Subsidy Management Act


Published: 2011-07-25

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CHAPTER I GENERAL PROVISIONS
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 Article 1 (Purpose)   print
The purpose of this Act is to ensure appropriate management of subsidy budgets, such as efficient budgeting and implementation thereof, by establishing basic rules regarding the budgeting, applications for granting, decisions to grant, use, etc. of subsidies.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 2 (Definitions)   print
The terms used in this Act shall be defined as follows:
1. The term "subsidies" means subsidies (limited to subsidies granted to local governments or granted for the establishment of facilities or operation of corporations, organizations or individuals) , financial aid (excluding that granted under any international treaty) that are granted by the State (including an entity that manages and operates a Fund established under any Act listed in attached Table 2 of the National Finance Act) and other benefits prescribed by Presidential Decree which are granted without any corresponding consideration to promote, or provide financial assistance in, work or programs implemented by any non-State entity;
2. The term "subsidy program" means any work or program eligible for the granting of a subsidy;
3. The term "subsidy program operator" means any person who operates a subsidy program;
4. The term "indirect subsidies" means benefits that a non-State entity re-grants gratuitously from funds created with all or some of its subsidies in accordance with the original purposes of such subsidies;
5. The term "indirect subsidy program" means any work or program eligible for an indirect subsidy grant;
6. The term "indirect subsidy program operator" means any person who operates an indirect subsidy program;
7. The term "head of a central government agency" means the head of a central government agency referred to in Article 6 (2) of the National Finance Act;
8. The term "subsidy recipient" means any person who receives a subsidy or indirect subsidy from a subsidy program operator or indirect subsidy program operator.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 3 (Relationship, etc. to other Acts)   print
(1) Except as otherwise prescribed by any other Act, this Act shall apply to the management of subsidies, such as budgeting and implementation thereof.
(2) With respect to the formulation of subsidy budgets for a local government's education, sciences and sports for the purposes of this Act, "Minister of Public Administration and Security" shall be construed as "Minister of Education, Science and Technology"; the "head of a local government" or "Special Metropolitan City Mayor, Metropolitan City Mayor, Do Governor or Governor of a Special Self-Governing Province" shall be construed as "Superintendent of an Office of Education".
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
CHAPTER II FORMULATION OF SUBSIDY BUDGET
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 Article 4 (Subsidy Budget Proposals, etc. by Persons who Intend to Operate Subsidy Programs)   print
(1) Any person who intends to operate a subsidy program shall annually submit a proposal to the head of the relevant central government agency to appropriate the amount of subsidy required for a budget.
(2) When making a proposal pursuant to paragraph (1) , a written proposal stating the purposes and details of a subsidy program, expenses to be incurred in relation to a subsidy program and other necessary matters and the reference documents shall be submitted.
(3) In cases falling under paragraphs (1) and (2) , where the heads of Sis/Guns intend to operate subsidy programs, the competent Do Governor (referring to a Metropolitan City Mayor in cases of a Gun located in a Metropolitan City; hereinafter the same shall apply) may submit a comprehensive proposal that combines proposals submitted by the heads of the relevant Sis/Guns.
(4) Matters necessary for making proposals under paragraphs (1) through (3) , including a form of proposal, reference documents, and due date thereof, shall be determined by the head of the relevant central government agency. In such cases, the due date for submission shall be earlier than May 31st of the year preceding the relevant fiscal year.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 5 (Exceptions to Subsidy Programs without Budget Proposals)   print
The State may appropriate subsidies in a budget with respect to any program without a budget proposal made under Article 4 in cases prescribed by Presidential Decree as unavoidable for the implementation of national policies.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 6 (Requests for Allocation of Subsidies by Heads of Central Government Agencies)   print
(1) The head of a central government agency shall adjust the amount and details of subsidies proposed by those who intend to operate subsidy programs, and request the Minister of Strategy and Finance to allocate the subsidy budget. In such cases, he/she may request the said Minister to allocate the subsidy budget for any program referred to in Article 5, even though a budget proposal for such program has not been submitted.
(2) In cases falling under paragraph (1) , a subsidy budget for any program in which most local governments are involved may be requested in a lump sum, without details for each local government.
(3) Where the head of a central government agency requests the allocation of subsidy budget for any program, the reference materials of which shall be submitted by order of the Minister of Strategy and Finance, he/she shall submit the details of the budget proposal by the person who intends to operate the subsidy program, details of adjustment made by the head of the central government agency, and other necessary materials.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 7 (Consultation, etc. on Cost Sharing with Local Governments)   print
(1) Where the head of a central government agency intends to request the allocation of a subsidy budget for any program that requires cost sharing with a local government, he/she shall consult on the plan for such program with the Minister of Public Administration and Security.
(2) Upon receipt of a request for consultation under paragraph (1) , the Minister of Public Administration and Security shall submit a written statement of his/her opinion to the Minister of Strategy and Finance and to the head of the relevant central government agency by not later than June 20th of the year preceding the relevant fiscal year.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 8 (Submission, etc. of Materials by Persons who Intend to Operate Subsidy Programs)   print
(1) Upon receipt of a request from the head of a central government agency, any person who intends to operate a subsidy program shall submit materials necessary for subsidy budget proposals or provide an explanation thereof to the head of the central government agency.
(2) Where the Minister of Strategy and Finance deems it specifically necessary for adjusting the amount of a subsidy budget requested by the head of a central government agency, he/she may request a person who intends to operate the relevant subsidy program to submit necessary materials or provide an explanation thereof.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 9 (Programs Eligible for Subsidies, Basic Subsidy Rate, etc. )   print
Programs eligible for subsidies, items of expenses, rates and amount of national subsidies shall be stipulated in a budget, each year: Provided, That the following matters shall be prescribed by Presidential Decree with respect to subsidies to be granted to local governments:
1. Scope of programs eligible for subsidies;
2. A basic rate of national subsidy (hereinafter referred to as "basic subsidy rate) that applies to subsidies for each program when making a budget proposal for such subsidies and when budgeting such subsidies.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 10 (Application of Differential Subsidy Rates)   print
(1) Where the Minister of Strategy and Finance allocates a subsidy budget to a local government each year, he/she may apply a differential subsidy rate which adds or subtracts a certain rate to or from the basic subsidy rate in consideration of the financial status of the local government to any subsidy program deemed necessary for the application of the differential subsidy rate. In such cases, a differential subsidy rate which subtracts a certain rate from the basic subsidy rate may apply only to local governments that do not receive general subsidies pursuant to the Local Subsidy Act.
(2) The application of a differential subsidy rate shall be based on the degree of financial independence of a local government eligible for the application of a differential subsidy rate, fiscal expenditure index for each item, and other matters prescribed by Presidential Decree; and the detailed formula for each base shall be prescribed by Presidential Decree.
(3) The Minister of Strategy and Finance shall report to the National Assembly on matters concerning supplementary budgets for national subsidies required due to the application of a differential subsidy rate under paragraph (2) .
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 11 (Presentation of Opinions on Budgeting of Subsidies)   print
(1) In the process of budgeting for subsidies, a Special Metropolitan City Mayor, Metropolitan City Mayor, Do Governor or the Governor of a Special Self-Governing Province may present, to the head of the relevant central government agency and the Minister of Strategy and Finance, opinions concerning the priority of subsidy programs to be operated within his/her jurisdiction or the adjustment of the amount of a subsidy budget.
(2) The Minister of Strategy and Finance may reflect in a budget, matters deemed appropriate among the opinions presented by a Special Metropolitan City Mayor, Metropolitan City Mayor, Do Governor, or the Governor of a Special Self-Governing Province, after hearing the opinion from the head of the relevant central government agency.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 12 (Notice of Subsidy Budget)   print
(1) The head of a central government agency shall notify each person who intends to operate a subsidy program of a subsidy budget bill by October 15th of the year preceding the relevant fiscal year, and of the amount and details of the final budget immediately after the budget is reviewed and approved by the National Assembly, except in extenuating circumstances.
(2) With respect to subsidies to be granted to a local government, the head of the relevant central government agency shall notify the Minister of Strategy and Finance and the Minister of Public Administration and Security of the details referred to in paragraph (1) .
(3) When giving notice to the heads of Sis/Guns who intend to operate subsidy programs pursuant to paragraph (1) , such notice may be given collectively to the Do Governor who has jurisdiction over the relevant Sis/Guns.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 13 (Local Government's Obligation to Bear Costs)   print
The head of a local government shall appropriate the costs for subsidy programs to be borne by the relevant local government in its budget for the relevant year, in preference to other programs.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 14 (Restrictions on Granting of Additional Subsidies to Government-Funded Institutions)   print
The State shall not allocate any additional subsidy to the budget for the institutions, for which contributions are appropriated in a national budget: Provided, That this shall not apply where the Minister of Strategy and Finance deems it specifically unavoidable to implement a program.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 15 (Assessment of Subsidy Program Operation)   print
(1) The Minister of Strategy and Finance shall assess the effectiveness, the necessity for support, etc. of subsidy programs subject to self-assessment of fiscal projects under Article 8 of the National Finance Act and decide on whether such programs are to be continued.
(2) The Minister of Strategy and Finance may organize and operate a Subsidy Program Assessment Board to assess subsidy programs and decide on whether such programs are to be continued pursuant to paragraph (1) .
(3) The Minister of Strategy and Finance shall report to the National Assembly the results of assessment of subsidy programs under paragraph (1) , along with a budget bill under Article 33 of the National Finance Act.
(4) Detailed scope of subsidy programs under paragraph (1) and matters necessary for the organization and operation of the Subsidy Program Assessment Board under paragraph (2) shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 10898, Jul. 25, 2011]
CHAPTER III APPLICATION FOR AND DECISION ON GRANTING OF SUBSIDIES
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 Article 16 (Applications for Granting of Subsidies)   print
(1) Any person who intends to receive subsidies shall submit to the head of the relevant central government agency a written application stating the purposes and details of the subsidy program, expenses to be incurred in relation to the subsidy program, and other necessary matters, along with the documents prescribed by the head of the relevant central government agency, by a deadline designated by the head of the relevant central government agency, as prescribed by Presidential Decree.
(2) The head of a central government agency shall announce a public invitation to submit applications for the granting of subsidies under paragraph (1) : Provided, That this shall not apply to any of the following cases:
1. If subsidies for a program are budgeted upon application by the person who intends to operate such program, and it is deemed that the purposes of such program are defeated without the involvement of such applicant;
2. If the head of a local government intends to operate a subsidy program;
3. Except as otherwise prescribed in subparagraphs 1 and 2, if it is deemed inappropriate to receive applications through a public invitation, in consideration of the characteristics of subsidy programs.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 17 (Decisions on Granting of Subsidies)   print
(1) Where an application for the granting of subsidies under Article 16 is submitted, the head of the relevant central government agency shall investigate the following matters and decide on, without delay, whether he/she grants subsidies:
1. Compliance with Acts and subordinate statutes and with the purposes of a subsidy budget;
2. Appropriateness of a subsidy program;
3. Presence of mistakes in the calculation of the amount;
4. Capability of bearing financial burden (only in cases where a subsidy program operator shall bear a part of financial burden) .
(2) Where the head of a central government agency receives an application for the granting of subsidies through a public invitation pursuant to Article 16 (2) , he/she shall decide on whether subsidies are granted under paragraph (1) after deliberation thereon by the committee for the selection of subsidy program operators.
(3) Basic matters necessary for the organization and operation of the committee for the selection of subsidy program operators under paragraph (2) shall be determined by the Minister of Strategy and Finance, and other detailed matters shall be prescribed by the head of the relevant central government agency.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 18 (Conditions for Granting of Subsidies)   print
(1) The head of a central government agency may place conditions on the granting of subsidies to attain the purposes of the granting of subsidies specified in the relevant Acts and subordinate statutes or in the relevant budget.
(2) The head of a central government agency may decide on the granting of subsidies on condition that, if substantial profits accrue to a subsidy program operator upon the completion of the relevant subsidy program, the subsidy program operator fully or partially return to the State the amount of subsidies he/she has received, to the extent that does not defeat the purposes of the granting of such subsidies.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 19 (Notice of Decisions on Granting of Subsidies)   print
(1) Where the head of a central government agency decides to grant subsidies, he/she shall, without delay, give notice of such decision (if any condition is attached to the granting of subsidies, including such condition; hereinafter the same shall apply) to the person who applied for the granting of subsidies.
(2) Where the head of a central government agency gives notice of a decision to grant a subsidy to a local government pursuant to paragraph (1) , he/she shall, without delay, notify the Minister of Strategy and Finance and the Minister of Public Administration and Security of the details of the decision made by unit program or by program operator.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 20 (Integration and Operation of Subsidies)   print
(1) If the size of a subsidy becomes too small by itemizing a subsidy program, the head of a central government agency shall decide to grant a subsidy by integrating various items of expenses incurred in relation to each unit program.
(2) Standards for the amount, etc. to be granted upon integrating various items of expenses incurred in relation to each unit program pursuant to paragraph (1) shall be determined by Presidential Decree.
(3) The head of a central government agency may integrate and manage budgets for subsidy programs with similar purposes, as prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 21 (Revocation, etc. of Decisions to Grant Subsidies due to Change of Circumstances)   print
(1) If it is deemed necessary to revoke a decision to grant subsidies due to the change of any circumstance under which such decision was made, the head of a central government agency may change the details of the decision to grant subsidies or revoke the decision to grant subsidies wholly or partially: Provided, That this shall not apply with regard to the already implemented portion of a subsidy program.
(2) The head of a central government agency may revoke the decision to grant subsidies pursuant to paragraph (1) only in cases where it is unnecessary to continue the relevant subsidy program wholly or partially due to natural disasters that occur after the decision or due to the change of any other circumstance or where it is prescribed by Presidential Decree.
(3) Where the head of a central government agency intends to change the details of the decision to grant subsidies or revoke such decision pursuant to paragraph (1) , he/she shall submit documents stating the following information to the Minister of Strategy and Finance and consult with him/her: Provided, That with respect to any insignificant matter, notification to the Minister of Planning and Budget may substitute for such consultation:
1. Grounds for revocation of the decision to grant subsidies, etc. ;
2. Opinions of the relevant subsidy program operator regarding revocation of the decision to grant subsidies, etc. ;
3. Future plans to use subsidies that are not granted due to revocation of the decision to grant subsidies.
(4) Where the head of a central government agency revokes a decision to grant subsidies pursuant to paragraph (1) , he/she shall subsidize the affairs or projects that have become specifically necessary due to such revocation, as prescribed by Presidential Decree.
(5) Article 19 (1) shall apply mutatis mutandis where the details of the decision to grant subsidies are changed or the decision to grant subsidies is revoked pursuant to paragraph (1) .
(6) Where the details of the decision to grant subsidies are changed or the decision to grant subsidies is partially revoked pursuant to paragraph (1) , Article 20 shall apply mutatis mutandis with respect to subsidies to be granted accordingly.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
CHAPTER IV IMPLEMENTATION OF SUBSIDY PROGRAMS
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 Article 22 (Prohibition against Use for Unspecified Purposes)   print
(1) Any subsidy program operator shall conscientiously implement his/her subsidy program with the due care of a good manager, in accordance with Acts or subordinate statutes, details of the decision to grant subsidies, or dispositions the head of a central government agency has taken pursuant to Acts or subordinate statutes, and shall not use the subsidies for any other unspecified purpose.
(2) Any indirect subsidy program operator shall implement his/her indirect subsidy program with the due care of a good manager, in accordance with Acts or subordinate statutes and the purposes of granting of indirect subsidies, and shall not use the indirect subsidies for any other unspecified purpose.
(3) Notwithstanding paragraphs (1) and (2) , the excess amount of subsidies unreturned under Article 31 (4) may be used for other programs with similar purposes.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 23 (Change of Details of Subsidy Programs)   print
If any subsidy program operator intends to change the details of the subsidy program or change the allocation of expenses incurred in relation to the subsidy program due to a change in circumstances, he/she shall obtain approval from the head of the relevant central government agency: Provided, That this shall not apply to a change in minor matters determined by the head of the relevant central government agency.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 24 (Transfer, etc. of Subsidy Programs)   print
If any subsidy program operator intends to transfer the subsidy program to another subsidy program operator, suspend or terminate the subsidy program due to a change in circumstances, he/she shall obtain approval from the head of the relevant central government agency.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 25 (Monitoring, etc. of Implementation of Subsidy Programs)   print
(1) Any subsidy program operator or indirect subsidy program operator shall report the implementation of the subsidy program or indirect subsidy program to the head of the relevant central government agency or the relevant subsidy program operator, as prescribed by the head of the relevant central government agency.
(2) If deemed necessary to ascertain the implementation of a subsidy program or indirect subsidy program, the head of the relevant central government agency may conduct on-site inspections.
(3) Any subsidy program operator or indirect subsidy program operator shall keep data concerning the implementation of the subsidy program or indirect subsidy program for a period prescribed by Presidential Decree, for up to five years.
(4) The scope of data to be kept under paragraph (3) and other necessary matters shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 26 (Orders to Implement Subsidy Programs)   print
(1) If the head of a central government agency deems that a subsidy program operator fails to implement the subsidy program in accordance with Acts or subordinate statutes, details of the decision to grant subsidies, dispositions the head of a central government agency has taken pursuant to Acts or subordinate statutes, he/she may issue to the subsidy program operator an order necessary for the implementation thereof.
(2) If a subsidy program operator violates an order issued under paragraph (1), the head of the relevant central government agency may temporarily suspend the implementation of the subsidy program.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 26-2 (Improvement of Subsidy Program Management System)   print
The Minister of Strategy and Finance and the heads of central government agencies shall establish subsidy program management systems with integrated networks to effectively implement subsidy programs and to prevent duplicate or erroneous payment of subsidies, and shall take other necessary measures.
[This Article Newly Inserted by Act No. 10898, Jul. 25, 2011]
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 Article 27 (Reporting on Performance of Subsidy Programs)   print
(1) When a subsidy program or indirect subsidy program is completed, the termination thereof is approved, or the fiscal year ends, the subsidy program operator or indirect subsidy program operator shall prepare a performance report on his/her subsidy program or indirect subsidy program, and submit it to the head of the relevant central government agency or the relevant indirect subsidy program operator by a deadline specified by Presidential Decree, as prescribed by the head of the relevant central government agency.
(2) A performance report on subsidy program or indirect subsidy program referred to in paragraph (1) shall be submitted, along with the statement of account that details the expenses incurred in relation to the subsidy program or indirect subsidy program by financial resource group and documents prescribed by the head of the relevant central government agency.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 28 (Determination of Final Amount of Subsidies)   print
(1) Where the head of a central government agency receives a performance report from a subsidy program operator pursuant to Article 27, he/she shall review whether the performance of the subsidy program complies with Acts or subordinate statutes, details of the decision to grant subsidies, or dispositions the head of the central government agency has taken pursuant to an Act or subordinate statute. In such cases, an on-site inspection shall be conducted if deemed necessary.
(2) Where the head of the central government agency deems, as a result of the review under paragraph (1) , that the performance of the subsidy program meets the review standards under paragraph (1) , he/she shall determine a final amount of subsidies and give notice to the subsidy program operator.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 29 (Orders to Correct Subsidy Programs)   print
Where the head of a central government agency deems, as a result of the review on the performance report on a subsidy program submitted under Article 27, that the performance of the subsidy program fails to comply with Acts or subordinate statutes, details of the decision to grant subsidies, or dispositions the head of the central government agency has taken pursuant to an Act or subordinate statute, he/she may order the subsidy program operator to take measures necessary to correct the subsidy program.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
CHAPTER V RETURN OF SUBSIDIES
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 Article 30 (Revocation of Decisions to Grant Subsidies due to Violation of Acts, Subordinate Statutes, etc. )   print
(1) If a subsidy program operator falls under any of the following subparagraphs, the head of the relevant central government agency may entirety or partially revoke the decision to grant subsidies:
1. If he/she uses subsidies for other unspecified purposes;
2. If he/she fails to comply with Acts or subordinate statutes, details of the decision to grant subsidies or dispositions the head of the central government agency has taken pursuant to an Act or subordinate statute;
3. If he/she receives subsidies with a false application or by other wrongful means.
(2) If an indirect subsidy program operator falls under any of the following subparagraphs, the head of the relevant central government agency may take measures concerning the subsidy program operator to entirety or partially revoke the decision to grant the subsidies in which the indirect subsidies are involved:
1. If he/she uses indirect subsidies for any other unspecified purpose;
2. If he/she fails to comply with Acts or subordinate statues;
3. If he/she receives indirect subsidies with a false application or by other wrongful means.
(3) Article 19 shall apply mutatis mutandis where the decision to grant subsidies is revoked pursuant to paragraphs (1) and (2) .
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 31 (Return of Subsidies)   print
(1) If subsidies have already been paid before the revocation of the decision to grant subsidies, the head of a central government agency shall issue an order to return the subsidies that are connected with the revoked portion of the subsidy program and interest accrued therefrom upon specifying a deadline.
(2) If the aggregate of subsidies already paid and interest accrued therefrom exceeds the final amount of subsidies determined under Article 28, the head of a central government agency shall issue an order to return the surplus upon specifying a deadline: Provided, That this shall not apply to interest accrued due to extenuating circumstances prescribed by Presidential Decree from the subsidies that the head of a central government agency has paid to a subsidy program operator who is the head of a local government.
(3) If an order to return subsidies under paragraph (1) is issued due to the revocation of the decision to grant subsidies under Article 30 (2) , the head of a central government agency may extend the deadline for the return, as prescribed by Presidential Decree, only in cases where any unavoidable circumstance is deemed to exist.
(4) Notwithstanding paragraph (2) , the head of a local government may use the excess amount of subsidies for other subsidy programs with similar purposes (excluding programs prescribed by Presidential Decree, such as new programs) without returning such surplus in cases where the original purposes of the relevant subsidy program has been attained and the budget has been saved by the relevant local government's efforts. In such cases, the head of the local government shall submit to the head of the relevant central government agency documents stating the use of the unreturned excess amount (including the amount and detailed reasons of use, etc. by item) within one month from the date on which such surplus is used.
(5) If a local government uses surplus subsidies in violation of paragraphs (4) and (6) or a subsidy program operator or indirect subsidy program operator receives duplicate or excessive payment of subsidies, the Minister of Strategy and Finance shall take this into consideration when compiling a expenditure budget for the relevant subsidy program for the following fiscal year.
(6) Prerequisites to use surplus subsidies for other subsidy programs with similar purposes under paragraph (4) shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 32 (Temporary Suspension, etc. of Granting other Subsidies)   print
If a subsidy program operator to whom an order to return subsidies has been issued fails to perform such order, the head of a central government agency may suspend the granting of other subsidies to be used by the said subsidy program operator for the same kinds of affairs and programs or offset the amount of the said subsidies by the unreturned amount.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 33 (Compulsory Collection)   print
(1) The head of a central government agency may recover the subsidies that shall be returned under Article 31 in the same manner as national taxes are recovered.
(2) The recovery of an amount to be returned under paragraph (1) shall have priority over other public charges, except national taxes and local taxes.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 33-2 (Recovery, etc. of Subsidies from Subsidy Recipients)   print
(1) If a subsidy recipient falls under any of the following subparagraphs, the relevant subsidy program operator or indirect subsidy program operator shall order him/her to entirely or partially return the paid amount of subsidies, upon specifying a deadline:
1. If he/she receives subsidies with a false application or by other wrongful means;
2. If he/she uses subsidies for any purpose other than the prescribed purpose;
3. If he/she fails to meet the requirements to receive subsidies.
(2) If a subsidy recipient falls under any subparagraph of paragraph (1) , the relevant subsidy program operator or indirect subsidy program operator may choose not to pay subsidies during a period specified by the head of the relevant central government agency.
(3) If a subsidy recipient fails to return subsidies to be returned under paragraph (1) by a specified deadline, the head of a central government agency, or the head of a local government who is a subsidy program operator may recover them in the same manner as national taxes or local taxes are recovered.
[This Article Newly Inserted by Act No. 10898, Jul. 25, 2011]
CHAPTER VI SUPPLEMENTARY PROVISIONS
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 Article 34 (Establishment, etc. of Separate Accounts)   print
(1) A subsidy program operator or indirect subsidy program operator shall perform accounting by establishing a separate account for the subsidies or indirect subsidies he/she has received and separating them from his/her own revenues and expenditures.
(2) A subsidy program operator who is the head of a local government shall perform accounting pursuant to paragraph (1) by classifying the details and appropriation of national subsidies and those of local subsidies to be used for the implementation of the subsidy program.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 35 (Restrictions on Disposal of Property)   print
(1) A subsidy program operator or indirect subsidy program operator shall clarify the current value and valuation of any important property prescribed by Presidential Decree which is acquired with or the effectiveness of which increases through the subsidies or indirect subsidies (hereafter referred to as "important property" in this Article) , as prescribed by Presidential Decree and report the current status of such important property to the head of the relevant central government agency or the head of the relevant local government.
(2) The head of a central government agency or the head of a local government shall publicly announce the current status of important property reported by a subsidy program operator or indirect subsidy program operator pursuant to paragraph (1) , through computerized communications, etc. , as prescribed by Presidential Decree.
(3) No subsidy program operator or indirect subsidy program operator shall engage in any of the following activities in connection with important property without obtaining approval from the head of a central government agency, even after the completion of the relevant subsidy program: Provided, That where prescribed by Presidential Decree, he/she may engage in any of the following activities without obtaining approval from the head of the central government agency:
1. Use of important property for any purpose other than intended purposes of granting subsidies;
2. Transfer, exchange and lending of important property;
3. Provision of important property as security.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 36 (Inspections)   print
(1) When deemed necessary to appropriately implement subsidy budgets, the head of a central government agency may require the relevant subsidy program operator or indirect subsidy program operator to submit a report or order a public official under his/her jurisdiction to visit the relevant business office or place of business to inspect accounting books, other documents or related property, or question an interested person.
(2) Any public official who conducts an inspection or asks a question pursuant to paragraph (1) shall carry a certificate indicating his/her authority and produce it to an interested person.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 37 (Objections)   print
(1) If a subsidy program operator is dissatisfied with the decision to grant subsidies, details of the decision to grant subsidies, revocation of the decision to grant subsidies, or other dispositions the head of a central government agency has taken in relation to the granting of subsidies, he/she may file a written objection with the head of the relevant central government agency within 20 days after receipt of the notice or disposition.
(2) If the head of a central government agency receives an objection pursuant to paragraph (1) , he/she shall take necessary measures after hearing opinions of the relevant person, and notify the person who has filed the objection thereof. In such cases, if a person who has filed an objection against details of the decision to grant subsidies fails to express his/her consent to the measures within 20 days after receiving notification of the measures, he/she shall be deemed to withdraw his/her application for the granting of subsidies.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
law view
 Article 38 (Delegation of Duties)   print
Some duties of the head of a central government agency concerning the granting, management, etc. of subsidies may be delegated to the head of the government agency under his/her jurisdiction or to the head of the relevant local government, as prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
law view
 Article 39 (Provisions regarding Accounting Matters)   print
Articles 11 and 99 of the National Finance Act shall apply mutatis mutandis to the accounting of subsidies.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 39-2 (Monetary Rewards for Reporting)   print
(1) The head of a central government agency may pay a monetary reward, within budget limits, to a person who reports or accuses any of the following persons to the relevant administrative agency or investigative agency: Provided, That no monetary reward shall be paid to any public official who reports any of the following persons in connection with his/her duties:
1. A subsidy program operator who falls under Article 30 (1) ;
2. An indirect subsidy program operator who falls under Article 30 (2) ;
3. A subsidy recipient who falls under Article 33-2 (1) .
(2) Matters necessary for standards, procedures, etc. for the payment of monetary rewards under paragraph (1) shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 10898, Jul. 25, 2011]
CHAPTER VII PENAL PROVISIONS
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 Article 40 (Penal Provisions)   print
Any person who receives subsidies or indirect subsidies by filing a false application or by wrongful means or any person who knowingly grants subsidies or indirect subsidies shall be punished by imprisonment for not more than five years or by a fine not exceeding thirty million won.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
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 Article 41 (Penal Provisions)   print
Any person who uses subsidies or indirect subsidies for any other unspecified purpose, in violation of Article 22 shall be punished by imprisonment for not more than three years or by a fine not exceeding twenty million won.
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
law view
 Article 42 (Penal Provisions)   print
Any person who falls under any of the following subparagraphs shall be punished by a fine not exceeding ten million won:
1. Any person who changes the details of his/her subsidy program or transfers, suspends or terminates his/her subsidy program without obtaining approval from the head of the relevant central government agency, in violation of Article 23 or 24;
2. Any person who fails to keep relevant data, in violation of Article 25 (3);
3. Any person who violates a suspension order issued under Article 26 (2);
4. Any person who file a false report, in violation of Article 27 or 36 (1).
[This Article Wholly Amended by Act No. 10898, Jul. 25, 2011]
law view
 Article 43 (Joint Penal Provisions)   print
If the representatives of a corporation or an agent, employee or other servant of the corporation or an individual commits a violation under Articles 40 through 42 in connection with the business of such corporation or individual, not only shall such violator be punished, but the corporation or the individual also shall be punished by a fine under the relevant provisions: Provided, That the same shall not apply where such corporation or individual has not been negligent in giving due attention and supervision concerning the relevant duties to prevent such violation.
[This Article Wholly Amended by Act No. 9347, Jan. 30, 2009]
ADDENDA
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures)
With regard to the budgets compiled and confirmed before this Act enters into force, the amended provisions of Articles 19 (2) and 21 (3) shall not apply.
Article 3 (Temporary Special Cases for Subsidized Projects of Seoul Special Metropolitan City Mayor)
When a person who intends to implement a subsidized project is the Seoul Special Metropolitan City Mayor, the consultation with the Min- ister of Home Affairs held by the heads of the central government agen- cies under the amended provisions of Article 7 (2) shall be substituted by the report of the heads of the central government agencies to the Prime Minister, until the Seoul Special Metropolitan City Council is organized; both the submission of written opinions by the Minister of Home Affairs to the Minister of Finance and Economy and the heads of the related central government agencies pursuant to the amended provisions of Article 7 (2) and the notice given by the heads of the central government agencies to the Minister of Home Affairs pur- suant to the amended provisions of Articles 12 (2) and 19 (2) shall be waived until the Seoul Special Metropolitan City Council is organized.
Article 4 Omitted.
Article 5 (Relationship with other Acts)
If the provisions of the previous Subsidies Management Act are cited or applied mutatis mutandis in other Acts as at the time when this Act enters into force, the corresponding Articles and paragraphs of this Act shall be considered to be cited or applied mutatis mutandis in substitution of the previous provisions, when there exist in this Act provisions with corresponding contents.
ADDENDA <Act No. 4268, Dec. 27, 1990>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted. )
Articles 2 through 10 Omitted.
ADDENDUM <Act No. 5454, Dec. 13, 1997>
This Act shall enter into force on January 1, 1998. (Proviso Omitted. )
ADDENDA <Act No. 5982, May 24, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted. )
Articles 2 through 6 Omitted.
ADDENDA <Act No. 6400, Jan. 29, 2001>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted. )
Articles 2 through 4 Omitted.
ADDENDA <Act No. 8050, Oct. 4, 2006>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2007. (Proviso Omitted. )
Articles 2 through 12 Omitted.
ADDENDA <Act No. 8852, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted. )
Articles 2 through 7 Omitted.
ADDENDA <Act No. 9347, Jan. 30, 2009>
(1) (Enforcement Date) This Act shall enter into force three months after the date of its promulgation.
(2) (Applicability to Use of Surplus) The amended provisions of Article 31 (4) through (6) shall apply from the first subsidies granted in the fiscal year of 2009.
ADDENDA <Act No. 10898, Jul. 25, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation.
Article 2 (Applicability to Monitoring, etc. of Implementation of Subsidy Programs)
The amended provisions of Article 25 (3) shall apply from the first subsidy program operator or indirect subsidy program operator who commences his/her subsidy program or indirect subsidy programs after this Act enters into force.
Article 3 (Applicability to Return of Subsidies)
(1) The amended provisions of Article 31 (1) shall apply from the first subsidies, the decision to grant which is revoked after this Act enters into force.
(2) The amended provisions of Article 31 (2) shall apply from the final amount of subsidies that is determined under Article 28 after this Act enters into force.
Article 4 Omitted.
Article 5 (Relationship with other Acts and Subordinate Statutes)
A citation of the former Act on the Budgeting and Management of Subsidies or provisions thereof by any other Act or subordinate statute in force as at the time this Act enters into force shall be deemed a citation of this Act or the corresponding provisions thereof in lieu of the former provisions.