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
Presidential Decree No. 32449, Feb. 17, 2022
CHAPTER I GENERAL PROVISIONS
The purpose of this Decree is to prescribe matters mandated by the State Credit Management Act and matters necessary for the enforcement thereof. [This Article Wholly Amended on Feb. 11, 2014]
| Article 2 (Claims governed by provisions regarding reporting) |
[This Article Wholly Amended on Feb. 11, 2014]
[Moved from Article 3; previous Article 2 moved to Article 3 <Feb. 11, 2014>]
| Article 3 (Claims equivalent to fines) |
"Claims prescribed by Presidential Decree" in Article 3 (1) 1 of the Act means: [This Article Wholly Amended on Feb. 11, 2014]
[Moved from Article 2; previous Article 3 moved to Article 2 <Feb. 11, 2014>]
| Article 3-2 (Scope of savings and deposits) |
Claims related to deposits and entrusted funds of the State under Article 3 (1) 3 of the Act means Claims related to deposits and entrusted funds of the State (including national funds received by 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 on Feb. 11, 2014]
| Article 4 (Claims to which this Act does not apply) |
"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 on Feb. 11, 2014]
| Article 5 (Scope of claims to which this Act does not apply) |
| (1) | Articles 14-2, 14-3, 15, 18 through 22, 27 through 29, and 33 of the Act shall not apply to claims where a foreign country or an international organization is the debtor under Article 3 (2) 1 of the Act; provided, Articles 13 and 14 of the Act shall also not apply to claims, among those where a foreign country or an international organization is the debtor, as determined by the Minister of Economy and Finance. |
[This Article Wholly Amended on Feb. 11, 2014]
CHAPTER II CLAIMS MANAGEMENT AUTHORITY
| Article 6 (Delegation of management) |
| (1) | When the head of a central government agency intends to delegate, have performed on their behalf, or have shared claims management affairs with a public official affiliated with another central government agency, the head of a local government, or a public official affiliated therewith under Article 6 of the Act, they shall obtain consent from the head of the relevant central government agency or the head of the relevant local government regarding the following matters: |
| 1. | A public official to whom claims management affairs are to be delegated, or a public official who will perform such business affairs on their behalf or share such business affairs with them; |
| 2. | Scope of business affairs to be delegated, performed on behalf of, or shared. |
| (2) | When the head of a central government agency delegates their claims management affairs 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 on their behalf for the purpose of managing claims or to take partial charge thereof, under Article 6 of the Act, they shall notify the Board of Audit and Inspection of the following matters: |
| 1. | A public official to whom claims management affairs are to be delegated, or a public official who will perform such business affairs on their behalf or share such business affairs with them; |
| 2. | Scope of business affairs to be delegated, performed on behalf of, or shared. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 7 Deleted. <Sep. 6, 1983> |
| Article 8 (Handing over claims management affairs) |
| (1) | When the head of a central government agency intends to require a claims management officer to hand over their claims management affairs to another claims management officer under Article 9 (1) of the Act, they shall set the date on which such business affairs shall begin. |
| (2) | The claims management officer who shall hand over the claims management affairs shall deliver the following documents or articles to the claims management officer who shall take charge of the claims management affairs by the date on which such business affairs shall begin in accordance with paragraph (1): |
| 1. | Claims management books; |
| 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 claims management affairs to the head of another central government agency under Article 9 (2) of the Act. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 9 (Cases where claims management officer may concurrently serve in a cash handling position) |
In any of the following circumstances, a claims management officer may concurrently serve in a cash handling position under the proviso of Article 10 of the Act: | 1. | Where they work for a diplomatic mission abroad; |
| 2. | Where they work for a government office where they are compelled to concurrently perform the relevant duties due to shortage of personnel. |
[This Article Wholly Amended on Feb. 11, 2014]
CHAPTER III STANDING RULES FOR CLAIMS MANAGEMENT
| Article 10 (Notice of accrual or vesting of claims) |
| (1) | A notification under Article 11-2 of the Act shall be made in writing stating the following matters; provided, if the person giving the notification concurrently serves as the claims management officer, such notification may be omitted: |
| 1. | The debtor's name and address (or the name and location of the corporation, if the debtor is a corporation); |
| 4. | Why the claim has accrued; |
| 5. | When the claim has accrued; |
| 7. | Matters concerning interest and interest rates; |
| 8. | Matters concerning overdue charges; |
| 9. | Matters concerning the debtor’s property, business, and other sources of income; |
| 10. | Matters concerning collateral; |
| 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 on 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 Decree of the Ministry of Economy and Finance; provided, the claims management books may be substituted by the books determined by the head of a central government agency, if they find it more efficient to manage specific claims that ordinarily accrue in the central government office with different books. [This Article Wholly Amended on Feb. 11, 2014]
| Article 12 (Claims not required to be recorded in books) |
Claims not required to be recorded in books under the proviso of Article 12 of the Act shall be as follows: <Amended on Sep. 18, 2018; Jun. 9, 2020> | 1. | Claims to fall under the jurisdiction of a claims management officer and found totally extinguished according to the results 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 on 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 clause of Article 13 (1) of the Act or intends to give a payment notice by themselves under the proviso of that paragraph, they shall investigate the amount of the relevant claim, the payment deadline, and whether any other content of the claim breaches relevant statutes or regulations, or contracts. |
| (2) | When a claims management officer intends to request a payment notice under paragraph (1), they shall do so no later than 20 days before the payment deadline of the claim; and if they intend to issue a payment notice themselves, they shall do so no later than 15 days before the payment deadline; provided, where it is unavoidable for the purpose of securing the claim, they shall request or issue the payment notice without delay after investigating and verifying the claim. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 14 (Claims not requiring payment notices) |
"Claims prescribed by Presidential Decree" in Article 13 (3) of the Act mean: | 1. | Claims specified in subparagraph 1 of Article 12; |
| 2. | Repayment of remuneration recovered by deduction from remuneration paid by the State. |
[This Article Wholly Amended on 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 overdue debt collection duties to a person under 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 deems it impracticable to recover the claim due to the absence of income or property in the name of the delinquent debtor, or other similar reasons. |
[This Article Added on Feb. 11, 2014]
| Article 14-3 (Method for entrustment of overdue debt collection duties) |
| (1) | When the head of a central government agency intends to entrust a person with the duties under Article 14-2 (1) of the Act (hereinafter referred to as "overdue debt collection duties") under 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, they shall enter into an agreement on entrustment with the person entrusted with the overdue debt collection duties under that 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), they shall send an entrustment request to the entrusted agency, specifying the following matters with regard to the overdue debts of the 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 type of the claim; |
| 3. | The amount of the claim; |
| (3) | When the head of a central government agency enters into an agreement on the entrustment of overdue debt collection duties under paragraph (1), they shall notify the delinquent debtor of the entrustment without delay and shall notify the Minister of Economy and Finance of the details of the entrustment. |
[This Article Added on Feb. 11, 2014]
| Article 14-4 (Restrictions on scope of persons who can be entrusted with overdue debt collection duties) |
The Minister of Economy and Finance shall first entrust the overdue debt collection duties to the Korea Asset Management Corporation under the Act on the Establishment of Korea Asset Management Corporation under Article 14-2 of the Act, and then may entrust the overdue debt collection duties to a debt collection company under subparagraph 10-2 of Article 2 of the Act on the Use and Protection of Credit Information, taking into consideration whether the Korea Asset Management Corporation has appropriately performed the entrusted duties. <Amended on Aug. 4, 2020; Feb. 17, 2022> [This Article Added on Feb. 11, 2014]
| Article 14-5 (Entrustment fees for overdue debt collection duties) |
The entrustment fee under Article 14-2 (4) of the Act shall be an amount calculated by applying a ratio prescribed by the Decree of the Ministry of Economy and Finance within the limit of 25/100 to the following amount out of the overdue debts for which the entrusted agency has been entrusted to perform the overdue debt collection duties: | 1. | The amount paid by a delinquent debtor if they fully or partially pays their 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 Added on Feb. 11, 2014]
| Article 14-6 (Termination of entrustment of overdue debt collection duties) |
In any of the following circumstances, the head of a central government agency shall terminate the entrustment of overdue debt collection duties:
| 1. | Where the obligation to pay has been extinguished due to repayment of the claim or the completion of the extinctive prescription; |
| 2. | Where the collateral provided by the delinquent debtor under Article 18 of the Act is sufficient to cover the overdue debts; |
| 3. | Where a deferment agreement is entered into under Article 27 (2) of the Act with regard to a claim, the payment deadline of which has expired; |
| 4. | Where a debt is released under Article 31 (1) of the Act. |
[This Article Added on 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, they shall inform the entrusted agency of the date, time, purposes, scope, etc. of the audit no later than 7 days before commencing the audit; provided, this shall not apply in cases where it is deemed urgent or where prior notification would make it impossible to achieve the purpose of the audit due to destruction of evidence or other reasons. [This Article Added on Feb. 11, 2014]
| Article 15 (Claim of guarantor’s performance) |
When the head of a central government agency makes a demand to a guarantor for the performance of obligations under Article 15 (1) 1 of the Act with respect to a claim under their jurisdiction, they shall have the claims management officer of the agency issue a payment notice in accordance with Article 13. [This Article Wholly Amended on Feb. 11, 2014]
| Article 16 (Requests for proceedings for disposition on delinquency) |
If a claim collectible in the same manner as delinquent national taxes are collected under relevant statutes or regulations 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 delinquency under relevant statutes or regulations to commence the proceedings for the disposition on delinquency.
[This Article Wholly Amended on Feb. 11, 2014]
| Article 16-2 (Collection prior to payment deadline) |
| (1) | The grounds for accelerating the performance deadline under the main clause of Article 16 of the Act shall be grounds that allow for the acceleration of the performance deadline in accordance with relevant statutes or regulations or terms and conditions of the relevant contract. |
| (2) | When the claim management officer intends to exercise a claim before the payment deadline under paragraph (1), they shall notify the revenue collection officer of the following matters; provided, for a claim for which the claim management officer issues the payment notice themselves, they shall directly notify the debtor. |
| 1. | Grounds for changing the payment deadline; |
| 2. | The original payment deadline; |
| 3. | The changed payment deadline. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 17 (Types of collateral and methods of valuation) |
| (1) | The types of collateral that may be provided by a debtor to preserve claims under Article 18 (1) of the Act shall be as follows; provided, if otherwise provided by statutes, regulations, or contracts, such provisions shall apply: |
| 2. | Securities designated by the Minister of Economy and Finance; |
| 4. | Any asset covered by insurance that is a registered or recorded building, factory foundation, mining foundation, ship, aircraft, or construction machine; in such cases, the expiration date of the insurance period shall be at least 30 days later than the end of the period during which the security is required; |
| 5. | A payment guarantee issued by a financial institution or guarantor deemed reliable by the competent claims management officer. |
| (2) | The valuation of collateral under paragraph (1) shall be conducted according to the following classifications: |
| 1. | Listed securities: The final transaction price formed on an exchange licensed under Article 373-2 of the Financial Investment Services and Capital Markets Act as of the date the securities are provided as collateral (hereafter in this subparagraph referred to as the “exchange”); provided, where the securities have not been traded on the exchange, their value shall be determined based on the last purchase cost method; |
| 2. | Land, buildings, factory foundations, mining foundations, ships, aircraft, or construction machines: The assessed value under the Local Tax Act or the value appraised by an appraisal agency or the appraised value determined by an appraisal agency or a person with expertise in the appraisal of such property. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 17-2 (Method for providing collateral) |
| (1) | The methods for providing collateral under Article 18 (1) of the Act shall be as follows: |
| 1. | A person who intends to provide cash, securities, or a payment guarantee as collateral shall deliver the collateral to the claims management officer; provided, in case of registered securities, the person shall file for registration of their intention to provide the securities as collateral 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 collateral shall deliver the relevant certificate of registered information, 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 collateral and return the remainder, if any, to the debtor. |
| (3) | Upon receipt of collateral, a claims management officer shall enter relevant details in the book determined by the Minister of Economy and Finance and shall take custody of the collateral. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 18 (Procedures for suspension of management) |
| (1) | When the claims management officer intends to suspend the processing of business affairs regarding the preservation or collection of a claim (hereinafter referred to as “suspension of management”) under Article 24 (1) of the Act, they shall, as prescribed by the Decree of the Ministry of Economy and Finance, investigate and verify the whereabouts of the debtor and the existence of their property through local administrative agencies and tax offices; provided, this shall not apply where the amount of the claim is less than 100,000 won. |
| (2) | When a claims management officer intends to suspend management under Article 24 (1) of the Act, they shall present the documents containing the following matters to the head of the central government agency, to which they belong, for approval thereof: |
| 1. | Grounds for the suspension of management; |
| 2. | The debtor’s whereabouts; |
| 3. | The current status of the debtor’s property; |
| 4. | Other matters necessary for the suspension of management. |
[This Article Wholly Amended on Feb. 11, 2014]
[Moved from Article 19; previous Article 18 moved to Article 19 <Feb. 11, 2014>]
| Article 19 (Circumstances in which management may be suspended) |
"Circumstances prescribed by Presidential Decree" in Article 24 (1) 2 of the Act means: | 1. | Where the whereabouts of the debtor are unknown and the value of seizable property exceeds the cost of compulsory execution, but the excess amount is less than the amount of preferential claims; |
| 2. | Where, after the claim management officer has made a demand for performance of the claim or taken preservation measures, there is no reasonable prospect that the debtor will have a domicile or residence in Korea, and the value of seizable property does not exceed the combined amount of the cost of compulsory execution and preferential claims. |
[This Article Wholly Amended on Feb. 11, 2014]
[Moved from Article 18; previous Article 19 moved to Article 18 <Feb. 11, 2014>]
| Article 19-2 (Order of priority in collection of claims) |
The order of priority in the collection of claims shall be as follows; provided, if otherwise provided in any other statute or a relevant contract, such statue or contract shall apply:
| 1. | Expenses incurred in the disposition on delinquency; |
| 2. | Claims arising from overdue charges; |
[This Article Wholly Amended on 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 classified as follows; provided, 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 they receive 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 property, other than cash (including securities paid in lieu of cash under the Revenue Payment by Securities Act) in accordance with relevant statutes or regulations: When the person receives payment in accordance with relevant statutes or regulations; |
| 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 on Feb. 11, 2014]
| Article 21 (Provision of data on delinquency or suspension of management) |
| (1) | "Circumstances prescribed by Presidential Decree" in the proviso of Article 25-2 (1) of the Act means circumstances in which any of the following events occurs to a delinquent debtor or a debtor. In such cases, 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 determined by the Minister of Economy and Finance: |
| 1. | Where a delinquent debtor or a debtor sustains severe damage to their property due to a disaster or theft; |
| 2. | Where a delinquent debtor or a debtor sustains a substantial loss on their business; |
| 3. | Where the business of a delinquent debtor or a debtor is in a serious crisis; |
| 4. | Where it is deemed that the recovery of the overdue debts is possible because the business can be operated normally due to the non-provision of data on delinquency or suspension of management under the main clause of Article 25-2 (1) of the Act (hereinafter referred to as “data on delinquency or suspension of management”). |
| (2) | "Amount prescribed by Presidential Decree" in Article 25-2 (1) 1 through 3 of the Act means 5 million won, respectively. |
[This Article Added on Feb. 11, 2014]
| Article 21-2 (Preparation of delinquency or management suspension data files) |
| (1) | If the head of a competent central government agency processes data on delinquency or suspension of management by using an electronic information processing system, they may create delinquency or management suspension data files (referring to data on delinquency or suspension of management recorded or stored in magnetic tapes, magnetic disks, or any other similar media; hereinafter the same shall apply). |
| (2) | The arrangement, management and storage of delinquency or management suspension data files under paragraph (1) and other necessary matters shall be determined by the head of a central government agency. |
[This Article Added on Feb. 11, 2014]
| Article 21-3 (Requests for data on delinquency or suspension of management) |
| (1) | A person who intends to request data on delinquency or suspension of management under the main clause 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 on delinquency or suspension of management under paragraph (1), the head of a central government agency may provide delinquency or management suspension data files or documents under Article 21-2 (1). |
| (3) | If the data on delinquency or suspension of management provided under paragraph (2) cease to constitute data on delinquency or suspension of management because of the payment of overdue debts or the revocation of suspension 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 on delinquency or suspension of management and other matters shall be prescribed by Decree of the Ministry of Economy and Finance. |
[This Article Added on Feb. 11, 2014]
CHAPTER IV MODIFICATION OF CONTENT OF CLAIMS AND RELEASE OF CLAIMS
| Article 22 (Claims ineligible for deferment agreement) |
"Claims prescribed by Presidential Decree" in Article 27 (1) of the Act means the following claims: <Amended on Sep. 18, 2018; Jun. 9, 2020> | 1. | Profits, surplus funds, or revenues to be paid to the State under relevant statutes or regulations; |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 23 (Procedures for deferment agreement) |
| (1) | If a debtor intends to obtain an extension of the payment deadline under a special contract or by a disposition under Article 27 (1) of the Act (hereinafter referred to as "deferment agreement"), they shall file an application for a deferment agreement (including an electronic application form), specifying the following matters, with the competent claims management officer; in such cases, 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 administrative data matching under Article 36 (1) of the Electronic Government Act or shall require the applicant to submit the certified transcript of their 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; |
| 5. | The original and extended payment deadline; |
| 6. | Matters concerning collateral for the claim; |
| 7. | Grounds for extension of the performance period; |
| 8. | Matters concerning collateral and interest on the extension of the payment deadline; |
| 9. | A statement to the effect that the debtor agrees to conditions attached under Article 30. |
| (2) | Upon receipt of an application from a debtor for a deferment agreement under paragraph (1), a claims management officer shall have local administrative agencies and tax offices investigate and verify whether the debtor owns property, as prescribed by Decree of the Ministry of Economy and Finance; provided, this shall not apply where the amount of claim is less than 100,000 won. |
| (3) | Where a claims management officer, based on the results of the investigation and verification under paragraph (2), finds that the requirements under the subparagraphs of Article 27 (1) of the Act are satisfied and intends to enter into a deferment agreement, they shall submit a statement of the grounds therefor, a report on the debtor’s property, a copy of the relevant application, and other necessary documents to the head of the central government agency to which they belong, for approval. |
| (4) | When a claims management officer intends to enter into a deferment agreement with approval from the head of the central government agency to which they belong, they shall notify the debtor of the following: |
| 1. | The type and amount of claim and the original and extended payment deadline; |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 24 (Deferment agreement for claims payable in installments) |
When a claims management officer enters into a deferment agreement under Article 27 (3) of the Act, they shall not extend the payment deadline of the amount to be repaid last beyond the extension period of the payment deadline of the amount to be repaid first; provided, if it is deemed favorable for collection, the extension may exceed such period, within the limit prescribed in Article 28 (1) of the Act. [This Article Wholly Amended on Feb. 11, 2014]
| Article 25 (Type of collateral for deferred payment and procedures for provision of collateral) |
| (1) | Article 17 and 17-2 shall apply mutatis mutandis to the provision of collateral under Article 29 (1) of the Act. |
| (2) | If a claims management officer intends to enter into a deferment agreement of secured claims, but the collateral is deemed inadequate, they shall require the debtor to provide additional collateral or replace the guarantor or collateral with another guarantor or collateral. |
| (3) | If the claim for which a deferment agreement is to be made falls under a case where it is substantially impracticable for the debtor to furnish collateral until the time of making such agreement, the claims management officer may set a deadline and require the debtor to furnish collateral after making the deferment agreement. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 26 (Interest rates on deferred payment) |
The interest rate on a claim, the payment period of which is extended under a deferment agreement 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 deferment agreement. [This Article Wholly Amended on Feb. 11, 2014]
| Article 27 (Debtors eligible for exemption from providing collateral for deferred payment) |
The following debtors may be exempted from providing collateral under the proviso of Article 29 (1) of the Act: | 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 deferment agreement with regard to a claim of restitution for unjust enrichment not resulting from the debtor’s intention or gross negligence; |
| 3. | A debtor who has no property to furnish as collateral and is unable to provide a guarantor; |
| 4. | A debtor for whom requiring the furnishing of collateral is likely to significantly hinder the performance of a public-interest project. |
[This Article Wholly Amended on 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 under a deferment agreement under the proviso of Article 29 (1) of the Act: | 1. | A person who meets the requirements under Article 27 (1) 1 of the Act; |
| 2. | A debtor whose total amount of interest on deferred payment is less than 1 thousand won. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 29 (Circumstances in which acquiring enforceable title is unnecessary) |
| (1) | "Circumstances provided by Presidential Decree" in Article 29 (2) of the Act means the following cases: |
| 1. | Claim for which a deferment agreement is made and reliable security is available; |
| 2. | Cases falling under subparagraph 1 or 2 of Article 27. |
| (2) | If a claims management officer finds that a debtor is unable to pay expenses incurred in acquiring an enforceable title, it need not acquire the enforceable title until the debtor becomes capable of paying the expenses. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 29-2 (Measures for acquisition of enforceable title) |
Where the claim management officer enters into a deferment agreement under Article 29 (1) of the Act, they shall notify the debtor of the act the debtor is required to perform and the deadline therefor, if it is necessary to obtain an enforceable title for the relevant claim; provided, where the claim falls under a case where obtaining an enforceable title is not required under Article 29 (1), the officer shall set a deadline and require the debtor to submit a debt certificate as prescribed by the Decree of the Ministry of Economy and Finance after entering into the deferment agreement. [This Article Wholly Amended on Feb. 11, 2014]
| Article 30 (Conditions attached to deferment agreement) |
| (1) | The following conditions shall be attached to a deferment agreement under Article 29 (3) of the Act: |
| 1. | Where it is necessary to preserve the claim: The claim management officer may ask the debtor or guarantor questions regarding their business or financial status, inspect books, documents, or other articles, or require the submission of materials, such as reports, which may serve as reference; |
| 2. | Where any of the following grounds exist: The condition under which the claims management officer may claim performance before the extended payment deadline: |
| a. | Where the debtor conceals or damages property, or is likely to do so, thereby causing or likely to cause disadvantage to the State; |
| b. | Where the debtor has falsely incurred another obligation; |
| c. | Where the payment deadline has been extended for a claim subject to installment payments, and the debtor fails to perform any installment; |
| d. | Where any of the grounds under the subparagraphs of Article 17 of the Act arises; |
| e. | Where the debtor violates the condition under subparagraph 1; |
| f. | Where the reason for extending the payment deadline ceases to exist due to changes in the debtor’s financial status or other relevant circumstances; |
| g. | Where the debtor fails to fulfill their obligations under Article 25 (3) and Article 29-2 due to a cause attributable to them. |
| (2) | A contract may include the condition stipulating that the debtor may be required to provide collateral or to pay interest on deferred payment if there is any change in the debtor’s financial status or other circumstances, even where it is agreed to exempt the debtor from providing collateral or paying interest on deferred payment under the proviso of Article 29 (1) of the Act. |
[This Article Wholly Amended on Feb. 11, 2014]
| (1) | A debtor who intends to be granted release from obligations (including overdue charges) 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 Decree of the Ministry of Economy and Finance with the competent claims management officer. In such cases, the claims management officer shall verify the certified copy of the resident registration card of the applicant (or the corporation registration certificate, if the applicant is a corporation) through administrative data matching under Article 36 (1) of the Electronic Government Act; and if the applicant is an individual and does not consent to such verification, they shall be required to submit the certified copy of their resident registration card. |
| (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 verify whether the debtor has any property, as prescribed by Decree of the Ministry of Economy and Finance; provided, this shall not apply where the amount of claim is less than 100,000 won. |
| (3) | Where a claims management officer, based on the results of the investigation and verification under paragraph (2), finds that the requirements under Article 31 of the Act are met and intends to release a debtor from the obligation, they shall submit the following documents to the head of the central government agency to which they belong, 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 they belong, they 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 deferment agreement under Article 31 (2) of the Act. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 32 (Scope of claims eligible for exemption from payment of overdue charges) |
A debtor may be exempted from paying overdue charges in cases falling under Article 32 (2) of the Act: | 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. | Amount of unjust enrichment to be returned, not caused by the debtor’s intention or gross negligence. |
[This Article Wholly Amended on Feb. 11, 2014]
CHAPTER V SUPPLEMENTARY PROVISIONS
| Article 33 (Matters to be stipulated in contracts) |
| (1) | The terms and conditions of a contract under Article 33 (2) of the Act shall be prescribed as follows: |
| 1. | The payment of overdue charges where the debtor fails to perform their obligation by the payment deadline; |
| 2. | The collection of all or part of the claim amount before the payment deadline, where a contract involves a claim subject to installment payments and any installment is in default; |
| 3. | The provision of additional collateral, replacement of the guarantor, or substitution of the collateral, where a contract involves a secured claim and the value of the collateral decreases or the guarantor becomes inadequate; |
| 4. | The investigation of the business and financial status of the debtor or guarantor, or the request for submission of relevant materials, where necessary to preserve the claim; |
| 5. | The collection of all or part of the claim amount before the payment deadline, where the debtor fails to comply with the request under subparagraph 4. |
| (2) | In the case of a loan claim for which the use is specified, the terms and conditions of the contract shall, in addition to the matters referred to in the subparagraphs of paragraph (1), include the following matters: |
| 1. | The collection of all or part of the claim amount before the payment deadline, where the debtor fails to use the loan for its intended purpose by the deadline; |
| 2. | The collection of all or part of the claim amount before the payment deadline, where the debtor fails to faithfully perform the obligations stipulated in the loan agreement. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 34 (Report on current amount of claims) |
| (1) | A report on the current amount of claims prepared under Article 36 of the Act shall specify the following: |
| 1. | The classification of claims by account and by type; |
| 2. | Details of any increase or decrease in the claim amount and whether the payment deadline has arrived. |
| (2) | Accounting treatment, including valuation, necessary for preparing the report on the current amount of claims under paragraph (1) shall be conducted in accordance with the national accounting standards under Article 11 of the National Accounting Act. |
| (3) | The form for a report on the current amount of claims under paragraph (1) shall be prescribed by Decree of the Ministry of Economy and Finance. |
[This Article Wholly Amended on Feb. 11, 2014]
| Article 35 (Settlement of claims extinguished within the closing period for receipt and disbursement) |
When preparing the report on the current amount of claims under Article 36 of the Act, any claim that constitutes revenue of the relevant fiscal year or a refund under expenditure, and is collected by the closing period for receipt and disbursement, shall be settled by including the amount in the relevant account of the revenue or expenditure of the corresponding fiscal year. [This Article Wholly Amended on Feb. 11, 2014]
| Article 36 (Payment of monetary awards) |
| (1) | An amount specified in the following table may be paid as a monetary award to a person who reports a delinquent debtor’s concealed property in accordance with Article 38 (1) of the Act, based on the amount collected from the concealed property so reported (hereafter in this Article referred to as "collected amount"); provided, an amount exceeding 100 million won shall not be paid, if a monetary award exceeds 100 million won: |
Recovered AmountAmount Payable
Not less than 20 million won, not more than 200 million wonAn amount equivalent to 15 percent of the collected amount
Greater than 200 million won, not more than 500 million won30 million won + An amount equivalent to 10 percent of the amount exceeding 200 million won out of the collected amount
Greater than 500 million won60 million won + An amount equivalent to 5 percent of the amount exceeding 500 million won out of the collected amount
| (2) | “Amount prescribed by Presidential Decree” in the proviso of Article 38 (1) of the Act means 20 million won. |
| (3) | “Properties prescribed by Presidential Decree” in Article 38 (2) 3 of the Act mean real property registered in the name of the delinquent debtor in the Republic of Korea. |
| (4) | The head of a central government agency shall pay a monetary award under Article 38 (1) of the Act within 2 months from the last day of the month in which an amount equivalent to the overdue debts of a delinquent debtor who has concealed property is recovered in cash. |
| (5) | Where a person who has reported a delinquent debtor’s concealed property under Article 38 (1) of the Act is to be paid a monetary award, if duplicate reports are made on the same case, the monetary award shall be paid only to the person who made the first report. |
| (6) | Except as provided in paragraphs (4) and (5), matters necessary for the detailed methods of paying monetary awards shall be determined by the Minister of Economy and Finance. |
[This Article Added on Feb. 11, 2014]
[Previous Article 36 moved to Article 37 <Feb. 11, 2014>]
| Article 37 (Consultation on statutes or regulations concerning claims management) |
When the head of a central government agency intends to draft a statute or regulation relating to claims management and submit it to the Ministry of Government Legislation, they shall have a prior consultation with the Minister of Economy and Finance.
[This Article Wholly Amended on Feb. 11, 2014]
[Moved from Article 36; previous Article 37 moved to Article 38 <Feb. 11, 2014>]
| Article 38 (Processing of personally identifiable information) |
| 1. | Overdue debt collection duties entrusted under Article 14-2 (1) of the Act; |
| 2. | Provision of data on delinquency or suspension of management under Article 25-2 of the Act; |
| 3. | Payment of monetary awards under Article 38 of the Act; |
[This Article Wholly Amended on Feb. 11, 2014]
[Moved from Article 37 <Feb. 11, 2014>]
ADDENDUM <Presidential Decree No. 5703, Jul. 15, 1971>
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.)
ADDENDA <Presidential Decree No. 14063, Dec. 31, 1993>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 1994.
ADDENDA <Presidential Decree No. 14438, Dec. 23, 1994>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 17048, Dec. 29, 2000>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 2001.
ADDENDA <Presidential Decree No. 17824, Dec. 30, 2002>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 2003. (Proviso 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.
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; provided, the part of Presidential Decree amended by Article 8 of the Addenda, which was promulgated before the Enforcement Decree of the Certified Tax Accountant Act enters into force but the enforcement date of which has not arrived yet, shall enter into force on the enforcement date of the relevant Presidential Decree.
ADDENDA <Presidential Decree No. 20947, Jul. 29, 2008>
Article 1 (Enforcement date)
This Decree shall enter into force on February 4, 2009. (Proviso 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.
ADDENDA <Presidential Decree No. 22493, Nov. 15, 2010>
Article 1 (Enforcement date)
This Decree shall enter into force on November 18, 2010.
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.
ADDENDA <Presidential Decree No. 29181, Sep. 18, 2018>
Article 1 (Enforcement date)
This Decree shall enter into force on September 21, 2018.
ADDENDA <Presidential Decree No. 30759, Jun. 9, 2020>
Article 1 (Enforcement date)
This Decree shall enter into force on June 11, 2020.
ADDENDA <Presidential Decree No. 30893, Aug. 4, 2020>
Article 1 (Enforcement date)
| (1) | This Decree shall enter into force on August 5, 2020. (Proviso Omitted.) |
ADDENDA <Presidential Decree No. 32449, Feb. 17, 2022>
Article 1 (Enforcement date)
This Decree shall enter into force on February 18, 2022.