ENFORCEMENT DECREE OF THE LOCAL FINANCE ACT
Wholly Amended by Presidential Decree No. 19226, Dec. 30, 2005
Amended by Presidential Decree No. 20445, Dec. 13, 2007
Presidential Decree No. 20504, Dec. 31, 2007
Presidential Decree No. 20741, Feb. 29, 2008
Presidential Decree No. 21087, Oct. 20, 2008
Presidential Decree No. 21214, Dec. 31, 2008
Presidential Decree No. 21260, Jan. 13, 2009
Presidential Decree No. 21495, May 21, 2009
Presidential Decree No. 21656, Jul. 30, 2009
Presidential Decree No. 21801, Nov. 2, 2009
Presidential Decree No. 22493, Nov. 15, 2010
Presidential Decree No. 22532, Dec. 20, 2010
Presidential Decree No. 22564, Dec. 29, 2010
Presidential Decree No. 23121, Sep. 6, 2011
Presidential Decree No. 23573, Jan. 31, 2012
Presidential Decree No. 23645, Feb. 29, 2012
Presidential Decree No. 23674, Mar. 26, 2012
Presidential Decree No. 24425, Mar. 23, 2013
Presidential Decree No. 25103, Jan. 17, 2014
Presidential Decree No. 25226, Mar. 5, 2014
Presidential Decree No. 25532, Aug. 6, 2014
Presidential Decree No. 25751, Nov. 19, 2014
Presidential Decree No. 25781, Nov. 28, 2014
Presidential Decree No. 26572, Oct. 6, 2015
Presidential Decree No. 26691, Dec. 4, 2015
Presidential Decree No. 27268, jun. 28, 2016
Presidential Decree No. 27299, jun. 30, 2016
Presidential Decree No. 27463, Aug. 29, 2016
Presidential Decree No. 27621, Nov. 29, 2016
Presidential Decree No. 27959, Mar. 27, 2017
Presidential Decree No. 28211, Jul. 26, 2017
Presidential Decree No. 28521, Dec. 29, 2017
Presidential Decree No. 29440, Dec. 31, 2018
Presidential Decree No. 30500, Mar. 3, 2020
Presidential Decree No. 33739, Sep. 26, 2023
CHAPTER I GENERAL PROVISIONS
The purpose of this Decree is to provide for the matters entrusted by the Local Finance Act and other matters necessary for the enforcement thereof.
| Article 1-2 (Evaluation of Main Financial Activities) |
| (1) | Main financial activities subject to evaluation under Article 5 (3) of the Local Finance Act (hereinafter referred to as the “Act”) are as follows: Provided, That excluded herefrom are the local government-subsidized projects provided for in Article 32-2 (1) of the Act and the projects subject to mandatory budget compilation under statutes or regulations: <Amended on Jun. 28, 2016; Apr. 28, 2020> |
| 1. | Special Metropolitan City, Metropolitan City, Special Self-Governing City, Do and Special Self-Governing Province (hereinafter referred to as "City/Do"); |
| (a) | An investment project, the total project cost of which is at least 500 million won; |
| (b) | An event project, such as a performance or festival; |
| 2. | A Si/Gun/autonomous Gu: |
| (a) | An investment project, the total project cost of which is at least 200 million won; |
| (b) | An event project, such as a performance or festival; |
| (2) | The Minister of the Interior and Safety may determine the criteria for the subject matter, methods, procedures, etc. for evaluation of the major financial activities under paragraph (1) and give notice thereof to the heads of local governments. <Amended on Jul. 26, 2017> |
[This Article Newly Inserted on Nov. 28, 2014]
| 2. | Deleted. <Nov. 29, 2016> |
| Article 3 Deleted. <Nov. 29, 2016> |
| Article 4 Deleted. <Nov. 29, 2016> |
| Article 5 Deleted. <Nov. 28, 2014> |
| Article 6 (Application of Matters concerning Education, Science, and Physical Education) |
With respect to matters concerning education, science and physical education or the special account for educational expenses prescribed in this Decree, the "head of a local government" or the "Mayor/Do Governor or the head of a Si/Gun/autonomous Gu" shall be construed as the "superintendent of education," the "Minister of the Interior and Safety" shall be construed as the "Minister of Education," and "Ordinance of the Ministry of the Interior and Safety" shall be construed as "Ordinance of the Ministry of Education", respectively. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017>
| Article 7 (Types of Local Government Bonds) |
| 1. | Local government bonds issued as securities: These local government bonds refer to bonds issued by means of the issuance of securities in order to obtain borrowings and the same shall apply where such local government bonds are issued overseas; |
| 2. | Borrowings: Such borrowings refer to local government bonds by which local governments obtain borrowings by means of the issuance of deeds, and the same shall apply where local governments introduce loans (including loans in kind) from any foreign government and any international organization, etc. |
| Article 8 (Special Case concerning Local Government Bonds Issued as Securities) |
| (1) | Local government bonds issued as securities, as prescribed by the provisions of subparagraph 1 of Article 7 may be issued by means of the delivery of local government bonds issued as securities in lieu of fulfilling the obligations of local governments. |
| (2) | Where any local government intends to issue local government bonds issued as securities overseas or to issue local government bonds issued as securities that are denominated in any foreign currency in the Republic of Korea, such local government shall issue such local government bonds according to the procedures that are set by the Foreign Exchange Transactions Act and the Enforcement Decree therefor and develop and implement a foreign exchange risk management plan. |
| Article 9 Deleted. <Nov. 28, 2014> |
| Article 10 (Calculation, etc. of Limit of Amount for Issuance of Local Government Bonds) |
| (1) | No local government bonds may be issued under Article 11 (2) of the Act, if the total project cost is less than the amount provided for in Article 41 (1) 1 (a) and 2 (a): Provided, That the same shall not apply where any borrowing is made to upgrade an office building. <Newly Inserted on Nov. 28, 2014> |
| (2) | The amount of the local government bond issuance limit pursuant to Article 11 (2) of the Act shall be an amount determined by the head of the local government in the range of 10/100 of the budget of the year before the preceding year of the local government in accordance with the criteria for calculating the local government bond issuance limit prescribed by the Minister of the Interior and Safety, taking into account the following matters: <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017; Apr. 28, 2020> |
| 2. | The amount any local government is liable to repay on the grounds of the debtor's bankruptcy, etc. among the amount of the obligations guaranteed pursuant to Article 13 of the Act; |
| 4. | Other matters determined by the Minister of the Interior and Safety, such as the amount of obligations, the schedule for repaying obligations and the level of financial burden of the relevant local government. |
| (3) | Notwithstanding paragraph (2), the Special Metropolitan City Mayor, a Metropolitan City Mayor, a Special Self-Governing City Mayor, a Do Governor, and a Special Self-Governing Province Governor (hereinafter referred to as "Mayor/Do Governor") may set an additional local government bond issuance limit if necessary for the smooth business progress of the administrative organization (including the joint administrative organization pursuant to the latter part of the same paragraph) established pursuant to Article 27-2 (1) of the Act on Designation and Management of Free Economic Zones. In such cases, the aggregate of the limit of issuance of local government bonds and the limit of issuance of local government bonds determined pursuant to paragraph (2), shall not exceed 10/100 of the budget of the year before the preceding year of the relevant City/Do. <Amended on Apr. 28, 2020> |
| (4) | Deleted. <Apr. 28, 2020> |
| Article 11 (Procedures for Issuance of Local Government Bonds) |
| (1) | The Minister of the Interior and Safety shall notify the head of each local government of the criteria for establishing a local government bond issuance plan for the following year, including the criteria for calculating the amount of the local government bond issuance limit under Article 10 (2) by no later than July 1 of each year. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017; Apr. 28, 2020> |
| (2) | The head of a local government in receipt of the notification under paragraph (1) shall determine the ceiling of the issuance of local government bonds in the year following the relevant local government pursuant to Article 10 (2) and (3) and notify the Minister of the Interior and Safety thereof by July 15. <Newly Inserted on Apr. 28, 2020> |
| (3) | The Minister of the Interior and Safety shall examine the appropriateness of the ceiling of issuance of local government bonds notified by the head of a local government pursuant to paragraph (2) and may request the head of a local government to supplement the ceiling, if necessary. In such cases, the Minister of the Interior and Safety may request the head of a local government to submit data related to the calculation of the ceiling for the issuance of local government bonds in order to examine the appropriateness thereof. <Newly Inserted on Apr. 28, 2020> |
| (4) | Where the head of a local government intends to issue foreign bonds pursuant to the provisions of Article 11 (2) of the Act in the following year, or where the head of a local government association (hereinafter referred to as "local government association") pursuant to Article 176 of the Local Autonomy Act intends to issue local government bonds pursuant to Article 11 (4) of the Act in the following year, he or she shall submit a local government bond issuance plan for the following year prepared in accordance with the standards for establishing local government bond issuance plans pursuant to paragraph (1) to the Minister of the Interior and Safety for approval by August 31. <Amended on Apr. 28, 2020; Dec. 16, 2021> |
| (5) | Where the head of a local government intends to issue local government bonds in excess of the ceiling for the issuance of local government bonds pursuant to Article 11 (3) of the Act in the following year, he or she shall submit a draft plan for the issuance of local government bonds formulated pursuant to the standards for the formulation of a plan for the issuance of local bonds prescribed in paragraph (1), to the Minister of the Interior and Safety to consult thereon: Provided, That where the percentage of debt to the budget pursuant to Article 65 (4) 2 of the following year exceeds 25/100 when local government bonds are issued in excess of the ceiling for the issuance of local government bonds, approval shall be requested from the Minister of the Interior and Safety pursuant to the proviso of Article 11 (3) of the Act. <Newly Inserted on Apr. 28, 2020> |
| (6) | Where the head of a Si/Gun/autonomous Gu notifies the limit of issuance of local government bonds for the following year pursuant to paragraph (2) or submits a draft plan for issuance of local government bonds for the following year pursuant to paragraphs (4) and (5), he or she shall submit the draft plan through the Mayor/Do Governor. <Newly Inserted on Apr. 28, 2020> |
| (7) | Upon receipt of request under paragraphs (4) and (5), the Minister of the Interior and Safety shall determine and notify the results of consultation or whether to approve by no later than October 31, after consulting thereon with the heads of the relevant central government agencies (referring to central government agencies prescribed in Article 6 (2) of the National Finance Act; hereinafter the same shall apply). <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017; Apr. 28, 2020> |
| (8) | Where the head of a local government or the head of the Association of Local Governments intends to issue local government bonds in excess of the limit of amount for the issuance of local government bonds during the fiscal year, he/she shall obtain additional approval therefor from the Minister of the Interior and Safety, notwithstanding paragraphs (2) and (3). <Amended on Apr. 28, 2020> |
| Article 12 (Procedures for Acquisition of Local Government Bonds) |
| (1) | Each local government that intends to obtain borrowings in the following year from the special account, funds and office building upgrade funds, or similar from the central government shall submit a draft plan for issuing local government bonds for the following year, which is formulated in compliance with the standards set by the Minister of the Interior and Safety, to the Minister of the Interior and Safety by no later than August 31. In such cases, the draft plan for issuing local government bonds by a Si/Gun/autonomous Gu shall be submitted to the Minister of the Interior and Safety via the competent Mayor/Do Governor. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| (2) | The Minister of the Interior and Safety shall consult with the heads of relevant central government agencies or the head of the Association of Local Governments, etc. on the draft plan for issuing local government bonds submitted under paragraph (1) and then notify the relevant local governments of the result of such consultations by no later than October 31. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017> |
| (3) | Each Si/Gun/autonomous Gu that intends to obtain borrowings in the following year from the fund, etc. for the community development under Article 19 (2) of the Local Public Enterprises Act shall submit a draft plan for issuing local government bonds for the following year in compliance with the standards set by the Minister of the Interior and Safety, to a Mayor/Do Governor by no later than July 31. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| Article 13 (Local Government Bonds Issued as Securities by Means of Public Offering) |
| (1) | When any local government issues local government bonds issued as securities in a manner of offering provided for in Article 12 of the Act, such local government shall prepare a subscription form for the local government bonds issued as securities, in which the matters falling under each of the following subparagraphs are entered: |
| 1. | The name of the local government; |
| 2. | The total amount of local government bonds issued as securities; |
| 3. | Purposes of the local government bonds issued as securities; |
| 4. | The face value of each of the local government bonds as securities; |
| 5. | The value issued or the minimum value of each of local government bonds as securities; |
| 6. | The interest rate of local government bonds issued as securities; |
| 7. | The repayment of local government bonds issued as securities, means to pay interest and the time limit for paying such interest; |
| 8. | When the payment by frequent installations of the local government bonds issued as securities is prescribed, the amount of payment by frequent installments and the timing therefor; |
| 9. | When local government bonds issued as securities are limited to registered local government bonds or non-registered local government bonds, the rationale therefor; |
| 10. | When any company is commissioned to make a public offering of local government bonds issued as securities, its trading name and address; |
| 11. | Where the subscription amount of the local government bonds issued as securities falls short of the total amount thereof issued, when anyone is contracted to acquire the balance thereof, the rationale therefor; |
| 12. | When any transfer agent is hired, his/her name, address or place of business; |
| 13. | The deadline for subscribing to local government bonds issued as securities. |
| (2) | Anyone who intends to subscribe to local government bonds issued as securities shall record the number of local government bonds issued as securities he/she intends to acquire and his/her address in a subscription form for local government bonds issued as securities referred to in the provisions of paragraph (1) and then write his/her name and affix his/her seal thereon. |
| (3) | Where the minimum value of each local government bond issued as a security is set, subscribers shall each enter the subscription value in the subscription form for local government bonds issued as securities. |
| (4) | Any company that is commissioned to offer local government bonds issued as securities may perform acts referred to in paragraph (1) in the name of the local government that commissions him/her to do so. |
| Article 14 (Special Case of Subscribing to Total Amount of Local Government Bonds Issued as Securities) |
The provisions of Article 13 shall not apply to cases where anyone subscribes to the total amount of local government bonds issued as securities under a contract. Where any company that is commissioned to offer local government bonds issued as securities subscribes to part of such local government bonds issued as securities, the provisions of Article 13 shall not apply to the part of the local government bonds subscribed, either.
| Article 15 (Special Case concerning Instance Where Subscribed Amount of Local Government Bonds Issued as Securities Falls Short of Total Amount of Local Government Bonds Issued as Securities) |
Even where the subscribed amount of local government bonds issued as securities falls short of the total amount of local government bonds issued as securities, as entered in the subscription form for the local government bonds issued as securities, when the establishment of the local government bonds issued as securities is mentioned in the subscription form for the local government bonds issued as securities, the subscribed amount may be deemed the total amount of the relevant local government bonds issued as securities.
| (1) | When the offering of local government bonds issued as securities is completed, local governments shall cause subscribers to pay without delay for the total amount of local government bonds issued as securities or pay the first installment amount. |
| (2) | Any company that is commissioned to offer local government bonds issued as securities may perform the act referred to in the provisions of paragraph (1) for the local government that commissions it to do so in the latter's name. |
| Article 17 (Issuance of Securities) |
| (1) | When the total amount of local government bonds issued as securities is paid, local governments shall issue such securities without delay. |
| (2) | The matters falling under each of the following subparagraphs shall be noted on the local government bonds issued as securities and the heads of local governments shall subscribe their names and affix their seals thereon: |
| 1. | The number of local government bonds issued as securities; |
| 2. | Matters provided for in the provisions of Article 13 (1) 1 through 4, 6, 7, 9, 10 and 12; |
| 3. | The date of issuance of the local government bonds issued as securities. |
| Article 18 (Issuance of Local Government Bonds Issued as Securities by Way of Sale) |
When local governments issue local government bonds issued as securities by way of sale, they shall publicly announce the matters falling under each of the following subparagraphs:
| 1. | Matters provided for in the provisions of Article 13 (1) 1 through 4, 6, 7, 9 and 12; |
| 2. | The period during which the local government bonds issued as securities are offered for sale; |
| 3. | The sale value of the local government bonds issued as securities; |
| 4. | When any company is commissioned to sell the local government bonds issued as securities, its trading name and address. |
| Article 19 (Special Case concerning Instance Where Total Sale Amount of Local Government Bonds Issued as Securities Falls Short of Total Amount) |
Even where the total amount of local government bonds issued as securities during the sales period falls short of the total amount of local government bonds issued as securities, which are publicly announced pursuant to Article 18, when the completion of the sales of local government bonds issued as securities is specified on the public announcement, the total amount of sales shall be deemed the total amount of relevant local government bonds issued as securities.
| Article 20 (Conversion between Registered Securities and Non-Registered Securities) |
Creditors of local government bonds may request the relevant local government to convert registered securities into non-registered securities or non-registered securities into registered securities, except where securities are limited to registered securities or non-registered securities.
| Article 21 (Ledger of Local Government Bonds Issued as Securities) |
| (1) | When any local government issues its local government bonds as securities, such local government shall prepare and keep a ledger of local government bonds issued as securities. |
| (2) | Where any registered securities are issued, the matters falling under each of the following subparagraphs shall be entered in the ledger of local government bonds issued as securities: |
| 1. | The number of local government bonds issued as securities; |
| 2. | The matters provided for in the provisions of Article 13 (1) 2 through 10 and 12; |
| 3. | The amount and date of payment of each local government bond issued as a security; |
| 4. | The date on which local government bonds issued as securities are issued; |
| 5. | The acquisition date of each local government bond issued as a security; |
| 6. | Matters concerning the payment of principal and interest; |
| 7. | The names (in the case of a corporation, its trading name) and addresses of creditors of local government bonds. |
| (3) | Except as provided in paragraph (2) 1 through 6, where non-registered securities are issued, the kinds and number of the securities shall be entered in the ledger of local government bonds issued as securities. |
| (4) | When any local government is notified by a pledger of the fact that registered local government bonds issued as securities have become subject to a right of pledge, the name (in the case of any corporation, its trading name) and address of the pledgee shall be entered in the ledger of local government bonds issued as securities. |
| Article 22 (Lottery Repayments of Local Government Bonds Issued as Securities) |
| (1) | Where any local government intends to repay part of any local government bonds issued as securities by way of lottery, such local government shall publicly announce in advance the amount of the repayment, the repayment date, the date and place where the lottery is made and means of conducting the lottery. |
| (2) | The local government shall publicly announce the winning number by grouping of face value of local government bonds issued as securities by way of lottery as provided for in paragraph (1). |
| Article 23 (Case of Deficiency in Right and Interest) |
| (1) | Where non-registered local government bonds issued as securities with the rights and interests are repaid, when the right and interest are partially defective on the grounds of contamination or damage, the amount equivalent to the defective part shall be deducted from the amount repaid. |
| (2) | The holder of the rights and interests referred to in the provisions of paragraph (1) may claim payment of the deducted amount in exchange for such right and interest at any time and the relevant local government shall comply with such claim. |
| Article 24 (Special Case concerning Local Government Bonds Issued as Securities in Foreign Currency) |
The issuance of local government bonds issued as securities overseas, which are denominated in any foreign currency (hereinafter referred to as "local government bonds issued as securities in foreign currency"), the conversion between registered local government bonds issued as securities in foreign currency and non-registered local government bonds issued as securities in foreign currency, the register of local government bonds issued as securities in foreign currency, lottery repayment of local government bonds issued as securities in foreign currency, repayment of local government bonds issued as securities in foreign currency with defective rights and interests therein and payments to the holders of rights and interests, etc. may be governed by statutes or regulations or customs of the country where the local government bonds issued as securities are issued, notwithstanding the provisions of this Decree.
| Article 25 (Methods of Public Announcement) |
Public announcement on local government bonds issued as securities shall be published in the public gazette of the relevant local government or in daily newspapers.
| Article 26 (Approval for and Management of Guaranteed Obligations) |
| (1) | Anyone who intends to obtain a guarantee from any local government for fulfilling his/her obligations pursuant to Article 13 (1) of the Act shall file an application in advance for an obligation guarantee, in which the names of the creditor and debtor, the amount for repayment, etc. are entered, with the head of the relevant local government. |
| (2) | In the written statement indicating that the relevant local government guarantees the fulfillment of the principal obligations pursuant to Article 13 (2) of the Act, the scope of the principal obligations that are borne by the relevant local government and matters that both the creditors and debtor are required to observe shall be noted. |
| Article 27 Deleted; <Nov. 29, 2016> |
| Article 28 Deleted. <Nov. 29, 2016> |
| Article 29 (Restrictions on Donations or Subsidies) |
| (1) | Deleted. <Sep. 6, 2011> |
| (3) | "Which is deemed necessary for a project recommended by a local government" in Article 17 (1) 4 of the Act means where it is impractical to conduct the project recommended by the relevant local government, relating to administrative affairs within the jurisdictions of such local government, unless a subsidy is provided for such project. |
| (4) | Deleted. <Apr. 6, 2011> |
| (5) | Filing applications for subsidization or expenditure of public money by local governments under Article 17 (1) of the Act, and determinations to grant such subsidization or expenditure, use of such subsidies or public money, and other necessary matters shall be prescribed by ordinance of relevant local government in compliance with the standards prescribed by the Minister of the Interior and Safety. <Amended on Nov. 28, 2014; Jul. 26, 2017> |
[Title Amended on Nov. 28, 2014]
| Article 30 (Scope of Public Corporations) |
"Public corporation, the members of which are local governments" in Article 17 (2) 2 of the Act means a corporation established after obtaining authorization therefor from the Minister of the Interior and Safety with the investment made by various levels of local governments as financial resources for their funds in order to restore public buildings to their original condition after being effected by disasters under subparagraph 1 of Article 3 of the Framework Act on the Management of Disasters and Safety (hereinafter referred to as "disaster"), to upgrade public office buildings, to create and manage public property and to facilitate the international exchange programs of local governments, etc. <Amended on Feb. 29, 2008; Sep. 6, 2011; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017; Sep. 26, 2023>
| Article 30-2 Deleted. <Nov. 28, 2014> " |
| Article 30-3 Deleted. <Nov. 28, 2014> |
| Article 30-4 Deleted. <Nov. 28, 2014> |
| Article 31 (Establishment, etc. of Advisory Councils for Each Field) |
| (1) | The Minister of the Interior and Safety shall establish advisory councils for each field pursuant to Article 19 of the Act. The advisory councils for each field shall be comprised of not more than 10 members, including one chairperson, who are appointed or commissioned by the Minister of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| (2) | The Advisory Council for Local Financial Policy shall be established within the Ministry of the Interior and Safety to advise the Minister of the Interior and Safety on the management of the finances of local governments and the Advisory Council for Local Financial Policy shall be comprised of not more than 20 members, including one chairperson, who are appointed or commissioned by the Minister of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| (3) | The advisory councils for each field established under paragraph (1) may table the agenda on local finances to the Advisory Council for Local Financial Policy under paragraph (2) for its deliberation. |
| (4) | Detailed matters necessary the composition and operation of the advisory councils for each field and the Advisory Council for Local Financial Policy under paragraphs (1) and (2) shall be prescribed by the Minister of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
CHAPTER II ASSUMPTION OF EXPENSES
| Article 32 (Restrictions on Disbursement of Expenses) |
In disbursing expenses, every local government shall disburse such expenses only for performing the clerical work under its jurisdiction and shall be prohibited from disbursing any expense for performing the clerical work of the State, the clerical work of other local governments or educational clerical work without grounds provided therefor in statutes or regulations.
| Article 33 (Items of Expenses Borne by Local Governments) |
| (1) | Pursuant to Article 22 (1) of the Act, the items and proportions of expenses (excluding amounts financed by state financing and amounts to be borne by beneficiaries) to be borne by Cities/Dos and Sis/Guns and autonomous Gus, respectively, shall be determined by Ordinance of the Ministry of the Interior and Safety, taking into account the nature of the project, the scope of the effect of the project, and the interests of local governments in the project: Provided, That the same shall not apply where other statutes or regulations prescribe otherwise. <Amended on Apr. 28, 2020> |
| (2) | Where it is deemed necessary on the grounds of the financial situation of a Si/Gun/autonomous Gu, a Mayor/Do Governor may bear additional expenses in excess of the standard burden ratio, notwithstanding the burden ratio set by Ordinance of the Ministry of the Interior and Safety pursuant to paragraph (1) (hereinafter referred to as "standard burden ratio"). <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| Article 34 (Filing Applications for Government Subsidies) |
Where the head of a local government reports the details of an application for earmarking subsidies from the National Treasury in the budget to the Minister of the Interior and Safety pursuant to Article 24 of the Act, he/she shall include materials and opinions that are submitted to the Minister of Economy and Finance or the heads of central government agencies pursuant to Articles 8 and 11 of the Subsidy Management Act in their respective reports. <Amended on Feb. 29, 2008; Dec. 31, 2008; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017> [Title Amended on Nov. 28, 2014]
| Article 35 (Organization of Committee for Deliberation on Local Financial Obligations) |
| (1) | “Related central government agencies prescribed by Presidential Decree” in Article 27-2 (4) 1 of the Act means central government agencies, such as the Office for Government Policy Coordination, that are related to an agenda laid before the Committee for Deliberation on Local Financial Obligations (hereinafter referred to as the “Committee for Deliberation on Local Financial Obligations”) under paragraph (1) of the same Article, as designated by the chairperson of such Committee in advance every meeting. <Amended on Jan. 17, 2014; Nov. 28, 2014> |
| (2) | Deleted. <Jan. 17, 2014> |
| (3) | The terms of office of members referred to in Article 27-2 (4) 2 and 3 of the Act shall be two years: Provided, That a member appointed to fill a vacancy occurring before the expiration of the term for which his/her predecessor was appointed shall serve for the remainder of such term. <Amended on Jan. 17, 2014> |
| (4) | The National Conference of Mayors/Do Governors, the National Conference of Heads of Sis/Guns/Gus, the National Conference of Chairpersons of Local Councils of Cities and Dos, or the National Conference of Chairpersons of Local Councils of Si/Guns/Gus may withdraw the recommendation of a member under Article 27-2 (4) 2 of the Act if he/she falls under any of the following: <Newly Inserted on Oct. 6, 2015> |
| 1. | Where the member becomes unable to perform his/her duties due to physical or mental disorders; |
| 2. | Where the member engages in misconduct in relation to his/her duties; |
| 3. | Where the member is deemed unfit to be in office as member on the grounds of neglect of duty, loss of dignity or for other reason; |
| 4. | Where the member personally makes it clear that it is impracticable to perform his/her duties. |
| (5) | The Prime Minister may withdraw the commission of a member under Article 27-2 (4) 3 of the Act if he/she falls under any subparagraph of paragraph (4). <Newly Inserted on Oct. 6, 2015> |
[This Article Wholly Amended on Jan. 31, 2012]
| Article 35-2 (Operation of Committee for Deliberation on Local Financial Obligations) |
| (1) | The chairperson of the Committee for Deliberation on Local Financial Obligations (hereafter in this Article referred to as the "Chairperson") shall convene its meetings and preside over the meetings. |
| (2) | Where the Chairperson is unable to perform his/her duties due to unavoidable circumstances, the vice chairperson pre-designated by the Chairperson shall act on behalf of the Chairperson. |
| (3) | The Committee for Deliberation on Local Financial Obligations shall hold a meeting with a majority of all incumbent members present and pass resolutions with the consent of a majority of the members present. |
| (4) | Where the head of a local government advances his/her opinion in relation to matters referred to in the subparagraphs of Article 27-2 (1) of the Act, the Minister of the Interior and Safety may request the Chairperson to refer such opinion to deliberation at meetings of the Committee for Deliberation on Local Financial Obligations, if he/she deems it necessary. <Amended on Nov. 19, 2014; Jul. 26, 2017> |
| (5) | Where necessary for deliberation, the Chairperson may request related institutions to submit necessary data or opinions, or require related public officials or nongovernmental experts to attend meetings to hear their opinions. |
| (6) | The Minister of the Interior and Safety shall immediately notify each central government agency and each local government of matters on which the Committee for Deliberation on Local Financial Obligations has passed resolutions so that they may take necessary measures. In such cases, the heads of the relevant central government agency and local government shall notify the Minister of the Interior and Safety of the measures taken following resolutions by the Committee, and the Minister of the Interior and Safety shall report the details thereof to the Committee. <Amended on Nov. 19, 2014; Nov. 28, 2014; Oct. 6, 2015; Jul. 26, 2017> |
| (7) | One administrative secretary shall be assigned to the Committee for Deliberation on Local Financial Obligations, and the Minister of the Interior and Safety shall appoint the administrative secretary from among members of the Senior Executive Service belonging to the Ministry of the Interior and Safety. <Amended on Nov. 19, 2014; Jul. 26, 2017> |
| (8) | Except as provided in paragraphs (1) through (7), matters necessary for the composition and operation of the Committee for Deliberation on Local Financial Obligations shall be prescribed by the Minister of the Interior and Safety. <Amended on Nov. 19, 2014; Jul. 26, 2017> |
[This Article Wholly Amended on Jan. 17, 2014]
| Article 35-3 (Organization and Operation of Working Committees) |
| (1) | Working committees referred to in Article 27-2 (6) of the Act (hereafter in this Article referred to as "Working Committee") shall be comprised of not more than 15 members, including one chairperson in consideration of gender composition, and the following persons shall serve as the members thereof: <Amended on Nov. 19, 2014; Jun. 28, 2016; Jul. 26, 2017> |
| 1. | Members of Senior Executive Service under the jurisdiction of the Ministry of Economy and Finance, the Ministry of the Interior and Safety and the Office for Government Policy Coordination; |
| 2. | One person each recommended by the National Conference of Mayors/Do Governors, the National Conference of Heads of Sis/Guns/Gus, the National Conference of Chairpersons of Local Councils of Cities and Dos, and the National Conference of Chairpersons of Local Councils of Si/Guns/Gus; |
| 3. | Other persons commissioned by the Minister of the Interior and Safety who have knowledge about, and expertise in, local finance. |
| (2) | Where the Chairperson cannot perform his or her duties due to any unavoidable reason, a member designated in advance by the Chairperson shall act for him or her. |
| (3) | One administrative secretary shall be assigned to each Working Committee, and the Minister of the Interior and Safety shall appoint the administrative secretary from among public officials of at least Grade IV under the jurisdiction of the Ministry of the Interior and Safety. <Amended on Nov. 19, 2014; Jul. 26, 2017> |
| (4) | The terms of office of members referred to in paragraph (1) 2 and 3 shall be two years: Provided, That a member appointed to fill a vacancy occurring before the expiration of the term for which his/her predecessor was appointed shall serve for the remainder of such term. |
| (5) | The Working Committees shall review the following matters: |
| 1. | Matters concerning items to be discussed at meetings of the Committee for Deliberation on Local Financial Obligations; |
| 2. | Matters which the Working Committees have been directed to review by the Committee for Deliberation on Local Financial Obligations; |
| 3. | Other matters necessary for the operation of the Working Committees. |
| (6) | Article 35-2 (1), (3), and (5) shall apply mutatis mutandis to the operation of the Working Committees. In such cases, "the Committee for Deliberation on Local Financial Obligations" shall be construed as "the Working Committees." |
| (7) | Article 35 (4) and (5) shall apply mutatis mutandis to the withdrawal of recommendation of a member under paragraph (1) 2 and the revocation of the commission of a member under paragraph (1) 3 among the members of the Working Committees. In such cases, “the Prime Minister” shall be construed as “the Minister of the Interior and Safety.” <Newly Inserted on Oct. 6, 2015; Jul. 26, 2017> |
| (8) | Except as provided in paragraphs (1) through (7), matters necessary for the composition and operation of the Working Committees shall be prescribed by the Minister of the Interior and Safety. <Amended on Nov. 19, 2014; Oct. 6, 2015; Jul. 26, 2017> |
[This Article Newly Inserted on Jan. 17, 2014]
[Previous Article 35-3 moved to Article 35-5 <Feb. 17, 2014>]
| Article 35-4 (Management of Government Subsidies) |
| (1) | The head of a central government agency shall notify the Minister of the Interior and Safety of the outcomes of Government subsidies granted to local governments pursuant to Article 27-4 (1) of the Act and the outcomes of subsidies used by the relevant local governments by no later than May 31 of the following year. <Amended on Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017> |
| (2) | The head of a central government agency that prepares the outcomes of Government subsidies granted to local governments pursuant to paragraph (1) and the outcomes of subsidies used by the relevant local governments, shall do so separately or each local government. <Amended on Nov. 28, 2014> |
| (3) | The Minister of the Interior and Safety shall comprehensively analyze the outcomes of Government subsidies granted to local governments pursuant to paragraph (1) and the outcomes of subsidies used by the local governments notified by a central government agency pursuant to Article 27-4 (2) of the Act and publish such outcomes via the Internet website, etc. <Amended on Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017> |
[This Article Newly Inserted on Jan. 17, 2014]
| Article 35-5 (Local Projects Subject to Assessment of Impacts on Local Government Finance) |
| (1) | Projects subject to assessment by the head of a local government under the latter part of Article 27-6 (1) of the Act are as follows: <Amended on Jun. 28, 2016; Sep. 26, 2023> |
| 1. | Event-based projects such as national and international athletic competitions, performances, and festivals, where the total project cost is more than the amount under each of the following categories: |
| (a) | Cities/Dos: 3 billion won; |
| (b) | Sis/Guns/Autonomous Gus: 1 billion won; |
| 2. | A public contest, etc. subject to a bid or an application, the total project cost of which is at least ten billion won and the amount of local financial burden is at least five billion won. |
| (2) | Notwithstanding paragraph (1), any of the following projects shall be exempt from local projects subject to assessment: <Newly Inserted on Jun. 28, 2016; Jul. 26, 2017> |
| 1. | A project whose impact on local government finance was assessed in the preceding year or the year before the preceding year pursuant to Article 27-6 (1) of the Act, which is an event project, such as a performance or festival repeatedly held every year or every other year: Provided, That the foregoing shall not apply to a project whose total project cost has increased 20 percent or more from the preceding year (in cases of an event project held every other year, referring to the year before the preceding year); |
| 2. | A project prescribed and publicly notified by the Minister of the Interior and Safety among projects mandatorily implemented pursuant to statutes or regulations, which are subject to bids or applications for public contests, etc. pursuant to the former part of Article 27-6 (1) of the Act. |
[This Article Newly Inserted on Nov. 28, 2014]
[Previous Article 35-4 Moved to Article 35-5 <Nov. 28, 2014>]
| Article 35-6 (National Projects, etc. Subject to Assessment of Impacts on Local Government Finance) |
| (1) | A written assessment of the impact on local government finance that the head of a central government agency must submit to the Minister of the Interior and Safety under the former part of Article 27-6 (2) of the Act shall include the results of assessing the duration of local financial burden, the details of the required amount and the possibility of funding. In such cases, matters necessary for detailed items, criteria, procedures, methods, etc. for assessment shall be determined by the Minister of the Interior and Safety. <Amended on Jul. 26, 2017> |
| (2) | The projects to be evaluated by the head of the central government office pursuant to the latter part of Article 27-6 (2) of the Act shall be as follows: <Amended on Sep. 26, 2023> |
| 1. | A new project, the total project cost of which is not less than 30 billion won and the amount of local government financial bearing is not less than 10 billion won; |
| 2. | A project for which the total project cost and the amount of local government financial bearing by at least 20/100 of each year. |
[This Article Newly Inserted on Nov. 28, 2014]
| Article 35-7 (Restrictions of Local Tax Reductions and Exemptions) |
| (1) | "The amount of local tax exemptions or reductions occupied by the amount of reduced and local tax exemptions or reductions below the percentage prescribed by Presidential Decree" in Article 28-2 (1) of the Act means the following amounts: <Newly Inserted on Mar. 3, 2020, Dec. 16, 2021> |
| 1. | The settlement amount of local taxes collected in the relevant year: The amount received in the settlement statement of the relevant fiscal year approved by the local council pursuant to Article 150 (1) of the Local Autonomy Act; |
| (2) | Pursuant to Article 28-2 (1) of the Act, the Minister of the Interior and Safety shall ensure that the ratio (referred to as “rate of the aggregate amount of local taxes that are non-taxable, reduced or exempt” hereafter in this Article) of the aggregate amount of local taxes that are non-taxable, reduced or exempt to the sum of local taxes collected at settlement, and local taxes that are non-taxable, reduced or exempt for the relevant year shall not exceed any ratio set forth in the following classifications for each year. In such cases, when any ratio is calculated, a fraction of less than 1/1,000 shall be deemed nil: <Amended on Mar. 23, 2013; Nov. 19, 2014; Oct. 6, 2015; Jul. 26, 2017; Mar. 3, 2020> |
| 1. | By the year 2017: 15/100; |
| 2. | The year 2018: A ratio calculated by adding 5/1,000 to a rate of the aggregate amount of local taxes that are non-taxable, reduced or exempt for the year 2017; |
| 3. | The year 2019: A ratio calculated by adding 5/1,000 to an average rate of the aggregate amount of local taxes that are non-taxable, reduced or exempt for the years from 2017 to 2018; |
| 4. | From the year 2020 on: A ratio calculated by adding 5/1,000 to an average rate of the aggregate amount of local taxes that are non-taxable, reduced or exempt for three immediately preceding years of the relevant year. |
| (3) | When calculating the rate of the aggregate amount of local taxes that are non-taxable, reduced or exempt referred to in the subparagraphs of paragraph (2), the following amounts shall not be included in local taxes that are non-taxable, reduced or exempt: <Amended on Mar. 3, 2020> |
| 2. | Deleted; <Mar. 3, 2020> |
[This Article Newly Inserted on Jan. 31, 2012]
[Moved from Article 35-4 <Nov. 28, 2014>]
| Article 36 (Types and Distribution of Grants-In-Aid for Adjustment among Sis/Guns) |
| 1. | General grants-in-aid: Grants-in-aid to meet general fiscal demands, such as supplementing funds necessary for the administration of Sis/Guns; |
| 2. | Special grants-in-aid: Grants-in-aid to meet specific fiscal demands, such as promoting community development projects or other policies of Sis/Guns. |
| (2) | Funds for general grants-in-aid shall be an amount equivalent to 90/100 of the total amount of grants-in-aid, and funds for special grants-in-aid shall be an amount equivalent to 10/100 of the total amount of grants-in-aid. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014> |
| (3) | In the distribution of general grants-in-aid, an amount equivalent to 50/100 of the total amount of general grants-in-aid shall be distributed in proportion to the population size of a relevant Si/Gun, an amount equivalent to 20/100 thereof shall be distributed based on the collection records of the Metropolitan City tax and Do tax of the relevant Si/Gun, an amount equivalent to 30/100 thereof shall be distributed on the basis of the value obtained by subtracting, from one, the financial independence index (referring to the value calculated by dividing the standard amount of financial revenue by the standard amount of financial demand for each year pursuant to the Local Subsidy Act) of the relevant Si/Gun among Sis/Guns in each of which the financial independence index is less than one. <Amended on Nov. 28, 2014; Aug. 29, 2016> |
| (4) | Deleted. <Apr. 29, 2016> |
| (5) | Matters concerning disbursement of general grants-in-aid including timing for distributing, and specific standards for distributing, methods for calculating, and timing for distributing special grants-in-aid shall be prescribed by municipal ordinance of a City/Do. <Amended on Nov. 28, 2014; Aug. 29, 2016> |
[Title Amended on Nov. 28, 2014]
| Article 36-2 (Grants-in-Aid for Adjustment among Autonomous Gus) |
| (1) | Funds for grants-in-aid for adjustment among autonomous Gus under Article 29-2 of the Act shall consist of money arising from the ordinary taxes under the items of Article 8 (1) 1 of the Framework Act on Local Taxes among the Special Metropolitan City tax and Metropolitan City tax, excluding the amounts classified as follows: <Amended on Mar. 3, 2020; Dec. 31, 2020; Dec. 31, 2021> |
| 2. | Metropolitan Cities: Local consumption tax distributed pursuant to Article 71 (3) 3 (a) and 4 (a) of the Local Tax Act; pro rata business place portion of resident tax under Section 3 of Chapter VII of the same Act; and employee portion of resident tax under Section 4 of the same Chapter. |
| (2) | Article 36 (2) shall apply mutatis mutandis to the structure of grants-in-aid for adjustment among autonomous Gus. In such cases, “general grants-in-aid” shall be construed as “general grants-in-aid for adjustment among autonomous Gus”, “grants-in-aid” as “grants-in-aid for adjustment among autonomous Gus”, and “special grants-in-aid” as “special grants-in-aid for adjustment among autonomous Gus,” respectively. |
| (3) | Matters necessary for the grant ratio, calculation methods, grant period, etc. of grants-in-aid shall be determined by municipal ordinance of the Special Metropolitan City or a Metropolitan City. |
[This Article Newly Inserted on Nov. 28, 2014]
| Article 37 Deleted. <Jul. 13, 2021> |
| Article 37-2 Deleted. <Jul. 13, 2021> |
| Article 37-3 Deleted. <Jul. 13, 2021> |
| Article 37-4 Deleted. <Jul. 13, 2021> |
| Article 37-5 Deleted. <Jul. 13, 2021> |
| Article 37-6 Deleted. <Jul. 13, 2021> |
| Article 37-7 Deleted. <Jul. 13, 2021> |
| Article 38 (Presentation of Opinions about Standard Burden Ratio) |
| (1) | The head of a local government that is dissatisfied with the standard burden ratio applied to his/her local government pursuant to Article 33 may present his/her opinion to the Minister of the Interior and Safety, along with necessary materials. In such cases, a Si/Gun/autonomous Gu shall present its opinion, along with the opinions of the competent Mayor/Do Governor. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| (2) | Where the Minister of the Interior and Safety recognizes that the opinion presented pursuant to paragraph (1) is deemed reasonable after comprehensively examining the financial circumstances, etc. of the relevant local government and other local governments, he/she shall adjust the standard burden ratio. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| Article 38-2 (Formulation etc. of Medium-Term Local Finance Plan) |
| (1) | When the head of a local government formulates a medium-term local finance plan under Article 33 (1) of the Act (hereinafter referred to as “medium-term local financial plan”) may listen to the public by means referred to in Article 46 (1) of the Act. |
| (2) | Where the Minister of the Interior and Safety finds that a medium-term local finance plan submitted by the head of a local government pursuant Article 33 (1) of the Act falls under any of the following, he/she may request to supplement such plan from the head of the relevant local government: <Amended on Jul. 26, 2017> |
| (3) | When the Minister of the Interior and Safety requests to supplement a medium-term local finance plan under paragraph (2), he/she shall listen to opinions of the head of the relevant local government in advance. <Amended on Jul. 26, 2017> |
| (4) | The Minister of the Interior and Safety shall notify a local government of guidelines of a medium-term local finance plan under Article 33 (4) of the Act by August 31 every year. <Amended on Jul. 26, 2017> |
[This Article Newly Inserted on Aug. 29, 2016]
| Article 39 (Scope of Mandatory Spending) |
| 2. | Expenses incurred in relation to Government-subsidized projects or projects subsidized by Cities/Dos for Sis/Guns/autonomous Gus under Article 23 (2) of the Act (including Government subsidies and subsidies that Cities/Dos provide to Sis/Guns/autonomous Gus under Article 23 (2) of the Act); |
| 3. | Interest expenses on local government bonds, loans, etc.; |
| 5. | Other expenses, the disbursement and amount of which are determined pursuant to statutes or regulations. |
[This Article Wholly Amended on Nov. 28, 2014]
| Article 40 (Scope of Expenses Operated as Off-Budget Annual Revenues and Expenditure) |
| (1) | "Grounds prescribed by Presidential Decree" in Article 34 (3) of the Act means the grounds falling under any of the following subparagraphs: |
| 1. | The burden of losses incurred for public facilities; |
| 2. | Contract guarantees, bidding guarantees, short-fall guarantees and defects liability guarantees; |
| 3. | Deposits made pursuant to other statutes; |
| 4. | Expenses that are temporarily reserved by any local government to meet the need to perform clerical work. |
| (2) | Except as otherwise provided in this Decree or other statutes or regulations, the expenses referred to in each subparagraph of paragraph (1) shall be managed as cash outside of the annual revenues and expenditures and direct expenditure thereof shall be prohibited. |
| Article 40-2 (Details of Gender-Sensitive Budgets and Standards for Preparation thereof) |
| (1) | The gender-sensitive budget referred to in Article 36-2 of the Act (hereinafter referred to as “gender-sensitive budget”) shall include the following details: <Amended on Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| 1. | Outline and scale of the gender-sensitive budget; |
| 2. | Expected effects of gender equality by the gender-sensitive budget, performance objectives thereof and benefit analysis on the gender-sensitive budget by gender; |
| 3. | Other matters prescribed by the Minister of the Interior and Safety. |
| (2) | The gender-sensitive budget shall be prepared in compliance with the standards for preparation and methods, etc. prescribed by the Minister of the Interior and Safety after consultation with the Minister of Gender Equality and Family. <Amended on Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
[This Article Newly Inserted on Sep. 6, 2011]
| Article 41 (Examination of Financial Investment Projects) |
| (1) | The head of a local government shall examine any of the following investment projects pursuant to Article 37 of the Act (hereinafter referred to as "investment examination"): Provided, That the same shall not apply to any project for disaster recovery and any other projects prescribed by Ordinance of the Ministry of the Interior and Safety: <Amended on Feb. 29, 2008; Nov. 2, 2009; Dec. 20, 2010; Sep. 6, 2011; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jun. 28, 2016; Jul. 26, 2017; Sep. 26, 2023> |
| 1. | A City/Do: Any of the following projects: |
| (a) | A new investment project, which amounts to at least four billion won for a total project cost; |
| (b) | A new investment project, which amounts to at least one billion won for a total project cost and includes any foreign loan project or foreign investment project; |
| (c) | A new investment project, which amounts to at least 500 million won for a total project cost, and is a publicity-building project; |
| (d) | A new investment project, which amounts to at least 300 million won for a total project cost, and is an event project, such as a performance or festival; |
| 2. | A Si/Gun/autonomous Gu: Any of the following projects: |
| (a) | A new investment project, which amounts to at least two billion won for a total project cost; |
| (b) | A new investment project, which amounts to at least 500 million won for a total project cost, and includes any foreign loan project or foreign investment project; |
| (c) | A new investment project, which amounts to at least 300 million won for a total project cost, and is a publicity-building project; |
| (d) | A new investment project, which amounts to at least 100 million won for a total project cost, and is an event project, such as a performance or festival. |
| (2) | Deleted. <Nov. 28, 2014> |
| (3) | Deleted. <Nov. 28, 2014> |
| (4) | The Minister of the Interior and Safety and a Mayor/Do Governor shall take measures, including training, necessary to improve the investment examination capabilities of local governments, and the Minister of the Interior and Safety or a Mayor/Do Governor may, upon the request of the head of a local government, perform the investment examination on investment projects prescribed by Ordinance of the Ministry of the Interior and Safety (including projects subject to financial bearing under any item of Article 37 (1) 2 of the Act), and present their opinions thereon. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017; Sep. 26, 2023> |
| (5) | Where the head of a local government intends to request an investment examination of an investment project, as provided in paragraph (4), on which the feasibility study under Article 37 (2) of the Act or the preliminary feasibility study under Article 38 of the National Finance Act has been conducted, he/she shall submit the results of the feasibility study or preliminary feasibility study and whether such results are reflected. In such cases, if the results of the feasibility study or preliminary feasibility study are not reflected, he/she shall specify reasons therefor. <Amended on Nov. 28, 2014> |
| (6) | Standards for conducting investment examinations and other matters necessary for conducting investment examinations shall be prescribed by Ordinance of the Ministry of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
[Title Amended on Nov. 28, 2014]
| Article 41-2 (Methods of Disclosing Major Projects) |
| (1) | Pursuant to Article 37-3 of the Act, the head of a local government shall post the following information on the website of the local government: <Amended on Sep. 26, 2023> |
| 1. | The outline of a project (including the total project cost, funds, project period, the department of project management, and the person in charge); |
| 2. | Results of investment appraisal; |
| 3. | The results of examining the issuance of local government bonds; |
| 4. | The issue of local government bonds (including the total amount of issue scheduled and the amount issued until the date of disclosure); |
| 5. | The progress rate and other implementation status of the project. |
| (2) | The disclosure under paragraph (1) shall be made as of December 31 each year. |
| (3) | The disclosure under paragraph (1) shall be continued for at least five years after the completion of each project. |
[This Article Newly Inserted on Nov. 28, 2014]
| Article 42 (Compilation of Budgets) |
The budgets of local governments shall be compiled according to the standards for compiling the budgets of local governments and the classification of their budget items provided in Articles 38 (2) and 41 of the Act, except where the provisions of other statutes or regulations prescribe otherwise.
| Article 43 Deleted. <Oct. 20, 2008> |
| Article 44 Deleted. <Nov. 28, 2014> |
| Article 45 Deleted. <Nov. 28, 2014> |
| Article 46 (Residents' Participation in Budget Process, such as Formulation of Local Budget) |
| (1) | Residents may participate in the process of budget such as the budget process under Article 39 (1) of the Act (hereafter in this Article referred to as “participatory budgeting system”) in a manner falling under any of the following subparagraphs: <Amended on Mar. 3, 2020> |
| 1. | Public hearings or informal gatherings for discussion; |
| 2. | Questionnaire surveys; |
| 3. | The public offering of projects; |
| 4. | Other means to appropriately solicit the opinions of residents, as prescribed by municipal ordinances. |
| (2) | The heads of local governments may examine the opinions of residents that are collected pursuant to paragraph (1) and compile their respective budgets by taking into account their opinions. <Amended on Mar. 3, 2020> |
| (3) | Pursuant to Article 39 (4) of the Act, the Minister of the Interior and Safety may annually evaluate the operation of the participatory budgeting system (hereafter in this Article referred to as "participatory budgeting system") under paragraph (1) of the same Article for local governments with respect to the following matters: <Newly Inserted on Mar. 3, 2020> |
| 1. | Whether the participatory budgeting organization is organized and the extent of active operation under Article 39 (2) of the Act; |
| 2. | Scope and level of actual participation of residents in the budget process; |
| 3. | Support for publicity, education, etc. of the participatory budgeting system; |
| 4. | Other matters that the Minister of the Interior and Safety deems necessary for the evaluation of the operation of the participatory budgeting system. |
| (4) | Except as provided in paragraphs (1) and (2), matters necessary for the procedures, support, etc. for residents' participation in the budget process shall be prescribed by ordinance of each local government. <Amended on Mar. 3, 2020> |
[Title Amended on Mar. 3, 2020]
| Article 47 (Classification and Establishment of Budget Items) |
| (1) | The budget items of annual revenues shall be classified into local tax revenues, non-tax revenues, local subsidy taxes, grants-in-aid, subsidies, local government bonds and the retrieval of deposit money, etc., taking into account the sources of annual revenues: Provided, That in the case of payment of amounts allocated pursuant to Article 71 (3) 3 (a) and (b) and subparagraph 4 (a) and (b) of the same paragraph of the Local Tax Act, the amounts shall be classified as local tax revenue regardless of the source of the tax revenue. <Amended on Nov. 28, 2014; Mar. 3, 2020; Jan. 5, 2021; Dec. 31, 2021> |
| (2) | The budget items of annual expenditures shall be classified into costs for general administration, public order and safety, education, culture and tourism, environmental protection, social welfare, health care, agriculture, forestry, maritime affairs and fisheries, etc., taking into account functions of the budget of annual expenditures. <Amended on Dec. 31, 2007; Jan. 5, 2021> |
| (3) | Detailed matters necessary for the classification and establishment of the budget items of annual revenues and the budget items of annual expenditures shall be prescribed by the Minister of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017> |
[Title Amended on Nov. 28, 2014]
| Article 48 (Restrictions on Spending of Reserve Funds) |
Indirect official business expenses and subsidies (excluding subsidies for emergency disaster countermeasures) shall not be earmarked in the reserve fund provided for in Article 43 of the Act. <Amended on Sep. 26, 2023>
| Article 49 (Grounds for Incurring Obligations and Amount Thereof) |
The incurring of obligations provided for in Article 44 of the Act shall require clarification of the necessary reasons therefor by matter and indicate the year during which the incurring of obligation is to be performed, the amount of obligations that are borne, the year during which the obligations are repaid and the amount repaid.
| Article 49-2 (Documents to Accompany Budget Bills) |
| 2. | A total amount table and a net amount table of account settlement of the year before the preceding year, and a total amount table and a net amount table of the estimated amount of account settlement of the preceding year’s revenues and expenditures; |
| 2-2. | A report on the estimation and analysis of the revenue budget (including matters concerning the method and basis of the estimation, and the assessment of the difference between the revenue budget for the previous year and the settlement of the revenue and expenditure, and the analysis of cause thereof); |
| 3. | The issuance and repayment record of local government bonds issued as securities and borrowings as at the end of the year before the preceding year, and an estimate of the current amount of the local government bonds issued as securities and borrowings as at the end of the preceding year and the relevant year; |
| 4. | A written statement pertaining to an annual repayment plan for local government bonds issued as securities and borrowings; |
| 4-3. | Matters concerning the results of examination by a local government finance investment appraisal committee under the former part of Article 27-6 (1) of the Act; |
| 6. | Other documents necessary for clarifying the details of budget that are prescribed by the Minister of the Interior and Safety. |
[This Article Newly Inserted on Nov. 28, 2014]
| Article 49-3 (Matters to Be Included in Outline of Conditions of Financial Management) |
| 1. | The current status of activities to issue local government bonds; |
| 2. | The current status of public-private partnership projects and the amount of financial burden; |
| 3. | The current status of local public enterprises; |
| 4. | The arrears of local tax and non-tax revenue; |
| 5. | Other matters determined by the Minister of the Interior and Safety. |
[This Article Newly Inserted on Nov. 28, 2014]
| Article 50 (Requirements for Reducing Expenditures and Increasing Revenues) |
| (1) | "Where the budget is conserved" in Article 48 (1) of the Act (hereinafter referred to as the "reduced expenditure") means where the budget has a surplus of receipts over disbursements by incurring less expenses while maintaining the previous level or a higher level than that of the performance of the official business by means of a reduction in the fixed number of regular personnel, improvements in the methods of disbursing the budget and in the system by which the budget is disbursed through voluntary efforts. |
| (2) | "Where revenues are increased" in Article 48 (1) of the Act (hereinafter referred to as "increased revenues") means a case where annual revenues are increased by means of the discovery of new sources of annual revenues or improvements in the system by which annual revenues are collected, etc. through considerable efforts. |
| Article 51 (Standards for Paying Performance Bonuses for Saved Budgets) |
| (1) | The budgetary performance bonuses on the saved expenditure under Article 48 (1) of the Act shall be paid to persons who have contributed to saving expenditure within the following limits and their payment per capita shall not exceed 20 million won: |
| 1. | Where personnel expenses are saved by means of the reduction in the number of regular personnel, reduced one-year personnel expenses; |
| 2. | Where ordinary expenses are reduced, 50 percent of the reduced ordinary expenses; |
| 3. | Where major project costs are reduced, 10 percent of the reduced costs: Provided, That the performance bonus per case shall not exceed 100 million won. |
| (2) | Where the Budgetary Performance Bonus Examination Committee established under Article 54 recognizes a substantial effect on the reduction of expenditures by extensively applying the reduction of expenditures to similar projects, other subsidiary institutions, assistant institutions and affiliated institutions, the budgetary performance bonus may be paid in addition within 30 percent of the budgetary performance bonus that is calculated pursuant to paragraph (1). In such cases, the amount paid per capita shall not exceed 26 million won, and in cases falling under paragraph (1) 3, the performance bonus per case shall not exceed 130 million won. |
| (3) | The budgetary performance bonus for increased revenues shall be paid to anyone who has contributed to increased revenues within ten percent of the increased revenues, but the performance bonus per capita shall not exceed 20 million won. |
| (4) | Where personnel expenses are saved by reducing the number of regular personnel, the head of the relevant local government may earmark the amount equivalent to reduced one-year personnel expenses, in addition to the budgetary performance bonus provided for in paragraph (1) 1, in the budget of a project that is designated by the head of the relevant subsidiary institution, the relevant assistant institution or the relevant affiliated institution (hereinafter referred to as "subsidiary institution, etc.") that is prescribed by Ordinance of the Ministry of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| Article 52 (Ex Post Facto Budgetary Measures, etc.) |
| (1) | Where budgetary performance bonuses are paid for reducing expenditures, the head of the relevant local government shall take measures to reduce the relevant expenditures when he/she allocates the budget in the fiscal year following the fiscal year during which the reduction of the expenditures accrues and he/she compiles the budget for the fiscal year following the year following the fiscal year during which the reduction of the expenditures accrues. |
| (2) | Where budgetary performance bonuses are paid from the proceeds of reduced personnel expenses following the reduction in the number of regular personnel, the relevant subsidiary institution, etc. shall be prohibited from requesting a creation of any new organization or increasing its number of regular personnel, which performs work similar to the work of the organization with the number of regular personnel that are reduced in scale and number. |
| (3) | Where the amount of reduced ordinary expenses and the reduced major project costs are paid as budgetary performance bonuses, the relevant subsidiary institution, etc. shall be prohibited from requesting a budget allocation for the cost to undertake any project similar to the project on which costs are reduced. |
| Article 53 (Provisions Governing Payment and Operation of Budgetary Performance Bonuses) |
Except as otherwise provided, in this Decree, matters necessary for the payment and operation of the budgetary performance bonuses shall be prescribed by Ordinance of the Ministry of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017>
| Article 54 (Establishment of Budgetary Performance Bonus Examination Committee) |
| (1) | Each local government shall establish the Budgetary Performance Bonus Examination Committee under the jurisdiction of its head in order to examine the payment, etc. of the budgetary performance bonuses pursuant to Article 48 (2) of the Act. |
| (2) | The Budgetary Performance Bonus Examination Committee referred to in paragraph (1) shall be comprised of not more than ten members, including one chairperson and one vice chairperson. The chairperson shall be the vice head of each local government. The vice chairperson shall be the section chief, the bureau chief or the public official in charge of budget. Its members shall be appointed or commissioned by the head of the relevant local government from among public officials who belong to the relevant local government and persons who have profound expert knowledge in the fields of budget accounting and local taxation. |
| (3) | Matters necessary for the operation, etc. of the Budgetary Performance Bonus Examination Committee shall be prescribed by Ordinance of the Ministry of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| (4) | Notwithstanding paragraphs (1) through (3), where a committee of which the features and functions are similar to the Budgetary Performance Bonus Examination Committee is established under the jurisdiction of the head of a local government, the committee may function on behalf of the Budgetary Performance Bonus Examination Committee as prescribed by the municipal ordinance of the relevant local government. <Newly Inserted on Dec. 29, 2017> |
| Article 54-2 (Monitoring by Residents Relating to Illegal Expenditure and Waste of Budget and Funds) |
| (1) | The head of each local government shall establish and operate a center for reporting a waste of budget to accept claims for corrective action against illegal expenditure of budget and funds, and proposals related to a budget saving or a revenue growth, referred to in Article 48-2 (1) and (2) of the Act, and to deal with such claims and proposals. |
| (2) | Where the head of the relevant local government deems that claims for corrective action and proposals referred to in Article 48-2 (1) and (2) of the Act fail to meet requirements, he/she may ask for additional information within a specified period. |
| (3) | Notice referred to in Article 48-2 (3) of the Act shall be given within 30 days (excluding a specified period referred to in paragraph (2)) from the date on which claims for corrective action and proposals are accepted: Provided, That if it is deemed impractical to deal with the claims or proposals within the period, a relevant person who has asked for claims for corrective action or made proposals shall be informed of reasons for such impracticality and a period required for dealing with such claims or proposals. |
| (4) | No head of the relevant local government shall reveal or imply the identity of any person asking for claims for corrective action or making proposals referred to in Article 48-2 (1) and (2) of the Act, to another person, without such person’s consent. |
| (5) | The head of the relevant local government may pay the budgetary performance bonuses referred to in Article 48 of the Act, to any persons who have made proposals related to a budget saving or a revenue growth, referred to in paragraph (1). |
| (6) | To encourage claims for corrective action and proposals under Article 48-2 (1) and (2) of the Act, the head of a local government may establish a resident monitoring organization comprised of residents, as prescribed by municipal ordinance of the relevant local government. <Newly Inserted on Dec. 31, 2018> |
[This Article Newly Inserted on Sep. 6, 2011]
| Article 54-3 (Payment of Reward for Reporting on Extravagant Budget Spending) |
| (1) | The Minister of the Interior and Safety may pay a monetary reward not exceeding 10 million won to any of the following persons: Provided, That no monetary reward shall be paid, where any reward, etc. is granted pursuant to the Regulations on Citizen Proposals or other statutes and it is deemed inappropriate to pay a monetary reward under the main clause: |
| (2) | Matters necessary for the detailed standards, methods, procedures, etc. for paying monetary rewards under paragraph (1) shall be determined by the Minister of the Interior and Safety. |
[This Article Newly Inserted on Apr. 28, 2020]
| Article 55 (Conversion of Budget) |
| (1) | In cases of the budget less the following expenses, the amount for each unit project or each item within each policy project’s budgetary limits may be converted into any other item of expenditure, pursuant to the provisions of Article 49 (1) of the Act: <Amended on Dec. 13, 2007; Sep. 6, 2011; Feb. 29, 2012; Mar. 5, 2014> |
| 1. | Personnel expenses [including basic personnel expenses under the Regulations on Administrative Organizations of Local Governments and Standards for the Prescribed Number of Their Personnel (including personnel expenses of the scope of self-regulation under the latter part of Article 4 (2) of the aforesaid Regulations) or the total amount of personnel expenses under the Regulations on Administrative Organizations of Local Educational Administrative Institutions and Standards for the Prescribed Number of Their Personnel; |
| 2. | Facility expenses and incidental expenses; |
| 3. | Repayment expenses: Provided, That the principal and interest shall be interchangeable with each other. |
| (2) | The budget conversions cannot be made after the lapse of the fiscal year and other expense items cannot be converted in order to appropriate indirect official business expenses. |
| Article 56 (Plan for Allotting Budget) |
| (1) | When the budget is enacted, the head of each local government shall develop a plan for allocating the budget, including annual revenues and expenditures, continuing expenses, the incurring of obligations and specified carryover expenses, and then allocate the monthly and quarterly budget for the secretariat of the local council, subsidiary institutions, administrative agencies and subordinate administrative agencies. |
| (2) | The plan for allotting the budget referred to in the provisions of paragraph (1) shall be developed on the basis of the plan for the monthly collection of budget for annual revenues and the plan for the monthly disbursement of budget for annual expenditures. |
| (3) | When the disbursement of reserve funds is determined, the allocation thereof shall be made from the budget of annual expenditures. |
| Article 57 (Budget Allotment Prior to Commencement of Fiscal Year) |
Where the budget of each local government is enacted, the budget for the expenses and costs falling under each of the following subparagraphs may be allocated even prior to the commencement of the fiscal year: <Amended on Dec. 31, 2007; Sep. 26, 2023>
| 1. | Expenses incurred in areas in which traffic and communication are inconvenient; |
| 3. | Expenses that are incurred abroad; |
| 4. | Expenses involved in the sailing of ships; |
| 5. | Expenses incurred to purchase refreshments in administrative agencies and subordinate administrative agencies of the local government; |
| 6. | Indirect official business expenses; |
| 7. | Public works project costs requiring early disbursement due to local economic policy; |
| 8. | Expenses for disaster recovery projects. |
| Article 58 (Carryover of Budget of Annual Expenditures) |
| (1) | "Expenses prescribed by Presidential Decree" in Article 50 (2) 2 of the Act means the following expenses: <Amended on Jun. 31, 2007; Aug. 4, 2015; Sep. 26, 2023> |
| 4. | Expenses incurred in making full recovery from disasters. |
| (2) | "Expenses prescribed by Presidential Decree" in Article 50 (2) 3 of the Act means the following expenses: <Amended on Dec. 4, 2015; Sep. 26, 2023> |
| 1. | Expenses incurred in taking reimbursement procedures or reimbursement procedures that are in progress after the completion of the survey, appraisal and assessment of land, goods, etc. that are all subject to reimbursement; |
| 2. | Expenses incurred in concluding a service contract to perform appraisal and assessment or appraisal and assessment in progress in order to pay indirect compensation for damage caused to fishing rights still in existence after the construction work is completed; |
| 3. | Expenses incurred in paying reimbursements for undertaking disaster recovery projects. |
| (3) | "Expenses prescribed by Presidential Decree" in Article 50 (2) 4 of the Act means the following expenses prescribed by the head of a local government: Provided, That expenses referred to in subparagraph 2 may be carried over only by January 10, 2016: <Amended on Dec. 4, 2015> |
| 1. | Expenses incurred in maintaining and operating institutions or facilities; |
| 2. | General compensation, rewards, or expenses transferred to the private sector. |
CHAPTER IV ACCOUNT SETTLEMENT
| Article 59 Deleted. <Nov. 29, 2016> |
| Article 59-2 Deleted. <Nov. 29, 2016> " |
| Article 59-3 Deleted. <Nov. 29, 2016> |
| Article 60 Deleted. <Nov. 29, 2016> |
| Article 61 Deleted. <Nov. 29, 2016> |
| Article 62 Deleted. <Nov. 29, 2016> |
| Article 62-2 Deleted. <Dec. 31, 2018> |
| Article 62-3 Deleted. <Nov. 29, 2016> |
| Article 63 Deleted. <Nov. 29, 2016> |
| Article 63-2 Deleted. <Nov. 29, 2016> " |
CHAPTER V FINANCIAL ANALYSIS AND PUBLICATION
| Article 64 (Reports on Financial Operation) |
| (1) | The financial reports the head of each local government must submit pursuant to Article 54 of the Act are as follows: <Amended on Sep. 6, 2011; Nov. 28, 2014; Dec. 16, 2021> |
| 8. | The report on the results of the examination of the financial investment project plan under Article 37 of the Act; |
| 13. | Other reports on important matters that are deemed necessary to formulate and appropriately administer policies for the finances of local governments. |
| (2) | The forms of financial reports, a submission deadline and other necessary matters concerning such reports shall be determined by the Minister of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017> |
| Article 65 (Financial Analysis and Financial Examination) |
| (1) | Pursuant to Article 55 (1) of the Act, the Minister of the Interior and Safety shall annually conduct analysis on financial reports (hereinafter referred to as "financial analysis") under Article 54 of the Act, which is classified into fields such as financial soundness and financial efficiency of local governments. |
| (2) | Necessary matters concerning detailed standards, procedures, methods, etc. for conducting financial analysis shall be prescribed by the Minister of the Interior and Safety. |
| (3) | The Minister of the Interior and Safety shall without delay notify the heads of local governments of matters prescribed pursuant to paragraph (2). |
| 1. | Percentage obtained by dividing the amount referred to in item (a) by the amount referred to in item (b) (hereinafter referred to as "deficit as a percentage of consolidated fiscal balance"): |
| (a) | The amount obtained by subtracting the net revenues from the net expenditures consolidated from the general accounts, special accounts and funds in the relevant year; |
| (b) | The amount obtained by adding up the net expenditures and the net loans in the relevant year; |
| 2. | Percentage obtained by dividing the aggregate amount referred to in item (a) by the amount of budget referred to in item (b) (hereinafter referred to as "debt-to-budget ratio"): |
| (b) | The amount of the final budget in the relevant year; |
| 3. | Percentage obtained by dividing the amount referred to in item (a) by the amount referred to in item (b) (hereinafter referred to as "debt service ratio"): |
| (a) | The annual average amount of the payments of debts from the net local expenditure (including the total amount to be paid to build-transfer-lease project operators from the net local expenditure) for the next four years including the relevant year; |
| (b) | The annual average revenue amount estimated from the ordinary revenue sources (referring to the aggregate amounts of local taxes excluding local education tax, ordinary nontax revenues prescribed by the Minister of the Interior and Safety, local subsidies, and coordinated grants) during the given period referred to in item (a). In such cases, the amount of revenue estimated from the ordinary revenue sources shall be calculated by applying the annual average increase rate of the ordinary revenue sources during the past four years, to the size of the ordinary revenue source in the immediately preceeding year; |
| 4. | Accumulated collection rate of local taxes on a quarterly basis in the relevant year (referring to the actual accumulated collection rate obtained by deducting the refunds due to overpayment or erroneous payment for the preceding year; hereinafter referred to as "local tax collection rate"); |
| 5. | Percentage obtained by dividing the total balance in the treasury on a quarterly basis in the relevant year by the average total balance in the treasury on the relevant quarterly basis for the last three years (hereinafter referred to as "balance in the treasury as a percentage"); |
| (6) | Where the Minister of the Interior and Safety deems necessary to examine the level of financial risk under paragraph (5), he/she may request the head of a local government to submit related data. In such cases, the head of the local government requested to submit data shall comply with such request unless there is a compelling reason not to do so. |
[This Article Wholly Amended on Dec. 31, 2018]
| Article 65-2 (Financial Diagnosis) |
| (1) | Where a local government falls under any of the following as a result of financial analysis, the Minister of the Interior and Safety shall conduct a financial diagnosis (hereinafter referred to as "financial diagnosis") under Article 55 (3) of the Act: |
| 1. | Where the debt charges as a percentage of total revenue budget exceeds the percentage prescribed by the Minister of the Interior and Safety; |
| 2. | Where the actual revenue in the settlement of accounts is significantly less than the amount of the estimated revenue; |
| 3. | Where the soundness of financial management has declined significantly due to a high ratio of budget in the category of operating expenses including labor costs; |
| 4. | Where the Minister of the Interior and Safety deems financial diagnosis necessary for a significant decline in financial soundness, efficiency, etc., as a result of financial analysis; |
| (2) | "Local governments of which level of financial risk is higher than the level designated by Presidential Decree" in Article 55 (3) 2 of the Act means local governments falling under any of the following: |
| 1. | A local government in which case a deficit as a percentage of consolidated fiscal balance exceeds 25/100; |
| 2. | A local government in which case the debt-to-budget ratio exceeds 25/100; |
| 3. | A local government in which case the debt service ratio exceeds 12/100; |
| 4. | A local government in which case the local tax collection rate is less than 80/100 |
| 5. | A local government in which case the balance in the treasury is less than 20/100; |
| 6. | A local government in which case the debt ratio of public enterprises exceeds 400/100. |
| (3) | Where the Minister of the Interior and Safety conducts a financial diagnosis, he/she shall comprehensively diagnose the financial situation or transition process, etc. of the relevant local government, including matters provided for in the subparagraphs of Article 65 (4). |
| (4) | Where the Minister of the Interior and Safety deems necessary to conduct a financial diagnosis, he/she may request the head of a local government to submit related data. In such cases, the head of the local government requested to submit data shall comply with such request unless there is a compelling reason not to do so. |
| (5) | "Specialized institution prescribed by Presidential Decree" in Article 55 (6) of the Act means an institution or organization falling under any of the following: |
| 1. | The Korea Research Institute for Local Administration under the Korea Research Institute for Local Administration Support Act; |
| 2. | Other institutions or organizations that the Minister of the Interior and Safety designates and publicly notify, deeming that they specialize in the field of financial analysis and financial diagnosis. |
[This Article Wholly Amended on Dec. 31, 2018]
| Article 65-3 (Criteria and Procedures for Designation of Local Governments in Financial Crisis and for Revocation of Designation Thereof) |
| (1) | The Minister of the Interior and Safety may designate a local government with its financial risk deemed serious, which falls under the following, as a local government in financial crisis referred to in Article 55-2 (1) 1 of the Act, following deliberation by the Local Financial Crisis Management Committee under Article 56 of the Act (hereinafter referred to as the "Local Financial Crisis Management Committee"): |
| 1. | A local government in which case a deficit as a percentage of consolidated fiscal balance exceeds 30/100; |
| 2. | A local government in which case the debt-to-budget ratio exceeds 40/100; |
| 3. | A local government in which case the debt service ratio exceeds 17/100; |
| 4. | A local government in which case the local tax collection rate is less than 70/100; |
| 5. | A local government in which case the balance in the treasury as a percentage is less than 10/100; |
| 6. | A local government in which case the debt ratio of public enterprises exceeds 600/100. |
| (2) | The Minister of the Interior and Safety may designate a local government falling under the following pursuant to Article 55-2 (1) 2 of the Act of which the financial risk level is deemed non-serious but the financial soundness or efficiency, etc. is deemed to have declined significantly as a local government requiring financial caution, following deliberation by the Local Financial Crisis Management Committee: |
| 1. | A local government in which case a deficit as a percentage of consolidated fiscal balance is more than 25/100 and not more than 30/100; |
| 2. | A local government in which case the debt-to-budget ratio is more than 25/100 and not more than 40/100; |
| 3. | A local government in which case the debt service ratio is more than 12/100 and not more than 17/100; |
| 4. | A local government in which case the local tax collection rate is not less than 70/100 and less than 80/100; |
| 5. | A local government in which case the balance in the treasury as a percentage is not less than 10/100 and less than 20/100; |
| 6. | A local government in which case the debt ratio of public enterprises is more than 400/100 and not more than 600/100. |
| (3) | Where the Minister of the Interior and Safety intends to designate a local government in financial crisis or a local government requiring financial caution pursuant to Article 55-2 (1) of the Act or to revoke the designation thereof pursuant to Article 55-2 (2) of the Act, he/she may conduct a written-analysis, an on-site inspection, etc. where necessary. |
[This Article Newly Inserted on Dec. 31, 2018]
[Previous Article 65-3 moved to Article 65-4 <Dec. 31, 2018>]
| Article 65-4 (Submission Deadline for Plans for Financial Soundness) |
| (1) | The head of a local government designated as a local government in financial crisis pursuant to Article 55-2 (1) 1 of the Act (hereinafter referred to as “head of a local government in financial crisis”) shall establish a plan for improving financial soundness pursuant to Article 55-3 (1) of the Act (hereinafter referred to as “plan for financial soundness”) within 60 days from the date on which the local government is designated as a local government in financial crisis, and then shall submit the plan to the Minister of the Interior and Safety. <Amended on Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017; Dec. 31, 2018> |
| (2) | Details of each plan for financial soundness shall include organizational restructuring, payments of debts, an increase in revenue, restrictions on new projects and other matters prescribed by the Minister of the Interior and Safety. <Newly Inserted on Dec. 31, 2018> |
| (3) | After obtaining approval by the Minister of the Interior and Safety pursuant to Article 55-3 (1) of the Act, the head of a local government in financial crisis shall, without delay, forward a plan for financial soundness to the relevant local council and request the local council to pass a resolution on the plan. <Amended on Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017; Dec. 31, 2018> |
| (4) | Where the head of a local government in financial crisis intends to revise a plan for financial soundness, he/she shall submit the plan to the relevant local council for resolution after obtaining approval from the Minister of the Interior and Safety. <Amended on Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017; Dec. 31, 2018> |
| (5) | The Minister of the Interior and Safety may evaluate the results of the implementation of a plan for financial soundness of the relevant local government in order to instruct it on matters necessary for financial soundness pursuant to Article 55-3 (5) of the Act. <Newly Inserted on Dec. 31, 2018> |
[This Article Newly Inserted on Sep. 6, 2011]
[Moved from Article 65-3; previous Article 65-4 moved to Article 65-5 <Dec. 31, 2018>]
| Article 65-5 (Restrictions on Compiling Budgets for Financial Investment Projects) |
“Projects requiring public investment in excess of the scale prescribed by Presidential Decree” in Article 55-4 (2) of the Act means financial investment projects classified below: <Amended on Nov. 28, 2014> | 1. | A City/Do: A new investment project, the total project cost of which is at least four billion won; |
| 2. | A Si/Gun/autonomous Gu: A new investment project, the total project cost of which is at least two billion won. |
[This Article Newly Inserted on Sep. 6, 2011]
[Moved from Article 65-2 <Dec. 31, 2018>]
| Article 66 (Organization and Operation of Committee for Management of Local Government Financial Crisis) |
| (1) | The chairperson (hereafter in this Article referred to as the "Chairperson") of the Local Financial Crisis Management Committee shall convene and preside over meetings of the Local Financial Crisis Management Committee. <Amended on Dec. 31, 2018> |
| (2) | Where the Chairperson is unable to perform his/her duties due to any unavoidable cause, a member designated in advance by him/her shall act on behalf of the Chairperson. |
| (3) | "Related administrative agencies prescribed by Presidential Decree, such as the Ministry of Economy and Finance, the Ministry of the Interior and Safety, and the Office for Government Policy Coordination" in Article 56 (3) 1 of the Act means the Ministry of Economy and Finance, the Ministry of the Interior and Safety, the Office for Government Policy Coordination, and central administrative agencies designated by the Chairperson, which are related to items on the agenda. <Amended on Jul. 26, 2017> |
| (4) | The Local Financial Crisis Management Committee shall hold meetings when a majority of its incumbent members attends and passes resolutions by an affirmative vote of a majority of those present. |
| (5) | Where necessary for deliberation, the Chairperson may request related agencies to submit necessary data or opinions, or require related public officials or non-governmental experts to attend meetings of the Local Financial Crisis Management Committee to hear their opinions. |
| (6) | One administrative secretary shall be assigned to the Local Financial Crisis Management Committee, and the Minister of the Interior and Safety shall appoint the administrative secretary from among members of the Senior Executive Service of the Ministry of the Interior and Safety. <Amended on Jul. 26, 2017> |
| (7) | Where a member recommended pursuant to Article 56 (3) 2 of the Act falls under any of the following, the Governors Association of Korea, the National Association of Mayors, the Association of Chairpersons of Metropolitan and Provincial Councils, or the National Association of Chairpersons of Municipal Councils may withdraw its recommendation: |
| 1. | Where the member becomes unable to perform his/her duties due to physical or mental disorders; |
| 2. | Where the member engages in misconduct in relation to his/her duties; |
| 3. | Where the member is deemed to be in office as member on the grounds of neglect of duty or loss of dignity, or for other reasons; |
| 4. | Where the member personally makes it clear that it is impracticable to perform his/her duties. |
| (8) | Where a member appointed pursuant to Article 56 (3) 3 of the Act falls under any subparagraph of paragraph (7), the Minister of the Interior and Safety may dismiss the relevant member. <Amended on Jul.26, 2017> |
| (9) | Except as provided in paragraphs (1) through (8), matters necessary for the composition and operation of the Local Financial Crisis Management Committee shall be prescribed by the Minister of the Interior and Safety. <Amended on Jul.26, 2017> |
[This Article Wholly Amended on Jun. 28, 2016]
| Article 66-2 (Composition and Operation of Working Committee for Local Financial Crisis Management) |
| (1) | The working committee (hereafter in this Article referred to as the "Working Committee for Local Financial Crisis Management”) established under Article 56 (6) of the Act shall be comprised of up to 15 members, including one chairperson, in consideration of gender composition. |
| (2) | The following persons shall serve as members of the Working Committee for Local Financial Crisis Management: <Amended on Jul.26, 2017> |
| 1. | Persons appointed by the Minister of the Interior and Safety from among members of the Senior Executive Service of the Ministry of the Interior and Safety; |
| 2. | One person each recommended by the Governors Association of Korea, the National Association of Mayors, the Association of Metropolitan and Provincial Council Chairs, and the National Association of Local Council Chairmen; |
| 3. | Other persons appointed by the Minister of the Interior and Safety with extensive knowledge about, and experience in, local public finance. |
| (3) | The Minister of the Interior and Safety shall appoint the chairperson of the Working Committee for Local Financial Crisis Management from among members appointed or recommended under paragraph (2). <Amended on Jul.26, 2017> |
| (4) | One administrative secretary shall be assigned to the Working Committee for Local Financial Crisis Management, and the Minister of the Interior and Safety shall appoint the administrative secretary from among public officials of at least Grade IV under the jurisdiction of the Ministry of the Interior and Safety. <Amended on Jul.26, 2017> |
| (5) | The term of office of members under paragraph (2) 2 and 3 shall be two years, and they may serve a second consecutive term only. |
| (6) | The Working Committee for Local Financial Crisis Management shall review the following matters: |
| 1. | Matters concerning items on the agenda to be discussed by the Local Financial Crisis Management Committee; |
| 2. | Matters to be examined, as required by the Local Financial Crisis Management Committee; |
| 3. | Other matters necessary for the operation of the Working Committee for Local Financial Crisis Management. |
| (7) | Article 66 (1), (2), (4), and (5) shall apply mutatis mutandis to the operation of the Working Committee for Local Financial Crisis Management. In such cases, the "Local Financial Crisis Management Committee" shall be deemed the "Working Committee for Local Financial Crisis Management." |
| (8) | Article 66 (7) shall apply mutatis mutandis to the withdrawal of the recommendation of a member under paragraph (2) 2 among members of the Working Committee for Local Financial Crisis Management, and Article 66 (8) to the dismissal of a member appointed pursuant to paragraph (2) 3 among members of the Working Committee for Local Financial Crisis Management, respectively. |
| (9) | Except as provided in paragraphs (1) through (8), matters necessary to organize and operate the Working Committee for Local Financial Crisis Management shall be prescribed by the Minister of the Interior and Safety. <Amended on Jul.26, 2017> |
[This Article Newly Inserted on Jun. 28, 2016]
| Article 67 (Publication of Consolidated Financial Information) |
The Minister of the Interior and Safety may comprehensively analyze the consolidated financial information that is prepared and submitted by the head of each local government pursuant to Article 59 of the Act and publish the result of such comprehensive analysis at least once annually. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017>
| Article 68 (Methods of Publication of Operational Status of Local Government Finance) |
| (1) | Where the heads of local governments publish the current operational status of their finances pursuant to Article 60 of the Act, they shall classify the publication into the publication of the general operational status of the finances (hereinafter referred to as "common publication") and the publication of the special operational status of the finances (hereinafter referred to as "special publication") of the relevant local government. |
| (2) | The matters subject to common publication are as follows: <Amended on Feb. 29, 2008; Sep. 6, 2011; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017; Dec. 31, 2018; Sep. 26, 2023> |
| 3. | Financial analysis and financial diagnosis; |
| 4. | The results of audits conducted by the Board of Audit and Inspection and other audit institutions; |
| 5. | Other matters concerning the general operation of the finances prescribed by the Minister of the Interior and Safety, as deemed necessary to be published to residents. |
| (3) | The matters subject to special publication shall be prescribed by the local government finance public announcement deliberative committee under Article 60 (3) of the Act. <Amended on Nov. 28, 2014> |
| (4) | Deleted. <Apr. 28, 2014> |
| (5) | Except as provided in paragraphs (1) through (3), matters necessary for the forms and methods of preparing publication shall be determined by the Minister of the Interior and Safety. <Amended on Feb. 29, 2008; Mar. 23, 2013; Nov. 19, 2014; Nov. 28, 2014; Jul. 26, 2017> |
[Title Amended on Nov. 28, 2014]
CHAPTER V-2 EMERGENCY FINANCIAL MANAGEMENT
| Article 69 (Designation, and Removal of Designation of, Organization Subject to Emergency Financial Management) |
| (1) | "Where the level of financial crisis ... worsens below the level prescribed by Presidential Decree" in Article 60-3 (1) 1 of the Act means any of the following cases: |
| 1. | Where a percentage of the consolidated financial deficit is at least 45/100; |
| 2. | Where the total of the amount a local government owes and the amount of assuming debt obligations under Article 44 of the Act, among the amount of municipal bonds issued under Article 11 of the Act and the amount of assuming guaranteed debt obligations under Article 13 of the Act, is at least 60/100 of the final budget for the relevant year; |
| 3. | Where the average of the amounts of repaid debts incurred on the net local expenses for the last four years and for four years in the future based on the relevant year is at least 255/1,000 of the average amount of general revenues (referring to the total amount of local taxes, non-tax revenue, and grants-in-aid for adjustment excluding local education taxes). In such cases, the amount of general revenues for four years in the future shall be calculated by applying the rate of average increase in general revenues for the last four years to the size of general revenues in the immediately preceding year; |
| 4. | Where the accumulated amount of local taxes collected quarterly in the relevant year (referring to the actual accumulated amount of local taxes collected after deducting refunds of overpayments or erroneous payments of local taxes) is the negative value, and the absolute value thereof is at least 50/100 of the absolute value of the accumulated amount of average local tax collected in the relevant quarter for the last three years; |
| 5. | Where the total remainder in the depository in each quarter of the relevant year does not exceed 5/100 of the average total remainder in the depository in each quarter of the relevant year for the last three years; |
| (2) | Where the Minister of the Interior and Safety intends to designate an organization subject to emergency financial management (hereinafter referred to as "organization subject to emergency financial management") under Article 60-3 of the Act or remove the designation thereof, he/she may conduct analysis of documents, on-site inspections, etc. to judge the level of the financial crisis. <Amended on Jul. 26, 2017> |
[This Article Newly Inserted on Jun. 28, 2016]
| Article 70 (Dispatch of Emergency Financial Manager) |
| (1) | Where the Minister of the Interior and Safety appoints a public official belonging to a government agency as emergency financial manager (hereinafter referred to as "emergency financial manager") under Article 60-4 (1) of the Act, he/she shall appoint the emergency financial manager from among members of the Senior Executive Service. <Amended on Jul. 26, 2017> |
| (2) | Where the Minister of the Interior and Safety appoints and dispatches a person, who is not a public official belonging to a government agency, as emergency financial manager, he/she shall decide remuneration of the emergency financial manager following deliberation by the Local Financial Crisis Management Committee. <Amended on Jul. 26, 2017> |
| (3) | The Minister of the Interior and Safety shall pay remuneration of an emergency financial manager decided pursuant to paragraph (2): Provided, That, where the head of a local government applies for the designation of an organization subject to emergency financial management pursuant to Article 60-3 (2) of the Act, the local government shall pay remuneration decided pursuant to paragraph (2). <Amended on Jul. 26, 2017> |
| (4) | The period of dispatch of an emergency financial manager shall be one year from the date of dispatch, and may be extended in consideration of the period of implementation and the conditions of the implementation of an emergency financial management plan under Article 60-5 of the Act. In such cases, the Minister of the Interior and Safety shall decide whether to extend the period of dispatch of an emergency financial manager and the extended period following deliberation by the Local Financial Crisis Management Committee. <Amended on Jul. 26, 2017> |
| (5) | In any of the following cases, the Minister of the Interior and Safety may dismiss an emergency financial manager following deliberation by the Local Financial Crisis Management Committee: <Amended on Jul. 26, 2017> |
| 1. | Where the designation of an organization subject to emergency financial management is removed pursuant to Article 60-3 (5) of the Act; |
| 2. | Where the emergency financial manager becomes unable to perform his/her duties due to physical or mental disorders; |
| 3. | Where the emergency financial manager engages in misconduct in relation to his/her duties; |
| 4. | Where the emergency financial manager is deemed unfit to be in office as emergency financial manager on the grounds of neglect of his/her duties, or loss of dignity, or for other reasons; |
| 5. | Where the emergency financial manager personally makes it clear that it is impracticable to perform his/her duties. |
| (6) | Where the Minister of the Interior and Safety deems it necessary for the affairs of an emergency financial manager, he/she may request a local government, which is not an organization subject to emergency financial management, to provide personnel support. <Amended on Jul. 26, 2017> |
[This Article Newly Inserted on Jun. 28, 2016]
| Article 71 (Standards, Procedures, etc. for Establishment of Emergency Financial Management Plan) |
| (1) | A local government shall submit an emergency financial management plan established under Article 60-5 (1), with the exception of its subparagraphs, of the Act to the Minister of the Interior and Safety within 60 days (where an emergency financial manager directly establishes an emergency financial management plan, referring to 60 days from the date he/she is dispatched to an organization subject to emergency financial management) from the date of designation as an organization subject to emergency financial management. <Amended on Jul. 26, 2017> |
| 1. | Where the head of a local government at the time the local government is designated as an organization under financial crisis is the same person as the head of a local government at the time the local government is designated as an organization subject to emergency financial management; |
| 2. | Where the head of a local government applies for the designation of an organization subject to emergency financial management pursuant to Article 60-3 (2) of the Act; |
| 3. | Where the head of an organization subject to emergency financial management requires an emergency financial manager to establish an emergency financial management plan. |
| (3) | Where an emergency financial manager establishes an emergency financial management plan pursuant to the proviso to Article 60-5 (1), with the exception of its subparagraphs, of the Act, the head of an organization subject to emergency financial management and employees of the organization subject to emergency financial management shall provide cooperation in the establishment of the emergency financial management plan. |
| 1. | Goals and the period of implementation of an emergency financial management plan; |
| 2. | Matters referred to in the subparagraphs of Article 87-3 (1) of the Act (referring to matters based on the date a local government is designated as an organization subject to emergency financial management); |
| 3. | A plan for reduction in the prescribed number of public officials (including executive officers and employees of local public enterprises) and reorganization; |
| 4. | Matters concerning the issuance of municipal bonds, guarantee of debts, temporary borrowing, and assuming debt obligations under Article 60-8 (1) of the Act; |
[This Article Newly Inserted on Jun. 28, 2016]
| Article 72 (Evaluation of Implementation of Emergency Financial Management Plan) |
In order to ensure the objectivity and professionalism of the evaluation of the conditions of the implementation of an emergency financial management plan under Article 60-6 (4) of the Act, the Minister of the Interior and Safety may entrust a related specialized institution with the evaluation thereof. <Amended on Jul. 26, 2017> [This Article Newly Inserted on Jun. 28, 2016]
| Article 72-2 (Restrictions on Compilation of Budget for Financial Investment Projects) |
"Financial investment project larger than the size prescribed by Presidential Decree" in Article 60-8 (2) of the Act means a financial investment project under the following classification: | 1. | In cases of a City/Do: A new investment project, the total project cost of which is at least two billion won; |
| 2. | In cases of a Si/Gun/autonomous Gu: A new investment project, the total project cost of which is at least one billion won. |
[This Article Newly Inserted on Jun. 28, 2016]
CHAPTER VI REVENUES Deleted.
| Article 73 Deleted. <Nov. 29, 2016> |
| Article 74 Deleted. <Nov. 29, 2016> |
| Article 75 Deleted. <Nov. 29, 2016> |
| Article 76 Deleted. <Nov. 29, 2016> |
| Article 77 Deleted. <Nov. 29, 2016> |
| Article 78 Deleted. <Nov. 29, 2016> |
| Article 79 Deleted. <Nov. 29, 2016> |
| Article 80 Deleted. <Nov. 29, 2016> |
| Article 81 Deleted. <Nov. 29, 2016> |
| Article 82 Deleted. <Nov. 29, 2016> |
| Article 83 Deleted. <Nov. 29, 2016> |
| Article 84 Deleted. <Nov. 29, 2016> |
| Article 84-2 Deleted. <Nov. 29, 2016> " |
| Article 85 (Redistribution of Budget) |
| (1) | Where any public official commissioned to perform the clerical work involving the incurring of expenditures under Article 29 (1) of the Local Accounting Act, recommissions such clerical work, the head of the relevant local government shall develop a plan for redistributing the budget of annual expenditures by the financier who is recommissioned within the scope of the allocated budget of annual expenditures and redistribute the budget of annual expenditures according to such plan. <Amended on Nov. 28, 2014; Sep. 26, 2023> |
| (2) | When it is deemed necessary for budget spending, the head of each local government may change the plan for redistributing the budget of annual expenditures, which is developed pursuant to paragraph (1). |
| (3) | When any financier who is recommissioned to incur expenditures under paragraph (1) incurs expenditures, such expenditures shall not exceed the scope of the redistributed budget of annual expenditures. <Amended on Nov. 28, 2014> |
| Article 86 Deleted. <Nov. 29, 2016> |
| Article 87 Deleted. <Nov. 29, 2016> |
| Article 88 Deleted. <Nov. 29, 2016> |
| Article 89 Deleted. <Nov. 29, 2016> |
| Article 89-2 Deleted. <Nov. 28, 2014> " |
| Article 90 Deleted. <Nov. 29, 2016> |
| Article 90-2 Deleted. <Nov. 29, 2016> " |
| Article 91 Deleted. <Nov. 29, 2016> |
| Article 92 Deleted. <Nov. 29, 2016> |
| Article 93 Deleted. <Nov. 29, 2016> |
| Article 94 Deleted. <Nov. 29, 2016> |
| Article 95 Deleted. <Nov. 29, 2016> |
| Article 96 Deleted. <Nov. 29, 2016> |
| Article 97 Deleted. <Nov. 29, 2016> |
| Article 98 Deleted. <Nov. 28, 2014> |
| Article 99 Deleted. <Nov. 28, 2014> |
| Article 100 Deleted. <Nov. 29, 2016> |
| Article 101 Deleted. <Nov. 29, 2016> |
| Article 102 Deleted. <Nov. 29, 2016> |
| Article 103 Deleted. <Nov. 29, 2016> |
| Article 103-2 Deleted. <Nov. 29, 2016> " |
| Article 104 Deleted. <Nov. 29, 2016> |
| Article 105 Deleted. <Nov. 29, 2016> |
| Article 106 Deleted. <Nov. 29, 2016> |
CHAPTER IX CLAIMS AND OBLIGATIONS
| Article 107 (Definition of Clerical Work Involving Management of Claims) |
"Clerical affairs concerning management of claims" in Article 87 (1) of the Act means clerical affairs not falling under any of the following subparagraphs from among the clerical work involving preservation, collection, changes in details and extinguishment, which must be performed as the creditor of claims of the local government: <Amended on Sep. 26, 2023> | 2. | Clerical affairs performed by anyone who is in charge of taking dispositions on defaults pursuant to the provisions of statutes or regulations; |
| 3. | Clerical affairs concerning accepting the fulfillment of obligations; |
| 4. | Clerical affairs concerning the custody of cash or goods. |
| Article 108 (Scope of Clerical Affairs Involving Debt Management) |
The scope of obligations and other debts of local governments, which must be managed under Article 87-2 (1) of the Act, shall be as follows: <Amended on Nov. 28, 2014; Jul. 26, 2017; Jan. 5, 2021> | 1. | Local government bonds issued as securities; |
| 3. | Incurring of obligations; |
| 4. | Incurring of guaranteed obligations; |
| 5. | Retirement benefit liabilities; |
| 6. | Long-term deposits received; |
| 7. | Long-term unearned revenues (referring to revenues for which the consideration has been earned, but the revenue is attributable more than one year from the end of the period); |
| 8. | Other obligations and debts determined by the Minister of the Interior and Safety. |
[Title Amended on Nov. 28, 2014]
| Article 109 (Exclusion from Applicability) |
The provisions of Articles 110 through 133 shall not apply to the claims falling under any of the following subparagraphs: | 1. | Administrative fines and claims similar thereto; |
| 2. | Claims on local taxes, additional charges and dispositions on default; |
| 3. | Claims in the form of securities; |
| 4. | Claims on deposits in the depository of any local government; |
| 5. | Claims on deposits made by any treasurer in charge of ordinary expenses and any treasurer in charge of receiving and disbursing cash, other than annual revenues and expenditure; |
| 6. | Claims aimed at paying money that is to become cash-on-hand; |
| 7. | Claims on subsidies or contributions; |
| 8. | Claims for which any foreign country or any international organization is a debtor; |
| 9. | Claims on ambassadors, diplomatic ministers, diplomats or persons corresponding thereto of any foreign country. |
| Article 110 (Report on Accrual or Reversion of Claims) |
In cases falling under each of the following subparagraphs, anyone who falls under any of the following subparagraphs shall report without delay the accrual of claims or the reversion of claims to any local government to the head of such local government:
| 1. | Where anyone who intends to conclude any contract or to perform any act, either of which incurs the claims of any local government or the reversion of claims to any local government, concludes such contract or performs such act pursuant to statutes or regulations, municipal ordinances or rules: Provided, That in the accrual or the reversion of the claims, when the condition for suspension or timing therefor is set, the fulfillment of such condition and the arrival of such time mean the accrual or reversion of the claims; |
| 2. | Where anyone who is in charge of performing acts of incurring expenditures for any local government pursuant to the provisions of statutes or regulations, municipal ordinances or rules is aware of the accrual of claims to any amount refunded as a result of the act of incurring expenditures; |
| 3. | Except for cases falling under subparagraphs 1 and 2, where anyone who concludes a contract for any local government pursuant to the provisions of statutes or regulations, municipal ordinances or rules is aware of the accrual of claims under the relevant contract or the reversion of such claims to the relevant local government; |
| 4. | Except for cases falling under subparagraphs 1 through 3, where the treasurer in charge of cash or goods, or anyone who performs clerical work involving public property is aware of the accrual of claims on the property for which he/she is responsible. |
| Article 111 (Payment Notices) |
| (1) | The head of each local government shall serve a payment notice, claiming the fulfillment of obligations by 15 days before the deadline for meeting the relevant claims. |
| (2) | When the head of each local government intends to serve the payment notice referred to in the provisions of paragraph (1), he/she shall ascertain whether the amount of the relevant claims, the period during which the claims are met and the details of the claims are in conformity with statutes or regulations or the contract. |
| (3) | The provisions of paragraphs (1) and (2) shall not apply to any claim that is paid after a report is made thereon. |
| Article 112 (Serving of Demand Notice) |
| (1) | Where all or a part of the claims are not met after the lapse of the deadline set by the payment notice provided for in the provisions Article 111 (with respect to any claim that does not require the payment notice, referring to the period during which such claim is met), the head of the relevant local government shall serve a notice demanding the person concerned to meet the claims in question: Provided, That where the deadline for meeting the claims provided for in the provisions of Article 124 is extended or the deadline for meeting the claims is extended on the grounds of compromise provided for in the provisions of Article 129, a demand notice shall be served after the expiration of the extended period. |
| (2) | The demand notice referred to in the provisions of paragraph (1) shall be served within 15 days after the lapse of the payment deadline and the payment deadline in the demand notice (hereinafter referred to as the "demand deadline") shall be set to a time of not more than 15 days from the date on which the demand notice is served. |
| Article 113 (Claim Filed for Compulsory Fulfillment of Claims) |
With respect to any claims whose deadline lapses, where all or a part of such claims are not met after the demand deadline lapses after the demand notice is served pursuant to the provisions of Article 112, the heads of the relevant local governments shall take the relevant measures according to the following classifications: | 1. | With respect to secured claims (including claims guaranteed by a guarantor; hereinafter the same shall apply), the disposal and the auction of the security, implementation of the procedures for exercising security rights or any claim filed against the guarantor for him/her to fulfill his/her guarantee obligations; |
| 2. | With respect to the claims with title, the implementation of procedures for execution; |
| 3. | With respect to claims that do not fall under subparagraphs 1 and 2, claims filed to meet the claims in question by means of litigation procedures. |
| Article 114 (Shortening of Deadline for Meeting Claims) |
When grounds arise that make it possible to shorten the deadline for meeting claims, the head of the relevant local government shall, without delay, take the measures provided for in the provisions of Article 111: Provided, That the same shall not apply to cases where the deadline may be extended pursuant to the provisions of any subparagraph of Article 124 (1).
| Article 115 (Report on Claims) |
When any local government becomes aware of the accrual of the grounds falling under any of the following subparagraphs and where such local government can demand dividends and report the claims in the capacity of a creditor pursuant to statutes or regulations, municipal ordinances, or rules, the head of the relevant local government shall immediately take measures therefor:
| 1. | When the debtor is subject to enforcement procedures; |
| 2. | When the debtor is subject to a disposition on default on taxes and public levies; |
| 3. | When the debtor's property is put up for auction; |
| 4. | When the debtor is declared bankrupt; |
| 5. | When procedures commence for exercising the security right against the debtor's property; |
| 6. | When a corporate debtor is dissolved; |
| 7. | When the inheritance commences on the debtor and the inheritor makes a qualified acceptance; |
| 8. | When the liquidation of all of the debtor's property has commenced except in the cases provided for in the provisions of subparagraphs 4 through 7. |
| Article 116 (Other Measures for Preservation) |
| (1) | When it is deemed necessary to preserve their claims, the heads of local governments shall require the debtor for security, a guarantee offered by a guarantor, the furnishing of additional security, a change in the guarantor and other necessary matters under the conditions prescribed by statutes or regulations, municipal ordinances, rules or contract. |
| (2) | When it is deemed necessary to preserve their claims, the heads of local governments shall each file an application for the provisional seizure thereof or the provisional disposition thereon. |
| (3) | Where it is deemed necessary to preserve the claims, and any local government may exercise a right that is held by the debtor as a creditor pursuant to the provisions of statutes or regulations, municipal ordinances or rules, the head of the local government shall take measures necessary to exercise the relevant right in lieu of the debtor. |
| (4) | Where the head of any local government becomes aware that an act is performed by the debtor with the aim of undermining the interests of his/her local government with respect to its claims and when the local government is entitled to request to have the act set aside pursuant to the provisions of statutes or regulations, municipal ordinances and rules as a creditor, the head of the relevant local government shall file a claim, without delay, with the court to have such act set aside. |
| (5) | When the head of any local government deems that his/her claim is likely to be extinguished on the grounds of its prescription, he/she shall take necessary measures, including filing a claim for a trial, etc. with the aim of suspending such prescription. |
| Article 117 (Preservation of Security) |
When a security is furnished for its claims, the head of each local government shall promptly register and perform the registration of the establishment of a security right and meet the requirements that make it possible for his/her local government to counter any third person.
| Article 118 (Preservation of Security and Material Evidence, etc.) |
The heads of local governments shall upgrade and preserve secured properties that they must occupy as creditors (including goods that are received by exercising rights of subrogation, which belong to the debtor), claims, documents necessary to verify the matters concerning the security of their claims and other goods with duties of due care as good managers.
| Article 119 (Discontinuation of Collection) |
| (1) | When the claims are not fully met after the demand notices therefor are served (excluding any claims collected according to the precedent of a disposition taken to collect local taxes or local taxes in arrears) and fall under any of the following subparagraphs and it is deemed inappropriate to have such claims met, the heads of local governments may reorganize such claims after concluding that the clerical work involving the collection of the relevant claims (excluding the clerical work provided for in the provisions of Article 118) is no longer required with the exception of secured claims: |
| 1. | Where a corporate debtor discontinues its business, it is impossible for the debtor to resume its business in the future and it is recognized that the value of the seizable property does not exceed the expenses to be incurred in execution (excluding cases where any third person who is liable to meet the claims of the relevant corporation is not in the situation referred to in the provisions of subparagraph 2); |
| 2. | Where the debtor's whereabouts are unknown and the value of the seizable property is deemed not to exceed the expenses of execution and any other case similar thereto; |
| 3. | Where the amount of claims is so small that the amount of such claims falls short of the expenses to be incurred in their collection. |
| (2) | When the heads of local governments intend to discontinue the collection referred to in the provisions of paragraph (1), they shall ask the tax office, etc. to inspect and confirm whether the property of the relevant debtor exists: Provided, That the same shall not apply to cases where the amount of the claims falls short of 100,000 won. |
| (3) | Where it is deemed inappropriate to continue taking the measures referred to in the provisions of paragraph (1) after taking the measures on the grounds of a change in circumstances, etc., the head of the relevant local governments shall discontinue such measures. |
Any offset of claims under statutes or regulations, municipal ordinance, or rules shall be offset or appropriated under Article 65 of the Presidential Decree of Local Accounting Act. <by Nov. 29, 2016> [This Article Wholly Amended on May 29, 2016]
| Article 121 (Report on Extinguishment) |
When collection officers, persons in charge of repaying the obligations of their local governments pursuant to the provisions of statutes or regulations, municipal ordinances or rules, or persons who fall under any subparagraph of Article 110 become aware of the extinguishment of the claims while performing their respective clerical affairs, they shall report the fact, without delay, to the heads of relevant local governments.
| Article 122 (Reorganization of Claims Deemed Extinguished) |
Where claims entered in the book fall under any of the following subparagraphs, the heads of local governments shall deem that the whole or part of such claims are extinguished, reorganize them, and then enter the fact in the book: <Amended on Dec. 29, 2017>
| 1. | Where the extinctive prescription of the relevant claims expires; |
| 2. | Where the liquidation procedures for the corporate debtor are completed; |
| 3. | Where the debtor dies and a qualified acceptance is made for his/her obligations and it is recognized that the value of the inherited property does not exceed the expenses necessary for the execution and the total amount of preferential repayment claims; |
| 4. | Where the amount of the claims on the same debtor does not exceed the expenses necessary to serve the payment notice or the payment slip; |
| 5. | Where the head of a local government exempts a debtor from his/her claims under Article 130. |
| Article 123 (Setting Deadline for Meeting Claims) |
| (1) | The deadline for meeting claims shall be clearly set. |
| (2) | In the case of paragraph (1), when it is deemed advantageous for meeting the claims, the deadline may be set for paying the amount of the claims in installments unless prescribed otherwise in other statutes or regulations. |
| Article 124 (Special Agreement on Extending Period during Which Claims Are Met) |
| (1) | The heads of local governments may each conclude special agreements on extending the period during which claims (excluding claims collected according to the example of a disposition taken to collect local taxes and local taxes in arrears) are met or take a disposition to extend the period during which claims are met (hereinafter referred to as a "special agreement on extending the period during which the claims are met") only in the case falling under any of the following subparagraphs, except in cases prescribed by other statutes. In such cases, the period during which the amount of the relevant claims is paid in installments may be set: <Amended on Sep. 26, 2023> |
| 1. | When the debtor is insolvent or is in circumstances similar to insolvency; |
| 2. | When the debtor faces difficulty to repay the whole of the relevant obligations at one time and it is deemed advantageous to extend the period during which the obligations are repaid in light of the assets that are presently owned by him/her; |
| 3. | When it is deemed inevitable to extend the period during which the obligations are repaid after it is deemed difficult for the debtor to repay the whole of the obligations at one time on the grounds of any disaster or any accident that the debtor suffers; |
| 4. | When it is difficult for the debtor to repay the whole of the obligations at one time according to contract and it is deemed that the repayment of the obligations within the fixed time limit is feared to greatly undermine the public interest; |
| 5. | When, in connection with the claim for compensatory damages or a refund of the amount obtained by unjust enrichment, the debtor is unable to repay the whole of the obligations at one time, but he/she is deemed conscientious in the repayment of such obligations. |
| (2) | The head of the relevant local government may conclude special agreements on extending the period during which claims are met pursuant to the provisions of paragraph (1) even after the lapse of the period during which the claims are met: Provided, That in such cases, the claims for late payment penalties (referring to the compensatory damages on the delay in meeting the claims and other amounts for collection; hereinafter the same shall apply) that have already accrued, shall be collected. |
| (3) | Where the claims are set to be met in installments and a special agreement on extending the period during which such claims are met is concluded, when it is deemed especially necessary, the head of the relevant local government may take measures to extend the period during which the amount of the claims is paid after the relevant period during which the claims are met. |
| (4) | If the debtor intends to conclude a special agreement on extending the period during which a claim is met pursuant to the provisions of paragraphs (1) through (3), he/she shall file an application with the head of the relevant local government for a special agreement on extending the period during which the claim is met. |
| (5) | Upon receiving an application for a special agreement on extending the period during which a claim is met pursuant to the provisions of paragraph (4), the head of the relevant local government shall request the tax office, etc. to inspect and confirm whether the debtor owns his/her property: Provided, That the same shall not apply to cases where the amount of the claim is less than 100,000 won. |
| Article 125 (Deadline for Extending Period during Which Claims Are Met) |
| (1) | Where a special agreement is concluded on expending the period during which claims are met, the heads of local governments shall limit the extension of the period to five years or less (not more than ten years where the case falls under the provisions of Article 124 (1) 1) from the period during which the claims are met (where a special agreement is concluded on extending the period during which the claims are met after the period during which the claims are met, it refers to the date on which the relevant special agreement is concluded): Provided, That when it is deemed necessary, further special agreements on extending the period during which claims are met may be concluded. |
| (2) | Where a further special agreement is concluded on extending the period during which the claims are met pursuant to the provisions of paragraph (1), the extended period during which the claims are met shall not exceed ten years (20 years in cases falling under Article 124 (1) 1). |
| Article 126 (Measures for Special Agreement on Extending Period during Which Claims Are Met) |
| (1) | Where a special agreement is concluded on extending the period during which claims are met, the heads of local governments shall each cause security to be furnished and interest to be borne: Provided, That in cases falling under Article 124 (1) 1, the furnishing of any security or the bearing of interest may be exempted. |
| (2) | The interest rate of claims for which a special agreement is concluded on the extension of the period during which the claims are met pursuant to the provisions of paragraph (1) shall be the interest rate applicable at the time when banks prescribed by the Banking Act lend out general funds as of the date on which the special agreement is concluded on extending the period during which the claims are met. <Amended on Nov. 15, 2010> |
| Article 127 (Acquisition of Title) |
| (1) | When a special agreement is concluded on extending the period during the claims are met pursuant to the provisions of Article 124 for claims without title, the heads of local governments shall each take measures necessary to acquire the title, except in cases falling under any of the following subparagraphs: |
| 1. | Where the relevant claims are fully secured; |
| 2. | Where the debtor is deemed unable to bear expenses necessary to acquire the title; |
| 3. | Where the acquisition of the title is in fact deemed ineffective on the grounds of the debtor's insolvency. |
| (2) | When the head of the relevant local government finds it necessary to acquire the title pursuant to the provisions of paragraph (1), he/she shall determine the action to be taken by the debtor and the time limit therefor and then notify the relevant debtor thereof. |
| Article 128 (Conditions Set in Special Agreement on Extending Period during Which Claims Are Met) |
Where a special agreement is concluded on extending the period during which claims are met, the head of the relevant local government shall set the conditions falling under the following subparagraphs:
| 1. | When it is necessary to preserve the relevant claims, the head of the relevant local government is required to question the debtor or the guarantor about his/her business or his/her assets, inspect books, documents and other goods, and request the debtor or the guarantor to report and submit materials; |
| 2. | In the event falling under any of the following items, the head of the relevant local government is required to shorten the extended period during which the whole or part of the relevant claims are met: |
| (a) | When the debtor conceals, destroys or disposes of the property or he/she is feared to conceal, destroy or dispose of the property in a manner that is disadvantageous to the local government; |
| (b) | When the debtor falsely incurs other obligations; |
| (c) | Where the period during which the claims are met is extended by dividing the amount of the relevant claims into installments, when the debtor neglects to meet the amount of an installment payment of the claims; |
| (d) | When the grounds falling under any of the subparagraphs of Article 115 accrue; |
| (e) | When the debtor fails to meet the conditions referred to in subparagraph 1 and the conditions of the special agreement on extending the period during which the claims are met; |
| (f) | When it is deemed inappropriate to meet the claims according to the extended period during which the claims are met on the grounds of a change in the debtor's financial capacity and other circumstances. |
When any legal dispute arises over the claims, the head of the relevant local government may make a compromise on the dispute in order to settle such legal dispute when it is deemed inevitable and advantageous for the local government to settle the dispute and collect the relevant claims.
| (1) | With respect to the claims for which a special agreement is concluded on extending the period during which such claims are met on the grounds that the debtor is insolvent or nearly insolvent, where the debtor is still insolvent or nearly insolvent after the elapse of 10 years from the first period during which the claims are met (where a special agreement is concluded on extending the period during which the claims are met after the first period during which the claims are met, the date on which the special agreement is concluded on extending the first period during which the claims are met) and not expected to meet the claims, the head of the relevant local government may exempt the debtor from the relevant claims, late payment penalties and the interest that accrues from the claims. |
| (2) | Where the interest on delayed payment (referring to the interest provided for in the provisions of Article 126; hereinafter the same shall apply) is added to the claims for which a special agreement is concluded on extending the period during which such claims are met, when the debtor pays the amount equivalent to the total amount (excluding the interest on delayed payment) of the claims within the extended period during which the claims are met, the head of the relevant local government may exempt the debtor from an amount equivalent to the whole or part of the interest on delayed payment only where it is deemed inevitable in light of the state of the debtor's solvency. |
| (3) | When the debtor seeks exemption from his/her obligations pursuant to the provisions of paragraphs (1) and (2), he/she shall file an application with the head of the relevant local government for exemption of his/her obligations. |
| (4) | Upon receiving the application for the exemption of the obligations pursuant to the provisions of paragraph (3), the head of the relevant local government shall request the tax office, etc. to inspect and confirm whether the debtor owns his/her property: Provided, That the same shall not apply to cases where the amount of the claim is less than 100,000 won. |
| Article 131 (Special Case concerning Late Payment Penalties) |
| (1) | When the amount of the claim (excluding any claim that bears interest or is governed by the provisions of other statutes or regulations concerning late payment penalties) that is not repaid within the period during which such claim is to be met, does not exceed 10,000 won, the head of the relevant local government may not add late payment penalties thereto. |
| (2) | With respect to the claims falling under any of the following subparagraphs, when an amount equivalent to the whole of the principal is repaid, the whole or part of the late payment penalties that are added thereto may be exempted: |
| 1. | Tuition fees and dormitory charges collected by educational facilities that are established by local governments; |
| 2. | All expenses collected from patients by medical facilities that are established by local governments; |
| 3. | A refund of the amount unjustly obtained by the debtor without intention or gross negligence. |
| Article 132 (Terms of Contracts concerning Claims) |
Any public official in charge of concluding contracts or other acts that give rise to claims for any local government (hereinafter referred to as the "public official in charge of contracts") pursuant to the provisions of statutes or regulations, municipal ordinances or rules shall not enter into any agreement on matters concerning the reduction and exemption of the claims and the extension of the period during which the claims are met when he/she intends to decide on the terms of the relevant claims with the exception of the matters prescribed by statutes or regulations, municipal ordinances or rules.
| Article 133 (Agreement on Contract of Claims) |
| (1) | When the public official in charge of contracts intends to decide on the terms of any contract that establishes claims, he/she shall conclude an agreement on the requirements falling under the following subparagraphs except when the preparation of such written contract may be exempted: |
| 1. | When the debtor fails to meet his/her claims by the period during which such claims are to be met, he/she is required to pay an amount calculated according to certain standards as a late payment penalty to the relevant local government; |
| 2. | When the debtor neglects to meet the amount of claims that must be met in installments, the period during which the whole or part of the relevant claims are to be met is required to be shortened; |
| 3. | When the security of the secured claims reduces in value or circumstances that disqualify the guarantor occur, the debtor is required to furnish additional security, change the guarantor or the security at the request of the relevant local government; |
| 4. | When it is deemed necessary to preserve the relevant claims, the debtor or the guarantor is required to answer questions about his/her business, the current state of his/her property, or to cooperate with the inspection of his/her books, documents and other goods or to make reports and submit materials; |
| 5. | When the debtor fails to comply with the matters referred to in subparagraphs 1 through 4, the period during which the whole or part of the relevant claims is to be met shall be shortened. |
| (2) | With respect to the claims on loans where the purpose of use is specified, aside from the requirements referred to each subparagraph of paragraph (1), with the exception of its subparagraphs, an agreement shall also be concluded on the requirements falling under the following subparagraphs: |
| 1. | Where the debtor fails to apply the loan proceeds to the purpose for which such loans are granted within the deadline, all or part of the claims are required to be recovered before the period during which the claims are to be met; |
| 2. | Where the debtor fails to earnestly implement the terms prescribed in the loan contract, all or part of the claims are required to be recovered before the period during which the claims are to be met. |
CHAPTER X ACCOUNTING OFFICERS Deleted
| Article 134 Deleted. <Nov. 29, 2016> |
| Article 135 Deleted. <Nov. 29, 2016> |
| Article 136 Deleted. <Nov. 29, 2016> |
| Article 137 Deleted. <Nov. 29, 2016> |
| Article 138 Deleted. <Nov. 29, 2016> |
| Article 139 Deleted. <Nov. 29, 2016> |
CHAPTER XI SUPPLEMENTARY PROVISIONS
| Article 140 Deleted. <Nov. 29, 2016> |
| Article 141 Deleted. <Nov. 29, 2016> |
| Article 142 Deleted. <Nov. 29, 2016> |
| Article 143 Deleted. <Nov. 29, 2016> |
| Article 144 Deleted. <Nov. 29, 2016> |
| Article 145 Deleted. <Nov. 29, 2016> |
| Article 146 (Provision of Education for Finance-Related Public Officials) |
| (1) | The Minister of the Interior and Safety and the heads of local governments may conduct education, at least once a year, for public officials related to local government finance, pursuant to Article 96-3 of the Act. <Amended on Jul. 26, 2017> |
| (2) | The head of a local government shall survey the demand for education and training among the finance-related public officials of the local government and encourage them to participate in such education and training. |
| (3) | Except as provided in paragraphs (1) and (2), matters necessary for the provision of education for public officials related to local government finance shall be determined by the Minister of the Interior and Safety. <Amended on Jul. 26, 2017> |
[This Article Newly Inserted on Nov. 28, 2014]
[종전 제146조는 제147조로 이동 <2014. 11. 28.>]
| Article 147 (Handling of Personally Identifiable Information) |
| (1) | The heads of local governments (including those to whom relevant authority is delegated or entrusted) or accounting-related officials may handle data containing information on the resident registration numbers or alien registration numbers prescribed in subparagraph 1 or 4 of Article 19 of the Enforcement Decree of the Personal Information Protection Act, if essential to perform each of the following affairs: |
| 1. | Deleted; <Nov. 29, 2016> |
| 2. | Deleted; <Nov. 29, 2016> |
| 3. | Deleted; <Nov. 29, 2016> |
| 4. | Deleted; <Nov. 29, 2016> |
| 5. | Deleted; <Nov. 29, 2016> |
| (2) | Deleted. <Nov. 29, 2016> |
[This Article Newly Inserted on Aug. 6, 2014]
[Moved from Article 146 <Nov. 28, 2014>]
ADDENDA <Presidential Decree No. 19226, Dec. 30, 2005>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2006: Provided, That the amended provisions of Articles 62 and 63 shall enter into force on January 1, 2007. Article 2 (Application Precedent concerning Financial Reports)
The matters concerning financial reports among the amended provisions of Article 59 (2) shall apply, starting with the portion of the 2007 fiscal year. Article 3 (Application Precedent concerning Payment Notices)
The amended provisions of Article 111 shall apply, starting with the claims that first accrue after this Decree enters into force. Article 4 (Application Precedent concerning Demand Notices)
The amended provisions of Article 112 (2) shall apply, starting with the first demand notice that is issued after this Decree enters into force. Article 5 (Application Precedent concerning Special Agreements by Which Period for Meeting Claims Is Extended)
The amended provisions of Article 126 (2) shall apply, starting with the claims for which the special agreement is first concluded on the extension of the period during which such claims are to be met after this Decree enters into force. Article 6 (Transitional Measures concerning Ceiling on Issuance of Local Government Bonds)
The amount of local government bonds that are issued by the local gov ernments prior to the enforcement of this Decree shall be deemed to be in conformity with the ceiling on the amount of local government bonds that can be issued pursuant to the amended provisions of Article 10 (1). Article 7 (Relation with Other Statutes or Regulations)
Where the previous Enforcement Decree of the Local Finance Act or the provisions thereof is or are cited by other statutes or regulations at the time of enforcement of this Decree, when the corresponding cited provisions exist in this Decree, this Decree or the relevant provisions of this Decree shall be deemed cited in lieu of the previous provisions.
ADDENDA <Presidential Decree No. 19586, Jun. 30, 2006>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDUM <Presidential Decree No. 19735, Nov. 23, 2006>
This Decree shall enter into force on January 1, 2007.
ADDENDUM <Presidential Decree No. 19995, Apr. 5, 2007>
This Decree shall enter into force on the date of its promulgation.
ADDENDUM <Presidential Decree No. 20123, Jun. 28, 2007>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 20445, Dec. 13, 2007>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDUM <Presidential Decree No. 20504, Dec. 31, 2007>
This Decree shall enter into force on January 1, 2008: Provided, That the amended provisions of Articles 45 and 47 shall apply when the budgets of annual revenues and expenditures for 2008 are compiled.
ADDENDA <Presidential Decree No. 20741, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDA <Presidential Decree No. 21087, Oct. 20, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 21214, Dec. 31, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 21260, Jan. 13, 2009>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Effective Period)
The amended provisions of Article 91 (1) 15 shall be effective by October 31, 2009.
ADDENDA <Presidential Decree No. 21495, May 21, 2009>
Article 1 (Enforcement Date)
This Decree shall enter into force one month after the date of its promulgation.
Article 2 (Applicability)
The amended provisions of Article 41 shall apply from the cases where the request for feasibility study is made after this Decree enters into force.
ADDENDA <Presidential Decree No. 21656, Jul. 30, 2009>
Article 1 (Enforcement Date)
This Decree shall enter into force on July 31, 2009.
Article 2 Omitted.
ADDENDUM <Presidential Decree No. 21801, Nov. 2, 2009>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 22493, Nov. 15, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on November 18, 2010
Articles 2 through 5 Omitted.
ADDENDUM <Presidential Decree No. 22532, Dec. 20, 2010>
This Decree shall enter into force on January 1, 2011: Provided, That the amended provisions of Article 103-2 shall enter into force on March 1, 2011.
ADDENDA <Presidential Decree No. 22564, Dec. 29, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on December 30, 2010. (Proviso Omitted.)
Articles 2 through 8 Omitted.
ADDENDA <Presidential Decree No. 23121, Sep. 6, 2011>
Article 1 (Enforcement Date)
This Decree shall enter into force on September 9, 2011: Provided, That the amended provisions of Articles 65-3 and 65-4 shall enter into force on January 1, 2012. Article 2 (Applicability to Subsidies)
The amended provisions of Articles 30-2 through 30-4 shall apply beginning from the first subsidy to be granted after this Decree enters into force. Article 3 (Applicability to Details of and Standards for Preparation of Gender-Sensitive Budget, and of Gender-Sensitive Settlement of Accounts)
The amended provisions of Articles 40-2 and 63-2 shall apply beginning from a gender-sensitive budget bill and gender-sensitive settlement of accounts for the 2013 fiscal year, respectively. Article 4 (Applicability to Interest on Refunds of Overpayments or Erroneous Payments)
The amended provisions of Article 84-2 shall apply beginning from the first refund of an overpayment or erroneous payment to be made after this Decree enters into force. Article 5 Omitted.
ADDENDUM <Presidential Decree No. 23573, Jan. 31, 2012>
This Decree shall enter into force on February 5, 2012.
ADDENDA <Presidential Decree No. 23645, Feb. 29, 2012>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2013. (Proviso Omitted.)
Articles 2 and 3 Omitted.
ADDENDUM <Presidential Decree No. 23674, Mar. 26, 2012>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 24425, Mar. 23, 2013>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation: Provided, That concerning Presidential Decree amended pursuant to Article 6 of Addenda, amended parts of Presidential Decree which have been promulgated before this Decree enters into force but the enforcement date of which has not come shall enter into force on the date the relevant Presidential Decree enters into force, respectively. Articles 2 through 6 Omitted.
ADDENDUM <Presidential Decree No. 25103, Jan. 17, 2014>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 25226, Mar. 5, 2014>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 and 3 Omitted.
ADDENDUM <Presidential Decree No. 25532, Aug. 6, 2014>
This Decree shall enter into force on August 7, 2014.
ADDENDA <Presidential Decree No. 25751, Nov. 19, 2014>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation: Provided, That any amendment of the Presidential Decrees made pursuant to Article 5 of this Addenda, which were promulgated before this Presidential Decree comes into force, but the enforcement date of which has yet to arrive, shall enter into force on the date of the corresponding Presidential Decree takes effect. Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 25781, Nov. 28, 2014>
Article 1 (Enforcement Date)
This Decree shall enter into force on November 29, 2014: Provided, That the amended provisions of Articles 30-2 through 30-4, 37-2 through 37-6, 98 and 99 shall enter into force on January 1, 2015. Article 2 (Applicability to Types and Distribution of Grants-In-Aid for Adjustment among Sis/Guns)
The amended provisions of Article 36 (2) through (4) shall begin to apply from January 1, 2015. Article 3 (Transitional Measures concerning Receipts and Disbursements Following Adjustment of Deadline for Closing Receipts and Disbursements)
Receipts and disbursements for fiscal years preceding fiscal year 2015 shall be governed by the former provisions, notwithstanding the amended provisions of subparagraph 4 of Article 2, the proviso to subparagraph 6 of Article 3, the proviso to Article 4, and Article 5. Article 4 Omitted.
ADDENDUM <Presidential Decree No. 26572, Oct. 6, 2015>
This Decree shall enter into force on the date of its promulgation: Provided, That the amended provisions of Article 65-2 (1) 2 and 3 shall enter into force on January 1, 2019.
ADDENDUM <Presidential Decree No. 26691, Dec. 4, 2015>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 27268, Jun. 28, 2016>
Article 1 (Enforcement Date)
This Decree shall enter into force on June 30, 2016.
Article 2 (Applicability to Projects Exempt from Assessment of Impact on Local Public Finance)
The amended provision of Article 35-5 (2) shall apply beginning with a project whose impact on local public finance is assessed by the head of a local government after this Decree enters into force. Article 3 (Applicability to Payment of Rewards for Making Reports)
The amended provisions of Article 37-7 shall apply beginning with cases where a report or accusation is made after this Decree enters into force. Article 4 (Applicability to Examination of Financial Investment Projects)
The amended provisions of Article 41 (1) 1 (c) and (d) and subparagraph 2 (c) and (d) of the aforesaid paragraph shall apply beginning with cases where an examination of a financial investment project is made or entrusted after this Decree enters into force.
ADDENDA <Presidential Decree No. 27299, Jun. 30, 2016>
Article 1 (Enforcement Date)
This Decree shall enter into force on July 1, 2016. (Proviso Omitted.)
Articles 2 through 15 Omitted.
ADDENDA <Presidential Decree No. 27463, Aug. 29, 2016>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2017.
Article 2 (Transitional Measure concerning Repeal of Special Cases of Preferential Distribution of General Grants-In-Aids)
| (1) | Notwithstanding the amendments of Article 36 (4), Mayor/Do Governor may preferentially distribute an amount referred in the following as general grants-in-aids by 2018 to Si/Gun entitled to general grants-in-aids under the previous Article 36 (4): |
| 1. | 2017: 80 percent of an amount the relevant Si/Gun contributes to raising fund for grants-in-aid during the relevant period; |
| 2. | 2018: 70 percent of an amount the relevant Si/Gun contributes to raising fund for grants-in-aid during the relevant period. |
| (2) | Si/Gun to which general grants-in-aid is distributed shall be governed by the previous provisions until 2018 notwithstanding the amendments of Article 36 (3). |
ADDENDA <Presidential Decree No. 27621, Nov. 29, 2016>
Article 1 (Enforcement Date)
This Decree shall enter into force on November 30, 2016.
Articles 2 and 3 Omitted.
ADDENDA <Presidential Decree No. 27959, Mar. 27, 2017>
Article 1 (Enforcement Date)
This Decree shall enter into force on March 28, 2017.
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 28211, Jul. 26, 2017>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation: Provided, That among Presidential Decrees amended by Article 8 of the Addenda, the amendments to Presidential Decrees which have been promulgated before this Decree enters into force but of which the enforcement dates have yet to arrive shall enter into force on the date the relevant Presidential Decree takes effect. Articles 2 through 8 Omitted.
ADDENDA <Presidential Decree No. 28521, Dec. 29, 2017>
ADDENDA <Presidential Decree No. 29440, Dec. 31, 2018>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2019.
Article 2 (Applicability to Payment of Rewards for Making Reports)
The amended provision of Article 37-7 (2) shall begin to apply from cases where a person makes a report or accusation on or after this Decree enters into force.
ADDENDA <Presidential Decree No. 30500, Mar. 3, 2020>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Applicability to Financial Resources of Grants-in-Aid for Adjustment among Autonomous Gus)
The amended provisions of Article 36-2 (1) shall apply from the portion of 2020 fiscal year. Article 3 (Applicability to Division of Items of Revenue Budget)
The amended provisions of the proviso of Article 47 (1) shall apply from the portion of 2020 fiscal year.
ADDENDA <Presidential Decree No. 30653, Apr. 28, 2020>
Article 1 (Enforcement Date)
This Decree shall enter into force on April 30, 2020.
Article 2 (Applicability to Payment of Reward for Reporting on Extravagant Budget Spending)
The amended provisions of Article 54-3 shall begin to apply to applications filed for the demand for the rectification or a proposal after this Decree enters into force. Article 3 (Transitional Measures concerning Payment of Reward for Reporting)
Where the payment of a monetary award has been notified under the former part of Article 37-7 (1) before this Decree enters into force, notwithstanding the amended provision of paragraph (2) of the same Article, the former provision shall govern.
ADDENDA <Presidential Decree No. 31343, Dec. 31, 2020>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2021. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDUM <Presidential Decree No. 31380, Jan. 5, 2021>
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
ADDENDA <Presidential Decree No. 31883, Jul. 13, 2021>
Article 1 (Enforcement Date)
This Decree shall enter into force on July 13, 2021.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 32223, Dec. 16, 2021>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 13, 2022. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDUM <Presidential Decree No. 32290, Dec. 31, 2021>
This Decree shall enter into force on January 1, 2022.
ADDENDA <Act No. 33739, Sep. 26, 2023>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation: Provided, That the amended provisions of Articles 35-5 (1) 1 and 35-6 (2) shall enter into force on January 1, 2024. Article 2 (Applicability to Assessment of Impacts on Local Government Finance)
| (1) | The amended provisions of Article 35-5 (1) 1 (b) shall begin to apply to projects applied for attraction or applied for subscription under the former part of Article 27-6 (1) of the Act after the enforcement date prescribed in the proviso of Article 1 of the Addenda. |
| (2) | The amended provisions of Article 35-6 (2) 1 shall begin to apply to projects for which opinions of the Minister of the Interior and Safety are heard pursuant to Article 25 of the Act or for which consultation with the Minister of the Interior and Safety is held pursuant to Article 26 of the Act after the enforcement date prescribed in the proviso of Article 1 of Addenda. |
| (3) | The amended provisions of Article 35-6 (2) 2 shall also apply to projects appraised by the head of a central government agency under the former part of Article 27-6 (2) of the Act before the enforcement date under the proviso of Article 1 of Addenda. |
Article 3 (Applicability to Documents to Accompany Budget Bills)
| (1) | The amended provisions of subparagraph 2-2 of Article 49-2 shall begin to apply where a budget bill for fiscal year 2024 is submitted to the local council. |
| (2) | The amended provisions of subparagraphs 4-2 through 4-4 of Article 49-2 shall begin to apply where a budget bill for a fiscal year 2025 is submitted to the local council. |
Article 4 (Applicability to Common Publication)
The amended provisions of Article 68 (2) 1 shall begin to apply to the budget to be finalized after this Decree enters into force and the settlement of accounts approved for the relevant budget.