ACT ON SUPPORT FOR GAESEONG INDUSTRIAL COMPLEX
Act No. 8484, May 25, 2007
Amended by Act No. 9319, Dec. 31, 2008
Act No. 9357, Jan. 30, 2009
Act No. 9433, Feb. 6, 2009
Act No. 9685, May 21, 2009
Act No. 10189, Mar. 26, 2010
Act No. 10339, jun. 4, 2010
Act No. 10893, Jul. 21, 2011
Act No. 11020, Aug. 4, 2011
Act No. 11141, Dec. 31, 2011
Act No. 12038, Aug. 13, 2013
Act No. 12277, Jan. 21, 2014
Act No. 16172, Dec. 31, 2018
CHAPTER I GENERAL PROVISIONS
The purpose of this Act is to enhance inter-Korean exchanges and cooperation and further to contribute to the balanced development of the economy of the Korean nation by providing matters necessary for supporting the development and operation of the Gaeseong Industrial Complex and protecting and supporting South Korean residents (including corporations; hereinafter the same shall apply) who invests in, enter, exit, or stay in the Gaeseong Industrial Complex.
The terms used in this Act are defined as follows: <Amended on Jan. 30, 2009; Mar. 26, 2010>
| 1. | The term “Gaeseong Industrial Complex” or “GIC” means the industrial zone developed and established in the area of Gaeseong located in North Korea by agreement between South and North Korea; |
| 2. | The term “GIC developer” means a South Korean resident designated as a developer pursuant to the Gaeseong Industrial Complex Act of North Korea, with approval for a cooperative project under the Inter-Korean Exchange and Cooperation Act; |
| 3. | The term “GIC management organ” means a corporation established under the Gaeseong Industrial Complex Act of North Korea for purposes of managing and operating the GIC; |
| 4. | The term “local enterprise of the GIC” means an enterprise (including its branch offices, business offices, and offices) established by a South Korean resident in the GIC with approval for a cooperative project or after acceptance of a report on such cooperative project under the Inter-Korean Exchange and Cooperation Act; |
| 4-2. | The term “enterprise invested in the GIC” means a small and medium enterprise prescribed by Presidential Decree from among parent companies of South Korea where a South Korean resident invests in the GIC with approval for a cooperative project or after acceptance of a report on such cooperative project under the Inter-Korean Exchange and Cooperation Act; |
| 5. | The term “entry and exit” or “stay” shall have the same meaning as in the Agreement on Entry into, Exit from and Stay in the GIC and the Geumgangsan Tourist Zone; |
| Article 3 (Government Policy) |
| (1) | The Government shall formulate and implement policies for fostering and developing the GIC into an international industrial zone and shall devise support measures necessary therefor. |
| (2) | The Government shall create conditions necessary to ensure that the development of the GIC and the business operations of the enterprises in the GIC can be conducted in a consistent manner on the basis of the economic principles and the autonomy of such enterprises and shall also endeavor to support such development and business operations. |
| (3) | In developing the GIC, the Government shall formulate and implement policies for enhancing the welfare and industrial safety of South and North Korean residents and shall also provide support so that it can be established as an environment-friendly industrial zone. |
| (4) | The Government shall endeavor to ensure that inter-Korean economic exchanges and cooperation in the GIC can be established and grow in conformity with the principles and practices of inter-Korean domestic transactions and that such inter-Korean economic exchanges and cooperation can be recognized by the international community. |
| (5) | Where it is deemed necessary for the development of the GIC, the Minister of Unification may request necessary support from the heads of relevant central administrative agencies, local governments, and other relevant agencies and organizations. |
| Article 4 Deleted. <Mar. 26, 2010> |
| Article 5 (Relationship to Other Statutes) |
This Act shall prevail over other statutes with respect to supporting, traveling to and from, and trading at the GIC.
CHAPTER II SUPPORT FOR DEVELOPMENT AND INVESTMENT
| Article 6 (Support for Development of GIC) |
| (1) | The Government may take measures necessary for granting financial support to facilitate the establishment and operation of the GIC. |
| (2) | The Government or the providers of relevant facilities pursuant to Article 29 (1) of the Industrial Sites and Development Act shall have priority over other providers in providing supports for infrastructure such as roads, water supply, railways, telecommunications, and electricity necessary for facilitating the establishment of the GIC: Provided, That regarding infrastructure provided by the Government, the Government may entrust GIC developers with its establishment. |
| (4) | The Minister of Unification may require a person engaging in a project other than the industrial complex development projects provided in subparagraph 9 of Article 2 of the Industrial Sites and Development Act to pay, as facility charges, the expenses that have been paid by the Government for the construction of the infrastructure referred to in paragraph (2). <Amended on Aug. 4, 2011> |
| (5) | The Minister of Unification shall determine important matters regarding the content of the development projects, the size and methods of support, etc. provided in paragraphs (1) through (3), subject to deliberation and resolution by the Inter-Korean Exchange and Cooperation Promotion Council (hereinafter referred to as the “IKECPC”), as prescribed in Article 4 of the Inter-Korean Exchange and Cooperation Act. |
| (6) | Matters necessary for the provision of support, payment of facility charges, and deliberation and resolution by the IKECPC pursuant to paragraphs (1) through (5) shall be prescribed by Presidential Decree. |
| Article 7 (Support for Fund for Establishment and Promotion of Small and Medium Enterprises and Startups) |
| (2) | Matters necessary for the use of the Fund under paragraph (1) shall be prescribed by Presidential Decree. <Amended on Jan. 21, 2014> |
[Title Amended on Jan. 21, 2014; Dec. 31, 2018]
| Article 8 (Support for Industrial Safety and Health and Prevention of Industrial Accidents) |
| (2) | In providing support under paragraph (1), part of the authority and duties of the Korea Occupational Safety and Health Agency may be entrusted to the GIC management organ. <Amended on Dec. 31, 2008> |
| Article 9 (Support for Environmental Conservation) |
| (2) | For purposes of providing support under paragraph (1), the Government may have the Korea Environmental Corporation or other organizations perform programs provided in Article 17 (1) of the Korea Environmental Corporation Act. <Amended on Feb. 6, 2009> |
| Article 10 (Support for Energy Use Rationalization) |
| (2) | Matters necessary for the provision of support under paragraph (1) shall be prescribed by Presidential Decree. |
| Article 11 (Support or Lending of Inter-Korean Cooperation Fund) |
| Article 11-2 (Special Cases concerning Foreign-Invested Companies) |
| (1) | Where a foreign-invested company (referring to a foreign-invested company or foreigner-contributed non-profit corporation defined in subparagraph 6 of Article 2 of the Foreign Investment Promotion Act; hereafter in this Article the same shall apply) establishes a local enterprise of the GIC, the Government may furnish the foreign-invested company with the Inter-Korean Cooperation Fund under Article 8 of the Inter-Korean Cooperation Fund Act and provide the local enterprise of the GIC of the foreign-invested company with administrative and financial support under Articles 7 through 11. |
| (2) | The foreign investment support center for the GIC (hereinafter in this Article referred to as the "Center") shall be established within the Gaeseong Industrial District Foundation provided in Article 19 to comprehensively support foreign-invested companies that have established local enterprises of the GIC pursuant to paragraph (1). |
| (3) | Article 15 of the Foreign Investment Promotion Act shall apply mutatis mutandis to the organization and operation of the Center. In such cases, the "Korea Trade-Investment Promotion Agency" shall be deemed the "Gaeseong Industrial District Foundation" and the "Foreign Investment Support Center" shall be deemed the "foreign investment support center for the GIC". |
| (4) | Support for foreign-invested companies under paragraph (1) shall not be affected by support for foreign-invested companies under the Foreign Investment Promotion Act. |
| (5) | Other matters necessary for supporting foreign-invested companies in order to facilitate their investment in the GIC shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Jan. 21, 2014]
| Article 12 (Application of Other Governmental Support Systems) |
In addition to the business support under this Act, other business support systems designed for developing human resources and technologies and promoting education and training, management innovation and stabilization, export, and the like under other statutes may apply to the GIC, as prescribed by Presidential Decree.
| Article 12-2 (Support for Management Normalization of Enterprises Invested in GIC) |
| (1) | If an entry into or exit from the GIC is blocked or business in the GIC is suspended for a considerable period by any actions of South and North Korean authorities, the Government may, for purposes of assisting enterprises invested in the GIC in their management normalization, take necessary actions including supports provided in Articles 12-3 and 12-4, as prescribed by Presidential Decree. |
| (2) | When it is deemed necessary in cases falling under paragraph (1), the Minister of Unification may request support necessary for the management normalization of enterprises invested in the GIC from the heads of the relevant administrative agencies. |
[This Article Newly Inserted on Mar. 26, 2010]
| Article 12-3 (Financial Support for Enterprises Invested in GIC) |
[This Article Newly Inserted on Mar. 26, 2010]
| Article 12-4 (Financial Support for Relocation of Enterprises Invested in GIC or Installation of Substitute Production Facilities) |
[This Article Wholly Amended on Jan. 21, 2014]
| Article 12-5 (Hearing of Opinions of Enterprises Invested in GIC) |
When taking necessary measures including support under Articles 12-3 and 12-4 due to the occurrence of an event provided in Article 12-2 (1), the Government shall hear the opinions of the enterprises invested in the GIC and reflect such opinions when it deems the opinions reasonable. [This Article Newly Inserted on Aug. 13, 2013]
| Article 12-6 (Fact-Finding Surveys on Enterprises Invested in GIC) |
| (1) | The Government may conduct a fact-finding survey on an enterprise invested in the GIC upon the occurrence of an event provided in Article 12-2 (1). The Government shall, where it conducts a fact-finding survey, report the results thereof to the National Assembly without delay. |
| (2) | Where it is deemed necessary for a fact-finding survey referred to in paragraph (1), the Minister of Unification may request the heads of relevant central administrative agencies, the heads of local governments, the heads of public institutions, enterprises invested in the GIC, relevant organizations and others to furnish necessary materials. In such cases, upon receiving such request, the heads of relevant central administrative agencies, etc. shall comply therewith unless there is a compelling reason not to do so. |
| (3) | The scope of, and methods and procedures for fact-finding surveys under paragraph (1) and other necessary matters shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Aug. 13, 2013]
CHAPTER III PROTECTION OF PERSONS ENTERING, EXITING, AND STAYING IN GIC
| Article 13 (Application of Statutes Regarding Social Insurance) |
| (1) | The following statutes shall apply to local enterprises of the GIC and South Korean residents employed by them (excluding corporations; hereinafter referred to as “workers from South Korea”): |
| (2) | Local enterprises of the GIC and workers from South Korea shall be respectively deemed employers (business proprietors) and workers under the statutes provided in the subparagraphs of paragraph (1). |
| (3) | For purposes of applying the statutes provided in the subparagraphs of paragraph (1), workers from South Korea working or staying in the GIC shall be deemed to be working or staying in South Korea. |
| (4) | For purposes of applying the statutes provided in the subparagraphs of paragraph (1), part of the authority or duties of the Minister of Employment and Labor, National Pension Service, National Health Insurance Corporation, Korea Labor Welfare Corporation, etc. may be entrusted to the GIC management organ, as prescribed by Presidential Decree. <Amended on June 4, 2010> |
| (5) | Other matters necessary for applying the statutes provided in the subparagraphs of paragraph (1) shall be prescribed by Presidential Decree. |
| Article 14 (Medical Institutions) |
| (2) | When a South Korean resident entering, exiting, or staying in the GIC receives any medical service from a medical facility referred to in paragraph (1), he or she shall be provided health care benefits as prescribed in Article 41 of the National Health Insurance Act. <Amended on Dec. 31, 2011> |
| (4) | Matters necessary for approving cooperative projects, recognizing medical institutions and health care institutions, and providing health and medical care benefits under paragraphs (1) through (3) shall be prescribed by Presidential Decree. |
| Article 15 (Application of Statutes Regarding Working Conditions) |
| (1) | The following statutes shall apply to local enterprises of the GIC and workers from South Korea: |
| (2) | For purposes of applying the statutes provided in the subparagraphs of paragraph (1), part of the authority or duties of the Minister of Employment and Labor and labor inspectors may be entrusted to the GIC management organ, as prescribed by Presidential Decree. <Amended on Jun. 4, 2010> |
| (3) | Other matters necessary for applying the statutes provided in paragraph (1) shall be prescribed by Presidential Decree. |
| Article 15-2 (Safety Training for Executive Officers and Employees of Local Enterprises of GIC) |
| (1) | The Minister of Unification shall conduct education to ensure that full-time executive officers and employees of local enterprises of the GIC (limited to South Korean residents) can enter, exit and stay in the GIC safely. |
| (2) | Matters necessary for the content, period, methods, etc. of education under paragraph (1) shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Mar. 26, 2010]
| Article 15-3 (Notice of Personal Safety Information) |
| (1) | Upon becoming aware of the information that may have a direct and serious effect on the safety of South Korean residents staying in the GIC, the Minister of Unification shall promptly notify local enterprises of the GIC and workers from South Korea of such information. |
| (2) | The Minister of Unification shall make necessary efforts, including the formulation of systems to ensure the safety of South Korean residents in the GIC. |
| (3) | Matters necessary for the methods and procedures for notice under paragraph (1) shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Mar. 26, 2010]
CHAPTER IV SPECIAL CASES CONCERNING TAXATION, TRAVEL, AND TRADE
| Article 16 (Reduction of and Exemption from Taxes) |
Where deemed necessary to encourage investment in the GIC, the Government may grant South Korean residents investing in the GIC a reduction of or exemption from taxes as prescribed by the Restriction of Special Taxation Act.
| Article 17 (Special Cases concerning Travel and Trade) |
| (1) | Section 3 of Chapter VI and Sections 1 and 2 of Chapter IX of the Customs Act shall apply mutatis mutandis to goods traded at the GIC and vehicles entering and exiting the GIC: Provided, That special cases to simplify the procedures for such travel and trade may be established based on the principle of intra-national transaction. |
| (2) | For purposes of applying Article 9 of the Inter-Korean Exchange and Cooperation Act to a person who has obtained a certificate of multiple visits as prescribed in Article 9 (2) of that Act for traveling to and from the GIC, special cases concerning exemption from visit approval procedures may be established. <Amended on Jan. 30, 2009> |
| (4) | The scope of and criteria for applying special cases for simplifying the regulations, etc. referred to in paragraphs (1) through (3) shall be prescribed by Presidential Decree. |
| (5) | Details for implementing special cases concerning simplification under paragraph (1) or (3) shall be determined by the Minister of Justice or the Commissioner of the Korea Customs Service, subject to deliberation and resolution by the IKECPC. |
CHAPTER V GIC MANAGEMENT ORGAN
| Article 18 (GIC Management Organ) |
| (1) | The GIC management organ shall have a legal capacity of a corporation to the extent necessary for the management and operation of the GIC. |
| (2) | The Government may provide the GIC management organ with funds, personnel, materials, etc. where deemed necessary for the operation and management of the GIC. |
| (3) | The GIC management organ may establish and maintain an office in South Korea. |
| Article 18-2 (Establishment of Organization in Charge of GIC Business) |
| (1) | In order to support the development of the GIC and stable business operations of local enterprises of the GIC, an organization in charge of GIC business shall be established within the Ministry of Unification. |
| (2) | Matters necessary for establishing and operating the organization in charge of GIC business under paragraph (1) shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Mar. 26, 2010]
| Article 19 (Gaeseong Industrial District Foundation) |
| (1) | The Government shall establish the Gaeseong Industrial District Foundation (hereinafter referred to as the “Foundation”) in order to support the development and operation of the GIC. |
| (2) | The Foundation shall be a corporation and shall be established at the time it registers such establishment at the location of its main office. |
| (3) | The Foundation shall perform the following tasks: |
| 1. | Establishing and implementing support measures for the development of the GIC; |
| 2. | Providing support, operational guidance, and supervision to the GIC management organ; |
| 3. | Establishing and implementing support measures for local enterprises of the GIC; |
| 4. | Issuing various certificates and performing affairs related to civil petitions on behalf of the GIC management organ; |
| 5. | Conducting affairs designated by the Minister of Unification. |
| (4) | The operation of the Foundation shall be financed by the following resources: Notwithstanding the provisions of the State Property Act, the Government may gratuitously transfer or lease State properties as provided by Presidential Decree if necessary to perform the tasks provided in the subparagraphs of paragraph (3): |
| 1. | Contributions and subsidies from the Government; |
| 3. | Profits generated from for-profit business; |
| (5) | When the Foundation is dissolved, remaining assets shall revert to the State as prescribed by its articles of association. |
| (6) | Except as provided in this Act, the provisions of the Civil Act concerning incorporated foundations shall apply mutatis mutandis to the Foundation. |
| (7) | Other matters necessary for the establishment, organization, and operation of the Foundation shall be prescribed by Presidential Decree. |
| Article 20 (Dispatch of Public Officials) |
| (1) | If deemed necessary to support the development, management, and operation of the GIC and to promote the inter-Korean economic cooperation, the Government may dispatch public officials or non-public officials to North Korea for a specified period to serve in the GIC management organ or the like. |
| (2) | The Government may provide necessary expenses incurred under paragraph (1). |
| (3) | The dispatch of public officials under paragraph (1) shall be in conformity with the Development of Inter-Korean Relations Act, and matters necessary for the dispatch of non-public officials shall be prescribed by Presidential Decree. |
ADDENDA <Act No. 8484, May 25, 2007>
| (1) | (Enforcement Date) This Act shall enter into force three months after the date of its promulgation. |
| (2) | (Liquidation of the GIC Support Association) The GIC Support Association, established as an incorporated foundation prior to the enforcement date of this Act, shall be liquidated upon enforcement of this Act and the rights and obligations of the liquidated entity shall be comprehensively succeeded by the Gaeseong Industrial District Foundation under Article 19. |
ADDENDA <Act No. 9319, Dec. 31, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDA <Act No. 9357, Jan. 30, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDA <Act No. 9433, Feb. 6, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2010.
Articles 2 through 11 Omitted.
ADDENDA <Act No. 9685, May 21, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 8 Omitted.
ADDENDUM <Act No. 10189, Mar. 26, 2010>
This Act shall enter into force six months after the date of its promulgation.
ADDENDA <Act No. 10339, Jun. 4, 2010>
Article 1 (Enforcement Date)
This Act shall enter into force one month after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 5 Omitted.
ADDENDA <Act No. 10893, Jul. 21, 2011>
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. 11020, Aug. 4, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 11 Omitted.
ADDENDA <Act No. 11141, Dec. 31, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force on September 1, 2012. (Proviso Omitted.)
Articles 2 through 22 Omitted.
ADDENDUM <Act No. 12038, Aug. 13, 2013>
This Act shall enter into force three months after the date of its promulgation.
ADDENDA <Act No. 12277, Jan. 21, 2014>
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 Foreign-Invested Companies)
The amended provisions of Article 11-2 shall also apply to foreign-invested companies that have established local enterprises of the GIC before this Act enters into force. Article 3 (Applicability to Financial Support for Relocation of Enterprises Invested in GIC or Installation of Substitute Production Facilities)
The amended provisions of Article 12-4 shall apply to the relocation of production facilities to South Korea or the installation of substitute production facilities after this Act enters into force.
ADDENDA <Act No. 16172, Dec. 31, 2018>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 5 Omitted.