scope of Application) |
| (1) | This Act shall apply to any of the following buildings, which shall be constructed with a building permit issued under Article 11 of the Building Act and sold in units before the issuance of approval for use (hereinafter referred to as "approval for use") under Article 22 of the same Act: |
| 1. | Buildings, the total floor area (referring to the floor area under Article 84 of the Building Act) of which to be sold in units is not less than 3,000 square meters; |
| 2. | Buildings with use and scale prescribed by Presidential Decree, such as facilities for business. |
| (2) | Notwithstanding paragraph (1), this Act shall not apply to any of the following buildings: <Act No. 11467, Jun. 1, 2012> |
| 1. | Housing and welfare facilities under the Housing Act; |
| 4. | Welfare facilities for the aged under the Welfare of Older Persons Act; |
| (3) | Notwithstanding the proviso to subparagraph 2 of Article 2 and paragraph (2), Articles 6-3 (3) and 10 (2) 5 shall apply to the resale or mediation of resale of a building purchased through a method not falling under the sale of a building in units pursuant to the proviso to subparagraph 2 of Article 2 or to a building corresponding to paragraph (2) 5 and 6. <Newly Inserted on Jun. 1, 2012> |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 4 (Timing for Selling Buildings in Units, etc.) |
| (1) | Sellers of buildings in units shall sell buildings in units according to the following classifications: |
| 2. | Where a joint and several guarantee for approval for use of the relevant building is obtained from two or more other building contractors and is notarized: After construction of 2/3 or more of the structural frame is completed. |
| (2) | With reference to the application of paragraph (1) 1, where a trust deed has been concluded in which a trust company acts as a seller of buildings in units, no separate trust deed for sale of buildings in units is necessary after a statement on the commencement of construction is made. |
| (3) | "Guarantee for sale of buildings in units" under paragraph (1) 1 means guarantee assuming responsibility for the implementation of sale of buildings in units (including approval for use) of the relevant buildings or refund of already paid price of buildings in units (limited to cases where acquisitors of buildings in units desire) where sellers of buildings in units cannot implement a contract of sale of buildings in units on grounds of bankruptcy, etc. |
| (4) | The methods of and standards for a trust deed and agency contract under paragraph (1) 1, and the kinds and scope of financial institutions, etc. that can guarantee the sale of buildings in units shall be prescribed by Presidential Decree. |
| (6) | When sellers of buildings in units intend to sell buildings in units, they shall secure ownership of a site on which buildings are to be constructed: Provided, That where such ownership belongs to the State or a local government, or is prescribed by Presidential Decree, this shall not apply. |
| (7) | When a mortgage, security right to provisional registration, leasehold on a deposit basis, superficies or registered right of lease of real estate has been created over a site, the ownership of which was secured as prescribed in paragraph (6), sellers of buildings in units shall cancel it: Provided, That in cases prescribed by Presidential Decree, such as one that sellers of buildings in units are the State, a local government, this shall not apply. |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 5 (Statement of Sale of Buildings in Units) |
| (1) | When sellers of buildings in units intend to sell buildings in units, they shall make a statement thereof to persons authorized to issue permits (hereinafter referred to as "persons authorized to issue permits") under Article 11 of the Building Act. |
| (2) | When sellers of buildings in units make a statement of selling buildings in units as prescribed in paragraph (1), they shall submit documents prescribed by Presidential Decree, such as a trust deed, agency contract, certificate of registered matters of sites: Provided, That this shall not apply to documents verified by persons authorized to issue permits through common use of administrative information under Article 36 (1) of the Electronic Government Act. <Amended on Apr. 12, 2011> |
| (3) | Persons authorized to issue permits shall examine the details of statement of sale of buildings in units, and accept the statement of sale of buildings in units where such statement conforms to this Act and notify the sellers of buildings in units of such fact. |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 6 (Methods of Sale of Buildings in Units, etc.) |
| (1) | After sellers of buildings in units are notified of acceptance of statement of sale of buildings in units as prescribed in Article 5 (3), they shall publicly invite persons to acquire buildings in units through advertising campaigns. In such cases, persons to acquire buildings in units of a purpose and scale prescribed by Presidential Decree shall be publicly invited by means of the internet. <Amended on Oct. 24, 2017> |
| (2) | Advertising campaigns under paragraph (1) shall contain matters prescribed by Presidential Decree, such as the location, use, size and seismic design of buildings. <Amended on Apr. 18, 2017> |
| (3) | Sellers of buildings in units shall select persons to acquire buildings in units by means of an open lottery from among persons who have applied to acquire buildings in units in accordance with advertising campaigns under paragraph (1). |
| (4) | Sellers of buildings in units shall conclude contracts of sale of buildings in units with persons selected to acquire buildings in units under paragraph (3), and the contracts of sale of buildings in units shall contain important matters that can influence the conclusion of contracts for sale of buildings in units and prescribed by Presidential Decree, such as indication of buildings for sale in units (including the location and size of common spaces), kinds of a trust deed, agency contract or contract of guarantee for the sale of buildings in units, title of persons engaged in trust business, institutions guaranteeing the sale of buildings in units. <Amended on Aug. 20, 2019> |
| (5) | Where portions remain after selecting persons to acquire buildings in units as prescribed in paragraph (3) or portions remain after concluding contracts of sale of buildings in units as prescribed in paragraph (4), persons to acquire such remaining portions shall be selected according to methods prescribed by Presidential Decree. In such cases, paragraph (4) shall apply to the conclusion of contracts with persons selected to acquire buildings in units. |
| (6) | Procedure, methods, etc. for public invitation under paragraph (1) shall be prescribed by Presidential Decree. <Newly Inserted on Oct. 24, 2017> |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 6-2 (Priority Sale of Buildings in Units to Residents) |
| (1) | Where sellers of buildings in units intend to sell buildings in units in an overheated speculation district designated under Article 63 (1) of the Housing Act or a district subject to adjustment designated under Article 63-2 (1) 1 of the said Act, they shall preferentially designate persons to acquire buildings in units from among persons who have applied to acquire buildings in units, who are residents (including corporations, the location of main office of which is in such area; the same shall apply hereinafter) of such area in which the relevant buildings are constructed as of the date of statement of sale of buildings in units within 20/100 of the portion of buildings to be sold in units, as prescribed by Presidential Decree. In such cases, sellers of buildings in units shall make it clear in the advertisements of sale of buildings in units. <Amended on Jan. 19, 2016; Oct. 24, 2017> |
| (2) | Paragraph (1) shall apply only to cases where the first public invitation under Article 6 (1) has been made. |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 6-3 (Restrictions on Resale of Buildings Sold in Units) |
| (1) | No acquisitor of buildings in units who has acquired parcels of buildings of a purpose and scale prescribed by Presidential Decree or owner thereof in an overheated speculation district designated under Article 63 (1) of the Housing Act or a district subject to adjustment designated under Article 63-2 (1) 1 of the said Act, shall resell the status of acquisitors of buildings in units or such buildings (including sale, donation and all other activities which cause the alteration of rights, however, excluding cases of inheritance; the same shall apply hereinafter), or mediate the resale thereof within a period to be prescribed by Presidential Decree, which shall be determined within the period from the date of concluding a contract of acquiring buildings in units to one year after approval for use thereof. In such cases, the period during which resale is restricted may be prescribed differently by Presidential Decree considering administrative districts and overheated speculation districts designated under Article 63 (1) of the Housing Act or a district subject to adjustment designated under Article 63-2 (1) 1 of the said Act, etc. <Amended on Jan. 19, 2016; Oct. 24, 2017> |
| (2) | As for buildings not falling under paragraph (1) for which sellers of buildings in units and acquisitors of buildings in units have concluded contracts under Article 6 (4), no one shall resell such buildings to two or more persons or mediate the resale thereof before approval for use thereof. |
| (3) | No building purchased through a method not corresponding to the sale of a building in units under the proviso to subparagraph 2 of Article 2 or a building falling under Article 3 (2) 5 and 6 shall be sold or mediated for sale to two or more persons before the use thereof is approved. <Newly Inserted on Act No. 11467; Jun. 1, 2012> |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 6-4 (Cancellation of Contract of Selling Buildings in Units) |
In any of the following cases, persons authorized to issue permits or sellers of buildings in units may cancel contracts with acquisitors of buildings in units:
| 1. | Where acquisitors of buildings in units have acquired buildings in units under Article 6-2 (1) by deceit or other fraudulent means; |
| 2. | Where acquisitors of buildings in units have resold buildings acquired in units, in violation of Article 6-3 (1) or (2). |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 7 (Modification of Designs) |
| (1) | Where sellers of buildings in units intend to modify designs prescribed by Presidential Decree, which may seriously influence the interests of acquisitors of buildings in units, such as an increase or decrease in the size of buildings or in the number of floor before approval for use of buildings sold in units, they shall obtain consent of all relevant acquisitors of buildings in units. |
| (2) | Where sellers of buildings in units intend to modify designs prescribed by Ordinance of the Ministry of Land, Infrastructure and Transport, which do not fall under the modification of designs prescribed in paragraph (1), they shall notify all relevant acquisitors of buildings in units of the details thereof in advance. <Amended on Mar. 23, 2013> |
| (3) | Necessary matters, such as timing and procedure for consent and notification, under paragraphs (1) and (2) shall be prescribed by Ordinance of the Ministry of Land, Infrastructure and Transport. <Amended on Mar. 23, 2013> |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 8 (Payment of Price of Buildings Sold in Units) |
| (1) | The price of buildings sold in units that sellers of buildings in units receive from the acquisitors of buildings in units shall be divided into contract deposit, intermediate payment and remainder. |
| (2) | The ratio of contract deposit, intermediate payment and remainder under paragraph (1) and the timing when such payments can be received shall be prescribed by Presidential Decree. |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 9 (Corrective Orders) |
| (1) | Where the details of advertisements of sale of buildings in units are found to be different from the details of statement of sale of buildings in units accepted under Article 5 (3), or not to include matters under Article 6 (2), persons authorized to issue permits shall immediately issue a corrective order to sellers of buildings in units and announce such fact via the information and communication network operated by such persons authorized to issue permits. |
| (2) | Where sellers of buildings in units are issued a corrective order under paragraph (1), they shall announce the details of such corrective order and matters to be corrected according to methods prescribed by Presidential Decree within 10 days from the date such corrective order is issued. |
| (3) | Where sellers of buildings in units have selected persons to acquire buildings in units or have concluded contracts of sale of buildings in units as prescribed in Article 6 before implementing a corrective order under paragraph (2), they shall notify such persons selected to acquire buildings in units or acquisitors of buildings in units, of the details of announcement under paragraph (2). |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 9-2 (Reporting and Supervision) |
| (1) | The Minister of Land, Infrastructure and Transport may request persons authorized to issue permits to submit necessary data or to report in relation to the statement of sale of buildings in units, etc. of sellers of buildings in units. <Amended on Mar. 23, 2013> |
| (2) | Where persons authorized to issue permits have been requested to submit data or to report as prescribed in paragraph (1), they shall comply with such request unless any extenuating circumstance exists. |
| (3) | Where the Minister of Land, Infrastructure and Transport acknowledges that orders or disposition issued by persons authorized to issue permits violates this Act, he/she may order to revoke or modify such orders or disposition, or to take other necessary measures. <Amended on Mar. 23, 2013> |
| (4) | Persons authorized to issue permits who have received an order to take necessary measures under paragraph (3) shall, without delay, report the results of correction, etc. to the Minister of Land, Infrastructure and Transport. <Amended on Mar. 23, 2013> |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 9-3 (Investigation and Inspection, etc.) |
| (1) | The Minister of Land, Infrastructure and Transport or persons authorized to issue permits may require a seller of buildings in units to submit data and report matters necessary for the enforcement of this Act, and have public officials under his/her jurisdiction enter the office concerned to investigate or inspect relevant books, ledger, or other documents. |
| (2) | A public official who enters and performs an inspection, etc. under paragraph (1) shall carry with him/her a certificate indicating his/her authority and present it to interested persons. |
[This Article Newly Inserted on Oct. 24, 2017]
| Article 10 (Penalty Provisions) |
| (1) | Any person who has sold buildings in units without making a statement of sale of buildings in units under Article 5 (1) or after making a statement of sale of buildings in units by deceit or other fraudulent means shall be punished by imprisonment for not more than three years, or by a fine not exceeding 300 million won. |
| (2) | 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 100 million won: <Amended on Nov. 1, 2012; Jun. 24, 2017> |
| 1. | A person who runs advertisements for sale of buildings in units without having been notified of acceptance of statement of sale of buildings in units, or invites persons to acquire buildings in units by a method other than public invitation, or publicly invites persons to acquire buildings in units not by means of the internet, even though the buildings are of such a purpose and scale that require invitation through the internet, in violation of Article 6 (1); |
| 2. | A person who selects persons to acquire buildings in units not by open lottery, in violation of Article 6 (3); |
| 3. | A person who concludes contracts of sale of buildings in units, in violation of Article 6 (4) or the latter part of paragraph (5) of the same Article; |
| 4. | Sellers of buildings in units who sell buildings in units or advertise sale of buildings in units in violation of Article 6-2 (1); |
| 5. | A person who resells buildings acquired in units or mediates the resale thereof, in violation of the provisions of Article 6-3 (1) through (3); |
| 6. | A person who modifies designs without obtaining consent of all relevant acquisitors of buildings in units or without notifying all such acquisitors, in violation of Article 7 (1) or (2). |
| (3) | Deleted. <on Feb. 24, 2017> |
[This Article Wholly Amended on Mar. 9, 2011]
| Article 11 (Joint Penalty Provisions) |
Where the representative of a corporation, or an agent, employee, or any other servant of a corporation or individual commits an offence provided for in Article 10 (1) or (2) in connection with the affairs of the corporation or the individual, not only shall such offender be punished, but also the corporation or the individual shall be punished by a fine under the relevant provisions: Provided, That this shall not apply where such corporation or individual has not been negligent in giving due attention and supervision concerning the relevant affairs to prevent such offence. [This Article Wholly Amended on Apr. 1, 2009]
| Article 12 (Administrative Fines) |
| (1) | Any person who falls under any of the following subparagraphs shall be punished by an administrative fine not exceeding 100 million won: |
| 1. | A person who receives the price of building sold in units, in violation of Article 8; |
| 2. | An enterpriser selling buildings in units who fails to announce or notify, in violation of Article 9 (2) or (3). |
| (2) | Any person who fails to submit or report data, submits or reports false data, or refuses, obstructs, evades an investigation or inspection prescribed in Article 9-3 (1), shall be punished by an administrative fine not exceeding five million won. <Newly Inserted on Oct. 24, 2017> |
| (3) | Administrative fines under paragraphs (1) and (2) shall be imposed and collected by the Minister of Land, Infrastructure and Transport or persons authorized to issue permits, as prescribed by Presidential Decree. <Amended on Mar. 24, 2017> |
[This Article Wholly Amended on Mar. 9, 2011]
ADDENDA <Act No. 7244, Oct. 22, 2004>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Applicability)
This Act shall apply beginning from the first buildings for which persons to acquire buildings in units are invited (including cases where persons to acquire buildings in units are invited not through open invitation) after this Act enters into force.
Article 3 Omitted.
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. 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. 8972, Mar. 21, 2008>
| (1) | (Enforcement Date) This Act shall enter into force six months after the date of its promulgation. |
| (2) | (General Transitional Measures) Where sellers of buildings in units have made a statement of sale of buildings in units to persons authorized to issue permits before this Act enters into force as prescribed in Article 5 (1), the former provisions shall apply thereto. |
ADDENDA <Act No. 8974, Mar. 21, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 14 Omitted.
ADDENDUM <Act No. 9060, Mar. 28, 2008>
This Act shall enter into force three months after the date of its promulgation.
ADDENDA <Act No. 9593, Apr. 1, 2009>
| (1) | (Enforcement Date)This Act shall enter into force on the date of its promulgation. (Proviso Omitted.) |
| (2) | (Transitional Measures) When penalty provisions are applied for any acts committed before this Act enters into force, the previous provisions shall apply. |
ADDENDUM <Act No. 9857, Dec. 29, 2009>
This Act shall enter into force on the date of promulgation.
ADDENDA <Act No. 10252, Apr. 12, 2010>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDUM <Act No. 10462, Mar. 9, 2011>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 10580, Apr. 12, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 5 Omitted.
ADDENDA <Act No. 10719, May. 24, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENUM <Act No. 11467, Jun. 1, 2012>
This Act shall enter into force on the date of promulgation.
ADDENDA <Act No. 11690, Mar. 23, 2013>
Article 1 (Enforcement Date)
This Act shall enter into on the date of its promulgation.
Articles 2 through 7 Omitted.
ADDENDA <Act No. 13805, Jan. 19, 2016>
Article 1 (Enforcement Date)
This Act shall enter into force on Aug. 12, 2016.
Articles 2 through 22 Omitted.
ADDENDA <Act No. 14791, Apr. 18, 2017>
Article 1 (Enforcement Date)
This Article shall enter into force six months after the date of its promulgation.
Article 2 (Applicability to Advertising Campaigns)
The amended provisions of Article 6 (2) shall begin to apply from the first advertising campaign after this Act enters into force.
ADDENDA <Act No. 14934, Oct. 24, 2017>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation: Provided, That the amended provisions of Article 10 (2) 4 and (3) of said Article shall enter into force on the date of its promulgation. Article 2 (Applicability to Methods of Sale of Buildings in Units)
The amended provisions in the latter part of Article 6 (1) shall apply beginning with the first case where persons to acquire buildings in units are publicly invited after this Act enters into force. Article 3 (Applicability to Priority Sale of Buildings in Units to Residents)
The amended provisions in the latter part of Article 6-2 (1) shall apply beginning with the first case where sellers of buildings in units make a statement on sale of buildings in units under Article 5 after this Act enters into force. Article 4 (Restrictions on Resale of Buildings Sold in Units)
The amended provisions in Article 6-3 (1) shall apply beginning with the first case where sellers of buildings in units make a statement on sale of buildings in units under Article 5 after this Act enters into force.
ADDENDA <Act No. 16415, Apr. 30, 2019>
Article 1 (Enforcement Date)
| (1) | This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.) |
Articles 2 and 3 Omitted.
ADDENDA <Act No. 16484, Aug. 20, 2019>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Applicability to Methods of Sale of Buildings in Units, etc.)
The amended provisions of Article 6 (4) shall begin to apply from the first case where sellers of buildings in units make a statement on sale of buildings in units under Article 5 after this Act enters into force.