Enforcement Decree Of The Local Finance Act


Published: 2012-03-26

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CHAPTER I GENERAL PROVISIONS
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 Article 1 (Purpose)   print
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.
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 Article 2 (Classification of Fiscal Year to Which Annual Revenues Belong)   print
The fiscal year to which annual revenues belong shall be determined by the following classifications:
1. Revenues whose payment period is determined shall be the year to which the last day of the payment period belongs: Provided, That when the payment notice is not issued within the fiscal year to which the payment period belongs, it shall be the year to which the date when the payment notice is issued belongs;
2. Occasional revenues for which a payment notice is issued shall be the year to which the date when the payment notice is issued belongs: Provided, That occasional revenues that are revenues incidental to the basic revenues shall be the year to which the basic revenues belong;
3. Occasional revenues for which a payment notice is not issued shall be the year to which the date on which the occasional revenues are received: Provided, That local government bonds issued as securities, borrowings, charges, grants, subsidies, contributions, repayments and other revenues similar thereto shall be the year to which the budget belongs;
4. Occasional revenues that are received by the close-off deadline for receipts and disbursements pursuant to a contract shall be the year to which the date when such contract is concluded belongs, notwithstanding the provisions of subparagraphs 2 and 3.
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 Article 3 (Classification of Fiscal Year to Which Annual Expenditures Belong)   print
The fiscal year to which annual expenditures belong shall be determined according to the following classifications:
1. The principal and interest of local government bonds shall be the year to which the date on which their payments are made belongs;
2. All refunds, reserves for losses, repayments and others similar thereto shall be the year to which the date on which they are determined belongs;
3. Charges, grants, subsidies, contributions and others similar thereto shall be the year to which the budget for them belongs;
4. Reimbursements for actual expenses, salaries, travel expenses, fees and others similar thereto shall be the year to which the date on which the grounds for their payments accrue belongs;
5. Royalties, custody fees, electricity rates and others similar thereto shall be the year to which the period during which the grounds for their payments accrue belongs;
6. Construction works and manufacturing costs, goods procurement costs, transport costs and other costs similar thereto whose payments are made after the performance of other parties are completed shall be the year to which the date on which their payments are confirmed belongs: Provided, That the acts of other parties that are completed by the close-off deadline for receipts and disbursements shall be the year to which the date on which the act incurring expenditures is performed belongs;
7. Any matter that does not fall under any of subparagraphs 1 through 6 shall be the year to which the date on which the payment order is given belongs.
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 Article 4 (Time Limit for Adjusting Receipts and Disbursements)   print
Every public official in charge of expenditures shall complete the adjustment and disbursement of expenses or the refund of disbursed annual expenditures of each fiscal year and every treasurer shall complete the receipts or payments of annual revenues and expenditures of each fiscal year within the close-off deadline for receipts and disbursements provided for in Article 8 of the Local Finance Act (hereinafter referred to as the "Act"): Provided, That the amount of annual revenues that every treasurer receives shall revert to the depository (hereinafter referred to as the "depository") of the relevant local government on or before 10 days after the lapse of the close-off deadline for receipts and disbursements.
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 Article 5 (Completion of Clerical Work Involving Receipts and Disbursements)   print
Clerical work involving the receipt and disbursement of the annual revenues and expenditures that belong to the fiscal year shall be completed within 3 months after the relevant fiscal year ends.
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 Article 6 (Application of Matters concerning Education, Science and Physical Education, etc.)   print
With respect to matters concerning education, science and physical education or the special account for educational expenses in this Decree, the "head of local government" or a "Mayor/Do Governor or the head of a Si/Gun/autonomous Gu" shall each be deemed the "superintendent of the office of education", the "Minister of Public Administration and Security" shall be deemed the "Minister of Education, Science and Technology" and "Ordinance of the Ministry of Public Administration and Security" shall be deemed "Ordinance of the Ministry of Education, Science and Technology", respectively. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 7 (Types of Local Government Bonds)   print
The types of local government bonds prescribed by Article 11 (1) of the Act shall be as follows:
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.
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 Article 8 (Special Case concerning Local Government Bonds Issued as Securities)   print
(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.
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 Article 9 (Grounds for Issuing Local Government Bonds)   print
(1) In cases falling under any of the following subparagraphs, local government bonds may be issued pursuant to the provisions of Article 11 (1) and (4) of the Act:
1. Where official and public facilities are installed;
2. Where the profits derived from a project make it possible to repay the principal and interest therefor;
3. Where it becomes necessary to supplement an unanticipated shortfall in annual revenues incurred by any natural disaster;
4. Where a project needs to be undertaken in order to prevent any disaster and restore damage from such disaster;
5. Where it is necessary to repay local government bonds that have already been issued;
6. Where any project that is deemed necessary to foster the welfare, etc. of residents shall be undertaken;
(2) In cases falling under any of the following subparagraphs, local government bonds may be issued in excess of the limit of amount on the issuance of the local government bonds after obtaining approval therefor from the Minister of Public Administration and Security pursuant to the provisions of Article 11 (3) of the Act: <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
1. Where it becomes necessary to supplement an unanticipated shortfall in annual revenues incurred by any natural disaster;
2. Where a project needs to be undertaken in order to prevent any disaster or make restoration from damage;
3. Where it is deemed necessary to foster the welfare, etc. of residents.
(3) Even in cases referred to in paragraphs (1) and (2), when the total cost of the project falls short of the standards provided for in Article 41 (1) 1 (a) and 2 (a), the local government bonds are prohibited from being issued: Provided, That the same shall not apply to where any borrowing is made to raise funds for an office building upgrade.
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 Article 10 (Calculation, etc. of Limit of Amount for Issuance of Local Government Bonds)   print
(1) The limit of amount on the issuance of local government bonds under Article 11 (2) of the Act shall be the amount determined by the Minister of Public Administration and Security, taking into account the matters falling under each of the following subparagraphs within the scope of 10/100 of the budget amount of the relevant local government in the year before the preceding year: <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
1. The amount of local government bonds issued pursuant to Article 11 (1) of the Act: Provided, That any local government bond issued to raise funds for the community development under Article 19 of the Local Public Enterprises Act shall be excluded;
2. The amount any local government is liable to repay on the grounds of the debtor's bankruptcy, etc. from among the amount of the obligations borne for the guarantee under Article 13 of the Act;
3. The amount of the obligations borne, as provided for in Article 44 of the Act;
4. The financial situation, including the amount of obligations and the schedule for repaying the obligations, of the relevant local government.
(2) Notwithstanding paragraph (1), the Minister of Minister of Public Administration and Security may determine the additional amount limit on the issuance of local government bonds for a local government concerned, in addition to the amount limit on the issuance of local government bonds already determined pursuant to paragraph (1), if necessary for the smooth promotion of projects executed by administrative organs (limited to subordinate organs of the local government concerned) in a free economic zone established pursuant to Article 27-2 (1) of the Special Act on Designation and Management of Free Economic Zones. <Newly Inserted by Presidential Decree No. 20123, Jun. 28, 2007; Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 21656, Jul. 30, 2009>
(3) The Minister of Public Administration and Security may request the heads of local governments to furnish materials necessary to calculate the limit of amount for the issuance of local government bonds. In such cases, where any local government obtains an excessively high limit by submitting falsified materials or issues bonds in excess of the limit without obtaining approval therefor, the Minister of Public Administration and Security may reduce and adjust such limit in question or impose restrictions on the issuance of local government bonds. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 11 (Procedures for Issuing Local Government Bonds)   print
(1) The Minister of Public Administration and Security shall notify each local government of its limit of amount on the issuance of local government bonds of the following year on or before July 15 of each year. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) When the heads of local governments or the head of the Association of Local Governments intends to issue local government bonds in the following year after obtaining approval therefor from the Minister of Public Administration and Security pursuant to Article 11 (2) (proviso), (3) and (4) of the Act, they or he/she shall submit a draft plan for issuing its local government bonds for the following year, which is formulated according to the standards set by the Minister of Government Administration and Home Affairs, to the Minister of Public Administration and Security on or before August 31. In such cases, the draft plan for issuing local government bonds of a Si/Gun/autonomous Gu shall be submitted to the Minister of Public Administration and Security via a Special Metropolitan City Mayor, a Metropolitan City Mayor or a Do Governor (hereinafter referred to as a "Mayor/Do Governor"). <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(3) The Minister of Public Administration and Security shall determine whether to grant approval for the draft plan for issuing local government bonds under paragraph (2) after consulting with regard thereto with the heads of central administrative agencies concerned and notify local governments of the result of such decision on or before October 31. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(4) When the heads of local governments or the head of the Association of Local Governments intends to issue local government bonds in excess of the amount limit for the issuance of local government bonds during the fiscal year, they or he/she shall obtain separate approval therefor from the Minister of Public Administration and Security, notwithstanding paragraphs (2) and (3). <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 12 (Procedures for Acquiring Local Government Bonds)   print
(1) Where any local government intends to obtain borrowings in the following year from the special account, funds and office building upgrade funds, or similar from the central government, the local government shall submit a draft plan for issuing local government bonds for the following year, which is developed according to the standards set by the Minister of Public Administration and Security, to the Minister of Public Administration and Security on or before 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 Public Administration and Security via a Mayor/Do Governor. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) The Minister of Public Administration and Security shall consult with the heads of central administrative agencies or the head of the Association of Local Governments, etc. about the draft plan for issuing local government bonds under paragraph (1) and then notify the relevant local governments of the result of the consultations on or before October 31. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(3) When a Si/Gun/autonomous Gu intend 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, they shall submit a draft plan for issuing local government bonds for the following year according to the standards set by the Minister of Public Administration and Security, to a Mayor/Do Governor on or before July 31. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 13 (Local Government Bonds Issued as Securities by Means of Public Offering)   print
(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.
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 Article 14 (Special Case of Subscribing to Total Amount of Local Government Bonds Issued as Securities)   print
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.
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 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)   print
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.
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 Article 16 (Payments)   print
(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.
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 Article 17 (Issuance of Securities)   print
(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.
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 Article 18 (Issuance of Local Government Bonds Issued as Securities by Way of Sale)   print
When local governments issue local government bonds issued as securities by way of sale, they shall publish 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.
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 Article 19 (Special Case concerning Instance Where Total Sale Amount of Local Government Bonds Issued as Securities Falls Short of Total Amount)   print
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 published pursuant to the provisions of Article 18, when the completion of the sales of local government bonds issued as securities is explicitly published, the total amount of sales shall be deemed the total amount of relevant local government bonds issued as securities.
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 Article 20 (Conversion between Registered Securities and Non-Registered Securities)   print
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 in cases where securities are limited to registered securities or non-registered securities.
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 Article 21 (Ledger of Local Government Bonds Issued as Securities)   print
(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) Where non-registered securities are issued, the kinds and number of the securities, other than the matters provided for in the provisions of paragraph (2) 1 through 6 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.
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 Article 22 (Lottery Repayments of Local Government Bonds Issued as Securities)   print
(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 publish 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 publish 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).
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 Article 23 (Case of Deficiency in Right and Interest)   print
(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.
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 Article 24 (Special Case concerning Local Government Bonds Issued as Securities in Foreign Currency)   print
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 Acts and subordinate statutes or customs of the country where the local government bonds issued as securities are issued, notwithstanding the provisions of this Decree.
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 Article 25 (Methods of Publication)   print
Local government bonds issued as securities shall be published in the public gazette of the relevant local government or in daily newspapers.
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 Article 26 (Approval for and Management of Guaranteed Obligations)   print
(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.
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 Article 27 (Scope of Substitute Expenses for Revenues)   print
The substitute expenses for revenues under Article 16 of the Act shall be the expenses incurred in cases falling under any of the following subparagraphs, as determined by the Minister of Public Administration and Security: <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
1. Where any local government provides special services or facilities and collects expenses from the recipients of such services or facilities;
2. Where the total amount of related expenses can be disbursed within the scope of revenues;
3. Where expenses are disbursed within the scope of revenues for the expenses of experiment, practice and research that accrue revenues.
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 Article 28 (Disbursement of Substitute Expenses for Revenues in Excess of Budget)   print
When the head of any local government intends to disburse substitute expenses for revenues in excess of the budget pursuant to Article 16 (1) of the Act, he/she shall provide clear the grounds thereof and the amount.
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 Article 29 (Restrictions on Donation, Subsidization or Contribution)   print
(1) Deleted <by Presidential Decree No. 23121, Sep. 6, 2011>
(2) "Disbursement of other public funds" in the main sentence of Article 17 (1) of the Act means all financial expenditures, including contributions of any relevant local government, except the investment provided for in the provisions of Article 18 of the Act. <Amended by Presidential Decree No. 23121, Sep. 6, 2011>
(3) "Where it is deemed necessary to undertake projects recommended by local governments" in Article 17 (1) 4 of the Act refers to cases where it is impractical to undertake projects that are recommended by relevant local governments, relating to administrative affairs within the jurisdictions of such relevant local governments, without subsidization for such projects.
(4) Deleted <by Presidential Decree No. 23121, Sep. 6, 2011>
(5) Matters necessary for an application for subsidization or disbursement of other public funds by local governments pursuant to Article 17 (1) of the Act and a decision on such subsidization or disbursement, use of such subsidies or funds, etc. shall be prescribed by municipal ordinances of relevant local governments.
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 Article 30 (Scope of Public-Interest Corporations)   print
"Public-interest corporations whose members are local governments" in the main sentence of Article 17 (2) 2 of the Act means corporations established after obtaining authorization therefor from the Minister of Public Administration and Security 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, to upgrade public office buildings, to create and manage public property and to facilitate the international exchange programs of local governments, etc. <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 23121, Sep. 6, 2011>
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 Article 30-2 (Ex Post Facto Evaluation of Subsidized Projects)   print
(1) Pursuant to Article 17 (3) of the Act, the head of a local government shall annually conduct an ex post facto evaluation of a subsidized project.
(2) An ex post facto evaluation prescribed in paragraph (1) shall be include the evaluation of the performance of the relevant project and the necessity of maintaining a subsidized project, etc.
(3) The head of a local government shall reflect the results of an evaluation prescribed in paragraph (1) in the compilation of budget except in extenuating circumstances.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 30-3 (Examination, etc. of Progress of Subsidized Projects)   print
(1) A proprietor of a subsidized project (referring to a person who conducts a subsidized project upon receipt of subsidies granted pursuant to Article 17 (1) of the Act; hereafter the same shall apply) shall file a report on the progress of the subsidized project with the head of the relevant local government, as prescribed by the head of the relevant local government.
(2) The head of a local government may conduct an on-site inspection, where necessary to understand the progress of a subsidized project.
(3) The head of a local government may issue to a proprietor of a subsidized project an order necessary for the execution of the subsidized project, when he/she deems that the proprietor of the subsidized project fails to execute the subsidized project in accordance with Acts and subordinate statutes, details of a decision on subsidization, or a disposition made by the head of the local government pursuant to Acts and subordinate statutes.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 30-4 (Reporting on Performance and Settlement of Accounts of Subsidized Projects)   print
(1) When a subsidized project has been finished or suspended, or when a fiscal year ends, a proprietor of the subsidized project shall prepare a report on the performance of the subsidized project and submit it to the head of the relevant local government.
(2) Upon receipt of a report on the performance of a subsidized project from a proprietor of a subsidized project pursuant to paragraph (1), the head of a local government shall examine whether the performance of such subsidized project complies with Acts and subordinate statutes, details of a decision on subsidization, or a disposition made by the head of a local government pursuant to Acts and subordinate statutes. In such cases, he/she shall, where deemed necessary, conduct an on-site inspection.
(3) When the head of a local government deems that the performance of a subsidized project as a result of an examination conducted under paragraph (2) complies with the standards for an examination referred to in paragraph (2), he/she shall determine an amount of subsidy and notify a proprietor of such subsidized project thereof, and where an amount of subsidy already granted exceeds the amount determined, shall take measures to recover the excess.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 31 (Establishment, etc. of Advisory Councils by Field)   print
(1) The Minister of Public Administration and Security shall establish advisory councils by field pursuant to Article 19 of the Act. The advisory councils by field shall each be composed of not more than 10 members, including one chairperson, who are appointed or commissioned by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) The Advisory Council for Local Financial Policy shall be established within the Ministry of Public Administration and Security with the mandate to counsel the Minister of Public Administration and Security on the management of the finances of local governments and the Advisory Council for Local Financial Policy shall be composed of not more than 20 members, including one chairperson, who are appointed or commissioned by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(3) The advisory councils by field under paragraph (1) may each place matters concerning local finances on the agenda of the Advisory Council for Local Financial Policy under paragraph (2) for its deliberation.
(4) Detailed matters concerning the composition and operation of the advisory councils by field and the Advisory Council for Local Financial Policy under paragraphs (1) and (2) shall be prescribed by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
CHAPTER II BURDEN OF EXPENSES
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 Article 32 (Restrictions on Disbursement of Expenses)   print
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 Acts and subordinate statutes.
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 Article 33 (Items, etc. of Expenses Borne by Local Governments)   print
(1) The items and the rate of apportionment of the expenses to be borne by a Special Metropolitan City, a Metropolitan City and a Do (hereinafter referred to as a "City/Do") and a Si/Gun/autonomous Gu (excluding the amount that is appropriated from fiscal and financial funds of the State and other amounts that are borne by beneficiaries) pursuant to Article 22 (1) of the Act shall be determined by Ordinance of the Ministry of Public Administration and Security, taking into account the nature of the projects, scope of the effects of projects and the interests among the local governments on the relevant projects: Provided, That the same shall not apply to cases where other Acts and subordinate statutes prescribe otherwise. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) When 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 Public Administration and Security pursuant to paragraph (1) (hereinafter referred to as the "standard burden ratio"). <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 34 (Application for Subsidies)   print
When the heads of local governments each report the details of the application for earmarking subsidies from the National Treasury in the budget to the Minister of Public Administration and Security pursuant to Article 24 of the Act, they shall include materials and opinions that are submitted to the Minister of Strategy and Finance or the heads of central administrative agencies pursuant to Articles 8 and 11 of the Act on the Budgeting and Management of Subsidies in their respective reports. <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 21214, Dec. 31, 2008>
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 Article 35 (Composition of Committee for Deliberation on Local Financial Obligations)   print
(1) “The relevant central administrative agency prescribed by Presidential Decree” provided for in Article 27-2 (2) 1 of the Act means a central administrative agency that is related to an agenda proposed by the Committee for Deliberation on Local Financial Obligations (hereinafter referred to as the “Committee for Deliberation on Local Financial Obligations) referred to in paragraph (1) of the same Article, as designated by the chairperson of such Committee in advance every meeting.
(2) “Person prescribed by Presidential Decree” provided for in Article 27-2 (2) 3 of the Act means a person other than a public official (excluding a public educational official), as commissioned by the Minister of Public Administration and Security.
(3) The terms of office of members referred to in Article 27-2 (2) 2 and 3 of the Act shall be two years.
[This Article Wholly Amended by Presidential Decree No. 23753, Jan. 31, 2012]
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 Article 35-2 (Operation of the Committee for Deliberation on Local Financial Obligations)   print
(1) The chairperson of the Committee for Deliberation on Local Financial Obligations shall convene meetings thereof and preside at the meetings.
(2) When the chairperson of the Committee for Deliberation on Local Financial Obligations is not able to perform his/her duties due to extenuating grounds, a member of such committee designated by the chairperson in advance shall act on behalf of such chairperson.
(3) The attendance of a majority of the incumbent members of the Committee for Deliberation on Local Financial Obligations shall constitute a quorum for a meeting thereof, and all issues before such meeting shall be decided by a majority of such incumbent members present.
(4) Where the head of a local government presents opinions relating to the matters referred to in subparagraphs of Article 27-2 (1) of the Act, the Minister of Public Administration and Security may, where deemed necessary, convene the Committee for Deliberation on Local Financial Obligations to deliberate on such opinions.
(5) The chairperson of the Committee for Deliberation on Local Financial Obligations may, where deemed necessary for deliberation, hear opinions, requesting the relevant agency to provide data or present opinions, etc. necessary for such committee, or inviting the relevant public officials or private sector experts to attend the deliberation.
(6) The Minister of Public Administration and Security shall immediately notify the head of each central administrative agency and each local government of the matters decided by the Committee for Deliberation on Local Financial Obligations and take measures necessary for such central administrative agency and local government.
(7) Matters necessary for the composition and operation of the Committee for Deliberation on Local Financial Obligations, except as provided by this Decree, shall be prescribed by the Minister of Public Administration and Security.
[This Article Newly Inserted by Presidential Decree No. 23753, Jan. 31, 2012]
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 Article 35-3 (Restrictions of Local Tax Reduction and Exemption)   print
(1) Pursuant to Article 28-2 (1) of the Act, the Minister of Public Administration and Security shall endeavor that the ratio (hereinafter referred to as “rate of the aggregate amount of local taxes that are non-taxable, exempt and reduced in this Article) of the aggregate amount of local taxes that are non-taxable, reduced and exempt to the sum of local taxes collected at settlement, and local taxes that are non-taxable, reduced and/or exempt for the relevant year shall be not more than 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 treated as zero:
1. By the year 2015: 15/100;
2. The year 2016: A ratio calculated by adding 5/1,000 to a rate of the aggregate amount of local taxes that are non-taxable, reduced and exempt for the year 2015;
3. The year 2017: A ratio calculated by adding 5/1,000 to an average rate of the aggregate amount of local taxes that are non-taxable, reduced and exempt for the years from 2015 to 2016;
4. From the year 2018 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 and/or exempt for three years immediately preceeding the relevant year.
(2) When calculating the rate of the aggregate amount of local taxes that are non-taxable, reduced and exempt referred to in subparagraphs of paragraph (1), the following amounts shall not be included in local taxes that are non-taxable, reduced and exempt:
An amount of acquisition tax reduced and exempt referred to in Article 40-2 of the Restriction of Special Local Taxation Act (applicable only where the amount of acquisition tax reduced and exempt exceeds an amount of 3,477.5 billion won reduced from acquisition tax at settlement for the year 2010);
Local taxes that are non-taxable, reduced and exempt, which temporarily arise due to extenuating circumstances for rendering support under a national policy, including tax reduction and exemption to support an Agricultural cooperative’s business restructuring referred to in Article 57 (3) of the Restriction of Special Local Taxation Act.
[This Article Newly Inserted by Presidential Decree No. 23753, Jan. 31, 2012]
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 Article 36 (Types and Distribution of Financial Supplements)   print
(1) The types of financial supplements provided for in Article 29 of the Act shall be categorized into the amount paid to supplement the financial resources necessary to operate the administration of a Si/Gun (hereinafter referred to as a "general financial supplement"), the supplement paid to support the community development projects and policy measures of a Si/Gun (hereinafter referred to as a "supplement for implementing policy measures") and the supplement paid to supplement financial deficiencies for a Si/Gun to which the general subsidy tax provided for in Article 6 (1) of the Local Subsidy Act is not levied (hereinafter referred to as the "special financial supplement").
(2) The financial resources of the general financial supplement shall be an amount equivalent to 90/100 of the total amount of the financial supplement, the financial resources of the supplement for implementing policy measures shall be an amount equivalent to 10/100 of the total amount of the financial supplement, the financial resources of the special financial supplement shall be part of the general financial supplement and in the case of Gyeonggi-do, the financial resources of supplements shall be an amount equivalent to 25/100 of the general financial supplement and in the cases of a Metropolitan City and a Do, except Gyeonggi-do, shall be the amount equivalent to the ratio that is set by Municipal Ordinance of a City/Do within the scope prescribed by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(3) In the distribution of general financial supplements, an amount equivalent to 50/100 of the total amount obtained by deducting special financial supplements calculated pursuant to paragraph (2) from the total amount of general financial supplements shall be distributed according to the size of the population of a relevant Si/Gun, an amount equivalent to 40/100 shall be distributed according to the collection records of the Metropolitan City tax and a Do tax of the relevant Si/Gun, an amount equivalent to 10/100 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 the financial independence index of which is less than one, and special financial supplements shall be distributed in proportion to the amount of financial deficiency of the relevant Si/Gun after first making up for 70 percent of the amount of financial deficiency of the Si/Gun whose population is less than two hundred thousand. <Amended by Presidential Decree No. 19735, Nov. 23, 2006>
(4) Specific standards for distributing, methods of calculation and the timing for distributing general financial supplements, supplements for implementing policy measures and special financial supplements, etc. shall be prescribed by Municipal Ordinance of a City/Do.
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 Article 37 (Adjustment of Expenses Borne by Si/Gun/Autonomous Gu)   print
When any balance accrues from the disbursement of costs borne by the Si/Gun/autonomous Gu for undertaking civil engineering works and other construction projects that are undertaken pursuant to Article 30 (1) of the Act, the City/Do shall adjust and then refund such balance to a relevant Si/Gun/autonomous Gu.
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 Article 38 (Opinions Put Forward about Standard Burden Ratio)   print
(1) When the head of each local government is dissatisfied with the standard burden ratio applied to his/her local government pursuant to the provisions of Article 33, he/she may put forward his/her opinion accompanied by necessary materials to the Minister of Public Administration and Security. In such cases, a Si/Gun/autonomous Gu shall put forward its opinion accompanied by necessary materials with the opinions of a Mayor/Do Governor. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) When the Minister of Public Administration and Security recognizes that the opinion put forward 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 by Presidential Decree No. 20741, Feb. 29, 2008>
CHAPTER III BUDGET
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 Article 39 (Consultations about Developing Medium-Term Local Finance Plan)   print
Where it is necessary to take measures, including financial assistance, etc. when the Minister of Public Administration and Security develops the medium-term local financial plan under Article 33 (3) of the Act, he/she shall request the Minister of Strategy and Finance for consultations with regard thereto on or before May 31 of the preceding year after consulting the heads of central administrative agencies with regard thereto. <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 21214, Dec. 31, 2008>
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 Article 40 (Scope of Expenses Operated as Off-Budget Annual Revenues and Expenditure)   print
(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 Acts;
4. Expenses that are temporarily reserved by any local government to meet the need to perform clerical work.
(2) 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 except where this Decree or other Acts and subordinate statutes prescribe otherwise.
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 Article 40-2 (Details of Gender-Sensitive Budget and Standards for Preparation thereof)   print
(1) The gender-sensitive budget prescribed in Article 36-2 of the Act (hereinafter referred to as “gender-sensitive budget”) shall include the following details:
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 Public Administration and Security.
(2) The gender-sensitive budget shall be prepared in accordance with the standards for preparation and methods, etc. prescribed by the Minister of Public Administration and Security after consultation with the Minister of Gender Equality and Family.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 41 (Examination of Financial Investment and Loan Projects)   print
(1) The heads of local governments shall examine the following investment and loan projects as provided for in Article 37 of the Act (hereinafter referred to as "investment examination"): Provided, That the same shall not apply to any project for restoration, such as full recovery from any disaster, etc. and any other projects prescribed by Ordinance of the Ministry of Public Administration and Security: <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 21801, Nov. 2, 2009; Presidential Decree No. 22532, Dec. 20, 2010; Presidential Decree No. 23121, Sep. 6, 2011>
1. A City/Do: Projects that fall under any of the following items:
(a) New investment and loan projects, each of which amounts to not less than four billion won for a total project cost;
(b) New investment and loan projects, each of which amounts to not less than one billion won for a total project cost and includes any foreign loan project or foreign investment project and any investment and loan project that is jointly undertaken by any other City/Do;
(c) New investment and loan projects, each of which amounts to not less than 500 million won for a total project cost and includes any event project including performances and festivals, or any public relation project;
2. A Si/Gun/autonomous Gu: Projects that fall under any of the following items:
(a) New investment and loan projects, each of which amounts to not less than two billion won for a total project cost;
(b) New investment and loan projects, each of which amounts to not less than 500 million won for a total project cost and includes any foreign loan project or foreign investment project and any investment and loan project that is jointly undertaken by any other Si/Gun/autonomous Gu;
(c) New investment and loan projects, each of which amounts to not less than 300 million won for a total project cost and includes any event project including performances and festivals, or any public relation project;
(2) Where a new investment and loan project involves a total cost of not less than 50 billion won, the head of the relevant local government shall commission a specialized institution in the fields of administration and finances of local governments to conduct a feasibility study on the new investment and loan project before the investment examination referred to in paragraph (1) is conducted. In such cases, where the construction project for official or public buildings, including office buildings, citizen halls and Gu citizen halls, costs not less than ten billion won (excluding various incidental expenses, including land purchase expenses and design service expenses, among project costs required), a specialized institution prescribed and publicly announced by the Minister of Public Administration and Security shall be commissioned to conduct the feasibility study on such construction project. <Amended by Presidential Decree No. 21495, May 21, 2009>
(3) The head of a local government may omit a feasibility study referred to in paragraph (2) on any new investment and loan project on which a preliminary feasibility study has been conducted pursuant to Article 38 of the National Finance Act, notwithstanding paragraph (2). <Newly Inserted by Presidential Decree No. 22532, Dec. 20, 2010>
(4) The Minister of Public Administration and Security and a Mayor/Do Governor shall take measures, including training, necessary for improving the investment examination capabilities of local governments, and the Minister of Public Administration and Security or a Mayor/Do Governor may, upon the request from the heads of local governments, perform the investment examination on investment and loan projects larger than the scale prescribed by Ordinance of the Ministry of Public Administration and Security, and present their opinions thereon. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(5) When the heads of local governments intend to commission the investment examination on any investment and loan project as provided for in paragraph (4) on which the feasibility study under paragraph (2) or the preliminary feasibility study under paragraph (3) has been conducted, they shall submit documents, including the results of the feasibility study or preliminary feasibility study conducted pursuant to paragraph (2) or (3) respectively and whether such results are reflected, and, if such results are not reflected, documents explaining reasons why such results are not reflected. <Amended by Presidential Decree No. 22532, Dec. 20, 2010>
(6) Standards for conducting investment examinations and other matters necessary for conducting investment examinations shall be prescribed by Ordinance of the Ministry of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 42 (Compilation of Budgets)   print
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 for in Articles 38 (2) and 41 of the Act, except where the provisions of other Acts and subordinate statutes prescribe otherwise.
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 Article 43 Deleted. <by Presidential Decree No. 21087, Oct. 20, 2008>   print
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 Article 44 (Establishment of Local Investment Examination Committee)   print
(1) Each local government shall establish a Local Investment Examination Committee under the head of each local government with the mandate to counsel the head of each local government regarding the investment examination under Article 41 (1), (2) and (4): Provided, That if another committee appropriate for taking charge of the functions of the Investment Examination Committee exists, and members of the committee have knowledge or expertise in local finance or investment examination, the committee may act for the Investment Examination Committee, as stipulated by municipal ordinances of respective local governments. <Amended by Presidential Decree No. 21495, May 21, 2009; Presidential Decree No. 22532, Dec. 20, 2010>
(2) The Local Investment Examination Committee shall be composed of not more than 15 members, and detailed matters concerning its operation, etc. shall be prescribed by the head of the relevant local government.
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 Article 45 (Documents to Accompany Budget Bill)   print
The budget bill to be submitted to the local council shall be accompanied by documents falling under each of the following subparagraphs: Provided, That where any revised budget bill or any revised supplementary budget bill is submitted to the local council, all or some of the accompanying documents may be omitted: <Amended by Presidential Decree No. 20504, Dec. 31, 2007; Presidential Decree No. 23121, Sep. 6, 2011>
1. The standards for compiling the budgets of local governments prescribed by Article 38 (2) of the Act;
2. A statement of the budgets of annual revenues and expenditures;
3. An explanation pertaining to incurring obligations;
4. An explanation pertaining to the specified carryover expenses;
5. 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 annual revenues and expenditures of the preceding year;
6. A written statement pertaining to issuance and repayment record of the local government bonds issued as securities and borrowings as at the end of the year before the preceding year, an estimate of the current amount of local government bonds issued as securities and borrowings as at the end of the preceding year and the relevant year, and the annual repayment plan;
7. A written statement pertaining to an estimate of the current amount of pubic properties as at the end of the year before the preceding year, and an estimate of the current amount thereof as at the end of the preceding and the relevant year;
8. With respect to the act of incurring obligations extending to the following year and thereafter, a written statement pertaining to the disbursed amount or the estimated disbursed amount as at the end of the preceding year and the amount planned to be disbursed after the relevant year;
9. A written statement pertaining to the disbursed amount or the estimated disbursed amount of the continuing expenses as at the end of the preceding year, the amount planned to be disbursed after the relevant year and a plan for and the current progress of all projects;
10. A table of the number of regular personnel by type of occupation and a comparison table of the number of regular personnel of the preceding year;
11. The financial plan of the local government;
12. A report on local tax expenditures provided for in Article 5 (1) of the Restriction of Special Local Taxation Act;
13. Other documents that are necessary to clarify the details of budget.
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 Article 46 (Procedures for Residents to Participate in Process of Compiling Budgets of Local Governments)   print
(1) Residents may participate in the process of compiling budgets of local governments under Article 39 of the Act in a manner falling under any of the following subparagraphs:
1. Public hearings or informal gatherings for discussion of major projects;
2. Written or Internet question surveys on major projects;
3. The public offering of projects;
4. Other means to appropriately solicit the opinions of residents, as prescribed by Municipal Ordinance.
(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.
(3) Specific matters concerning the scope of the compilation of budgets in which residents participate, procedures and means, etc. for collecting the opinions of residents and the management of the collected opinions of residents shall be prescribed by Municipal Ordinance of each local government.
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 Article 47 (Classification of Budget Items)   print
(1) The budget items of annual revenues shall be classified into local tax revenues, non-tax revenues, local subsidy taxes, adjusted subsidies, financial supplements, subsidies, local government bonds and the retrieval of deposit money, etc., taking into account the sources of annual revenues.
(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 by Presidential Decree No. 20504, Dec. 31, 2007>
(3) Detailed matters concerning the classification of the budget items of annual revenues and the budget items of annual expenditures shall be prescribed by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 48 (Restrictions on Spending of Reserve Funds)   print
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.
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 Article 49 (Grounds for Incurring Obligations and Amount Thereof)   print
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.
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 Article 50 (Requirements for Reducing Expenditures and Increasing Revenues)   print
(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.
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 Article 51 (Standards for Paying Budgetary Performance Bonuses)   print
(1) The budgetary performance bonuses on the reduced expenditure provided for in Article 48 (1) of the Act shall be paid to persons who have contributed to the reduced expenditure within the scope falling under each of the following subparagraphs 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 provided for in the provisions of 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 the scope of 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 the case of 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 the scope of 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 the "subsidiary institution, etc.") that is prescribed by Ordinance of the Ministry of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 52 (Ex Post Facto Budgetary Measures, etc.)   print
(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 rel evant 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.
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 Article 53 (Provisions Governing Payment and Operation of Budgetary Performance Bonuses)   print
Necessary matters concerning the payment and operation of the budgetary performance bonuses shall be prescribed by Ordinance of the Ministry of Public Administration and Security except as prescribed in this Decree. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 54 (Establishment of Budgetary Performance Bonus Examination Committee)   print
(1) Each local government shall establish the Budgetary Performance Bonus Examination Committee under the jurisdiction of the head of the relevant local government in order to examine the payment, etc. of the budgetary performance bonuses provided for in Article 48 (2) of the Act.
(2) The Budgetary Performance Bonus Examination Committee referred to in paragraph (1) shall be composed of not more than ten members, including one chairperson and one vice chairperson. The chairperson shall be the vice head of the relevant 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) Necessary matters concerning the operation, etc. of the Budgetary Performance Bonus Examination Committee shall be prescribed by Ordinance of the Ministry of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 54-2 (Resident Supervision relating to Illegal Expenditure and Waste of Budget and Funds)   print
(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 shall 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).
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 55 (Conversion of Budget)   print
(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 by Presidential Decree No. 20445, Dec. 13, 2007; Presidential Decree No. 23121, Sep. 6, 2011>
1. Personnel expenses (including the total amount of personal expenses prescribed by the Regulations on Administrative Organizations of Local Governments and the Standards for the Fixed Number of their Regular Personnel, etc.);
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.
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 Article 56 (Plan for Allotting Budget)   print
(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 s pecified 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.
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 Article 57 (Budget Allotment Prior to Commencement of Fiscal Year)   print
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 by Presidential Decree No. 20504, Dec. 31, 2007>
1. Expenses incurred in areas in which traffic and communication are inconvenient;
2. Travel expenses;
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.
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 Article 58 (Carryover of Budget of Annual Expenditures)   print
(1) "Costs prescribed by Presidential Decree" in Article 50 (2) 2 of the Act means the costs falling under the following subparagraphs: <Amended by Presidential Decree No. 20504, Dec. 31, 2007>
1. Costs incurred in construction work preformed by means of the prior examination of bidding qualifications under Article 14 of the Enforcement Decree of the Act on Contracts to which a Local Government is a Party;
2. Costs disbursed under contracts concluded through negotiations pursuant to Articles 43 and 44 of the Enforcement Decree of the Act on Contracts to which a Local Government is a Party;
4. Costs incurred to make full recovery from disasters.
(2) The term "expenses prescribed by Presidential Decree" in Article 50 (2) 3 of the Act means the expenses falling under the following subparagraphs:
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) The term "expenses prescribed by Presidential Decree" in Article 50 (2) 4 of the Act means the expenses prescribed by Municipal Ordinances of local governments as expenses incurred to maintain and operate institutions and facilities. In such cases, the carryover-limit shall be 5/100 of the budget of the relevant expenses.
CHAPTER IV ACCOUNT SETTLEMENT
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 Article 59 (Submission of Written Account Settlement of Annual Revenues and Expenditure, etc.)   print
(1) The head of each local government shall submit to the local council a written account settlement of annual revenues and expenditure prepared pursuant to Article 51 of the Act, accompanied by the written opinions of the inspectors prescribed by Article 125 (1) of the Local Autonomy Act each fiscal year, by the end of June of the following fiscal year.
(2) The written account settlement of annual revenues and expenditures that is submitted to the local council shall be accompanied by a report on account settlement of annual revenues and expenditures, a report on account settlement of continuing expenses, a report on claims and obligations of relevant local government and a financial report provided for in Article 53 (1) of the Act.
(3) The report on account settlement of continuing expenses referred to in paragraph (2) shall be accompanied by the report on the account settlement of annual revenues and expenditure of the year to which the last disbursement of the annual amount of continuing expenses belongs.
(4) Standards for compiling the account settlement of local governments shall be set by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 60 (Disposal of Surpluses Accruing from Account Settlement)   print
Where any surplus accrues as a result of the account settlement of each fiscal year, the heads of local governments shall transfer such surplus to the annual revenues of the following year after deducting the amount provided for in each subparagraph of Article 52 of the Act, and the amount equivalent to that spent to repay local government bonds issued as securities, or borrowings. The whole or part of such surplus may be transferred to any property or any fund under the conditions prescribed by Municipal Ordinances.
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 Article 61 (Transfer Prior to Account Settlement of Annual Surplus)   print
With respect to any surplus that accrues after appropriating the annual revenues receipts of the preceeding year that is confirmed as obligations, and the financial resources for repaying the amount provided for in each subparagraph of Article 52 of the Act, local government bonds issued as securities, or borrowings from among the surpluses that accrue as a result of the account settlement of each fiscal year, the heads of local governments may transfer such surplus to the annual revenues of the relevant year, only when it is inevitable due to fund availability issues after the commencement of the relevant fiscal year, even prior to the account settlement of the annual revenues and expenditures of the preceding year, notwithstanding Article 60.
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 Article 62 (Accounting Standards for Local Governments)   print
(1) The details falling under each of the following subparagraphs shall be included in the accounting standards of the local governments provided for in Article 53 (1) of the Act in order to ensure fairness in accounting treatment and financial reports:
1. The recognition of assets, obligations and net assets;
2. The recognition of profits and costs;
3. The appraisal of assets and liabilities;
4. The standards for preparing financial reports;
5. The form of financial statements;
6. Other necessary matters concerning accounting performance and financial reports.
(2) The general assessment of the account settlement, the financial statements (including annotations thereto) and essential and supplementary information shall be included in the financial reports referred to in paragraph (1) 4.
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 Article 63 (Examination Opinions of Certified Public Accountants)   print
(1) The subject matter for examinations, the standards for performing such examinations and the fairness of financial reports, etc. shall be included in the examination opinions of certified public accountants prescribed by Article 53 (2) of the Act.
(2) Detailed matters concerning the preparation of examination opinions shall be determined by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 63-2 (Details of Gender-Sensitive Settlement of Accounts and Standards for Preparation thereof)   print
(1) The gender-sensitive settlement of accounts referred to in to Article 53-2 of the Act (hereinafter referred to as “gender-sensitive settlement of accounts”) shall include the following details:
1. Outline of the gender-sensitive settlement of accounts;
2. Results of the gender-sensitive budget executed;
3. Analysis on and evaluation of gender equality effects;
4. Other matters prescribed by the Minister of Public Administration and Security.
(2) The gender-sensitive settlement of accounts shall be prepared in accordance with the standards for preparation and methods, etc. prescribed by the Minister of Public Administration and Security after consultation with the Minister of Gender Equality and Family.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
CHAPTER V FINANCIAL ANALYSIS AND PUBLICATION
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 Article 64 (Report on Financial Operation)   print
(1) The financial reports required to be made by the head of each local government pursuant to Article 54 of the Act shall be as follows: <Amended by Presidential Decree No. 23121, Sep. 6, 2011>
1. The budget report referred to in Article 133 (2) of the Local Autonomy Act;
2. The report on the approval of the account settlement referred to in Article 134 (2) of the Local Autonomy Act;
3. The report on the issuance of local government bonds provided for in Article 11 of the Act;
4. The report on the act of incurring guaranteed obligations provided for in Article 13 of the Act;
5. The report on the investment provided for in Article 18 of the Act;
6. The report on the incurring of expenses for local governments provided for in Articles 21 and 23 of the Act;
7. The report on the medium-term local finance plan provided for in Article 33 of the Act;
8. The report on the results of the examination of the financial investment and loan project plan provided for in Article 37 of the Act;
9. The report on the act of incurring obligations provided for in Article 44 of the Act;
10. The financial report provided for in Article 53 of the Act;
11. The report on the current management of claims provided for in Article 85 of the Act;
12. The plan on funds management and the report on the account settlement of the funds provided for in Article 8 of the Framework Act on the Management of Local Government Funds;
13. Other reports on important matters that are deemed necessary to formulate and appropriately administer policies for the finances of local governments.
(2) The form of the financial reports, the report deadline and other necessary matters concerning such reports shall be determined by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 65 (Financial Analysis and Diagnosis, etc.)   print
(1) The Minister of Public Administration and Security shall conduct financial analysis and diagnosis under Article 55 of the Act (hereinafter referred to as “financial analysis and diagnosis”) every year and matters necessary for procedures and methods for financial analysis and diagnosis shall be determined by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) Where any local government falls under any of the following subparagraphs as a result of analysis on details of financial reports, the Minister of Public Administration and Security shall conduct financial diagnosis of the relevant local government: <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 23121, Sep. 6, 2011>
1. Where the debt ratio of the budget of annual revenues is in excess of the ratio of the budget of annual revenues set by the Minister of Public Administration and Security, or the balance of obligations is excessively high;
2. Where the record of annual revenues is found to be far lower than the budget amount as a result of the account settlement, or the revenues of the following year are brought forward for appropriation and expenditure;
3. Where the budget ratio of ordinary expenses, including personnel expenses, is high, substantially deteriorating the soundness of financial operations;
4. Where the Minister of Public Administration and Security deems it necessary for conducting financial diagnosis due to a substantial lack of financial soundness, efficiency, etc. as a result of analysis on financial reports.
(3) The Minister of Public Administration and Security may commission any relevant specialized institutions to conduct financial analysis and diagnosis in order to ensure the objectivity and expertise of such financial analysis and diagnosis. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(4) Where it is deemed necessary as a result of financial diagnosis provided for in paragraph (2), the Minister of Public Administration and Security may require any relevant local government to establish and implement a plan for improving the financial soundness of the relevant local government, aimed at restructuring the organization, repaying obligations, boosting annual revenues and restricting new projects, etc. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(5) Where a plan for the financial soundness of the relevant local government is judged to be inadequate as a result of an assessment of its implementation, the Minister of Public Administration and Security may publish the result of the assessment of such implementation or recommend matters necessary to improve the financial soundness. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 65-2 (Designation Criteria and Procedures, etc. for Organizations in Financial Crisis)   print
(1) Pursuant to Article 55-2 of the Act, the Minister of Public Administration and Security may designate any local government as an organization in financial crisis, where its financial crisis is judged as being serious and where any of the following arises:
The deficit ratio of the local government’s fiscal balance exceeds 30 percent thereof;
2. The total sum of an amount borne by the local government to assume responsibility for fulfilling its liabilities, among the amount consisting of an amount of municipal bonds issued pursuant to Article 11 of the Act and an amount caused by an act of burdening the local government with surety liabilities referred to in Article 13 of the Act, and an amount caused by an act of burdening the local government with liabilities referred to in Article 44 of the Act, exceeds 40 percent of the local government’s final budget amount for the relevant year;
3. The average amount of net expenditures borne by the local government in an amount of redemption of liabilities for the period of the past four years and the next four years, as of the relevant year, exceeds 17 percent of the average amount of ordinary revenue (referring to the total sum of local tax, non-tax revenue, local subsidy, subsidy for adjustment and financial offset, excluding local education tax) for the same period. In such cases, the amount of ordinary revenue for the next four years shall be calculated by multiplying the amount of ordinary revenue for the immediately preceeding year by the averaged growth rate of ordinary revenue for the past four years;
4. The amount of local tax accumulated and collected on a quarterly basis (referring to the actual cumulative amount of local taxes collected, excluding a refund of an overpayment or erroneous payment) becomes a negative value;
5. The total balance of a depository belonging to the local government for each quarter of the relevant year is less than ten percent of the average of total balance of the depository for the relevant quarter for the recent three years;
6. The debt amount of a local public corporation established under Article 49 of the Local Public Enterprises Act exceeds six times the net asset thereof.
(2) Where the Minister of Public Administration and Security designates a local government as an organization in financial crisis, he/she shall designate it after deliberation by the Local Financial Crisis Management Committee prescribed in Article 56 of the Act.
(3) Where reasons for designating a local government as an organization in financial crisis pursuant to paragraph (1) cease to exist, the Minister of Public Administration and Security may revoke such designation after deliberation by the Local Financial Crisis Management Committee prescribed in Article 56 of the Act.
(4) Where the Minister of Public Administration and Security designates a local government as an organization in financial crisis or revokes such designation, he/she may, where necessary, conduct a paper review or an on-site inspection, etc.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 65-3 (Submission Deadline for Plan for Financial Soundness, etc.)   print
(1) The head (hereinafter referred to as the “head of an organization in financial crisis) of a local government designated as an organization in financial crisis pursuant to Article 55-2 (1) of the Act shall establish a plan for improving financial soundness provided for in Article 55-3 (1) of the Act within 60 days from the date on which the local government is designated as the organization in financial crisis, and then shall submit the plan to the Minister of Public Administration and Security.
(2) After obtaining approval by the Minister of Public Administration and Security referred to in Article 55-3 (1) of the Act, the head of an organization in financial crisis shall, without delay, forward a plan for financial soundness to the relevant local council and propose a resolution on the plan by such council.
(3) Where the head of an organization in financial crisis intends to revise a plan for financial soundness, he/she shall require a resolution on the plan by the relevant local council after obtaining approval by the Minister of Public Administration and Security.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 65-4 (Restrictions on Compiling Budgets for Financial Investment and Loan Projects)   print
“Financial investment and loan projects, the scales of which are higher than those determined by Presidential Decree” prescribed in Article 55-4 (2) of the Act means financial investment and loan projects classified as follows:
A City/Do: New investment and loan projects, each of which amounts to not less than four billion won for a total project cost;
A Si/Gun/autonomous Gu: New investment and loan projects, each of which amounts to not less than two billion won for a total project cost.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
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 Article 66 (Composition and Operation, etc. of Local Financial Crisis Management Committee)   print
(1) The Local Financial Crisis Management Committee provided for in Article 56 of the Act (hereinafter referred to as the “Local Financial Crisis Management Committee”) shall consist of not more than 15 members, including one chairperson. <Amended by Presidential Decree No. 23121, Sep. 6, 2011>
(2) The chairperson of the Local Financial Crisis Management Committee shall be served by the Vice Minister Ⅱ of the Minister of Public Administration and Security, and such committee members shall be appointed or commissioned by the Minister of Public Administration and Security from among the following persons: <Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011>
1. Public officials who belong to senior public officials under the jurisdictions of related administrative agencies including the Ministry of Strategy and Finance, Ministry of Public Administration and Security, and Prime Minister’s Office;
2. Persons who have abundant knowledge and experience in local finance, tax systems, accounting, public corporations and other related fields.
(3) The terms of office of commissioned members of the Local Financial Crisis Management Committee shall be two years, and such commissioned members may be re-appointed only once to a consecutive term of office: Provided, where a member of such committee is newly commissioned, due to reasons such as the resignation of a commissioned member, the newly commissioned member shall serve the remaining period of his/her predecessor’s term of office. <Amended by Presidential Decree No. 23121, Sep. 6, 2011>
(4) The Local Financial Crisis Management Committee shall hold a meeting with the attendance of a majority of its incumbent members and adopt a resolution by an affirmative vote of a majority of those present. <Amended by Presidential Decree No. 23121, Sep. 6, 2011>
(5) The Local Financial Crisis Management Committee shall deliberate on the following matters: <Amended by Presidential Decree No. 23121, Sep. 6, 2011>
1. Matters concerning financial analysis and diagnosis provided for in Article 55 of the Act;
2. Matters concerning designating a local government as an organization in financial crisis provided for in Article 55-2 of the Act;
3. Matters concerning revoking the designation of a local government as an organization in financial crisis referred to in Article 65-2 (3);
4. Matters concerning approval for a plan for improving financial soundness of an organization in financial crisis referred to in Article 55-3 (1) of the Act;
5. Matters concerning disadvantaging a local government that yields remarkably poor results in the establishment and implementation of a plan for improving financial soundness referred to in Article 55-5 of the Act;
6. Other matters deemed necessary on which deliberation is requested by the Minister of Public Administration and Security to improve local financial soundness and efficiency.
(6) Other necessary matters for the composition and operation, etc. of the Local Financial Crisis Management Committee shall be determined by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 23121, Sep. 6, 2011>
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 Article 67 (Publication of Integrated Financial Information)   print
The Minister of Public Administration and Security may comprehensively analyze the integrated 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 not less than once annually. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 68 (Means of Publishing Current Operation of Finances)   print
(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 shall be as follows: <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 23121, Sep. 6, 2011>
1. The matters provided for in Article 60 (1) 1 through 8 of the Act;
2. The results of the analysis and examination of local government finances;
3. The results of audits conducted by the Board of Audit and Inspection and other audit institutions;
4. Other matters concerning the general operation of the finances prescribed by the Minister of Public Administration and Security, as deemed necessary to be disclosed to residents.
(3) The matters subject to special publication shall be prescribed by the Committee for the Deliberation on the Publication of Local Government Finances provided for in Article 70.
(4) The publication under paragraph (1) shall be made on the Internet home page of the relevant local government, and any daily newspapers, etc. that are circulated in the relevant area.
(5) Necessary matters concerning the forms and means of preparing such publication shall be determined by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 69 (Timing for Publishing Current Operation of Finances)   print
(1) The head of each local government shall make the publication provided for in Article 60 (2) of the Act in August of each year.
(2) Where the head of each local government operates the working budget due to a deficit in annual revenues, brings forward the appropriation, spending, etc. of the revenues of the following year on the grounds of a deficit in the annual revenues or faces the accrual of a new demand for finances, he/she may frequently publish the current operational status of the finances.
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 Article 70 (Establishment, etc. of Committee for Deliberation on Publication of Local Government Finances)   print
(1) The heads of local governments shall each establish a Committee for the Deliberation on the Publication of Local Government Finances (hereafter referred to as a "Publication Deliberation Committee" in this Article) with the mandate to deliberate on matters concerning the publication of the current operational status of the finances provided for in Article 60 (2) of the Act.
(2) The Publication Deliberation Committee shall be composed of not more than 15 members who are specialized in the relevant area, including one chairperson.
(3) Matters concerning the composition, operation, etc. of the Publication Deliberation Committee shall be prescribed by Municipal Ordinance of each local government.
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 Article 71 (Report on Current Operation of Finances)   print
The heads of local governments shall each publish the current operational status of their finances and then make a report thereon to the Minister of Public Administration and Security within ten days from the date on which such publication is made. In such cases, the head of a Si/Gun/autonomous Gu shall make the report via a Mayor/Do Governor. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 72 (Measures, etc. Taken for Publication)   print
(1) The Minister of Public Administration and Security may analyze and evaluate the results of the publication of the current operational status of the finances submitted pursuant to Article 71 and then provide appropriate guidance or reflect the results thereof in the analysis of local government finances. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) Where the contents of the current operational status of the finances are found to be inadequate and problematic as a result of the analysis and the evaluation under paragraph (1), the Minister of Public Administration and Security may require the relevant local government to make a public re-notification of the operational status. Where the results of the subsequent publication are found to be inadequate or the relevant local government fails to make the republication, the Minister of Public Administration and Security himself/herself may make such re-notification. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
CHAPTER VI REVENUES
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 Article 73 (Decision to Inspect Annual Revenues)   print
(1) When any collection officer intends to make a decision regarding collection of local taxes and the annual revenues pursuant to Article 62 (2) of the Act, he/she shall inspect whether the relevant annual revenues are in conformity with Acts and subordinate statutes, the year to which such annual revenues belong, and the items of such annual revenues.
(2) With respect to any cash that is collected by any treasurer in charge of receiving and disbursing revenues without resorting to the payment notice, any collection officer shall decide to collect such cash according to the receipt report.
(3) When any collection officer decides to collect annual revenues pursuant to paragraph (2), he/she shall serve a collection decision notice on the relevant treasurer in charge of receiving and disbursing revenues.
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 Article 74 (Payment Notice)   print
The payment notice provided for in the provisions of Article 62 (2) of the Act shall be served on any person liable for the payment in a document in which the items of annual revenues, the amount to be paid, the payment period and the place for payment are noted: Provided, That where the payment is made immediately to the treasurer in charge of receiving and disbursing revenues, a verbal notice may be served in lieu of the payment notice.
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 Article 75 (Receipts by Treasurers in Charge of Receiving and Disbursing Revenues)   print
When any treasurer in charge of receiving and disbursing revenues collects local tax and annual revenues pursuant to the provisions of Article 63 (1) of the Act, he/she shall issue a receipt therefor to the payer and report his/her receipt of the local tax and the annual revenues to the collection officer.
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 Article 76 (Payment of Funds Received)   print
The payment of the funds received as provided for in the provisions of Article 63 (2) of the Act shall, if the payment thereof is received in a place where the depository is located, be made by the next day, and in other cases, the payment thereof shall be made within 5 days.
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 Article 77 (Receipt in Depository)   print
Where the annual revenues or the payments of the annual revenues, are received in the depository, a receipt therefor shall be issued to the payer and a report on the receipt therefor shall be made to collection officers.
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 Article 78 (Revenues Paid in Securities)   print
(1) Where the local tax and the amount of annual revenues are paid, they may be paid in securities, in lieu of cash.
(2) In the case of paragraph (1), the kinds of securities that can be paid in lieu of cash, procedures for making payments in securities and other necessary matters shall be determined by the rules of the relevant local government.
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 Article 79 (Revenues Received by Means of Revenue Certificate Stamps)   print
(1) The local tax and the non-tax revenues that are prescribed by Acts and subordinate statutes or by Municipal Ordinance or the rules of the relevant local government may be received in revenue certificate stamps.
(2) In the case of paragraph (1), the revenue certificate stamps shall be immediately postmarked and no determination to collect the annual revenues nor any procedures for receiving the annual revenues shall be made or taken.
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 Article 80 (Case for Concurrent Performance of Official Work Involving Collections and Receipts)   print
In any local government office for which not more than three public officials work, with the exception of laborers, such public officials may concurrently perform the work of collecting annual revenues and receiving and disbursing cash pursuant to the provisions of the proviso to Article 64 of the Act.
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 Article 81 (Refund of Expenditures to Item of Annual Expenditures)   print
Where the amount that is disbursed as annual expenditures pursuant to the provisions of the proviso to Article 65 of the Act is refunded, when the amount is disbursed in error due to serious negligence, the amount in question shall not be credited to the relevant item, but to the compensation item.
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 Article 82 (Procedures for Recovering Disbursed Funds)   print
When the public official in charge of expenditures intends to recover any annual expenditure that is disbursed pursuant to the provisions of the proviso to Article 65 of the Act, he/she shall cause the person liable to refund it to refund the amount thereof.
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 Article 83 (Notice of Refund of Disbursed Funds by Depository)   print
When the depository receives the annual expenditures disbursed pursuant to the provisions of Article 82, it shall record the receipt thereof in the book and then notify the public official in charge of expenditures of the details of the receipt.
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 Article 84 (Preparation and Submission of Collection Report)   print
Each collection officer shall prepare a report on the collection of annual revenues each month and submit the report, accompanied by reference documents to the head of the relevant local government on or before the 15th day of the following month.
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 Article 84-2 (Interest on Refunds of Overpayments or Erroneous Payments)   print
Any interest referred to in the main sentence of Article 66 (2) of the Act shall be calculated by applying a rate of interest referred to in Article 30-2 of the Enforcement Decree of the Framework Act on National Taxes for the period from the next day of any date classified in the following to the day of refund:
1. The date on which an overpayment or erroneous payment is made, where a refund is made after confirmation of a wrong payment, such as a mistaken payment and double payment, or through any other objection application, etc: Provided, That where such payment is made in two or more installments, the interest shall be calculated from the last payment date for such installments, but where the refund of the overpayment or erroneous payment exceeds the last paid installment, the interest shall be calculated based on each payment date backdated in the sequence of payment dates for installments until the amount of such refund reaches a sum of money by installments;
2. The date on which any relevant Act and subordinate statute enters into force, where a refund is made as the relevant Act and subordinate statute is amended after a payment is legitimately made;
3. The date on which a reduction in a payment is determined, where a refund is made as the payment is reduced after the payment is legitimately made;
4. The date on which any relevant administrative disposition is determined, where a refund is made due to revisions to a business plan, etc, cancellation of permission, etc. obtained by a payer due to responsible reasons, and any other similar reasons thereto after the payment is legitimately made.
[This Article Newly Inserted by Presidential Decree No. 23121, Sep. 6, 2011]
CHAPTER VII EXPENDITURES
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 Article 85 (Redistribution of Budget)   print
(1) Where any public official who is commissioned to perform the clerical work involving the incurring of expenditures pursuant to the provisions of Article 67 of the 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 accounting official who is recommissioned within the scope of the allocated budget of annual expenditures and redistribute the budget of annual expenditures according to such plan.
(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 the provisions of paragraph (1).
(3) When any accounting official who is recommissioned to incur expenditures pursuant to the provisions of paragraph (1) incurs expenditures, such expenditures shall not exceed the scope of the redistributed budget of annual expenditures.
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 Article 86 (Distribution of Funds)   print
When the budget is enacted, the head of each local government shall develop a plan for distributing funds monthly or quarterly according to the plan for allotting the budget provided for in the provisions of Article 56 and then notify agencies that have public officials in charge of expenditures of the expenditure limits: Provided, That where additional supply of funds are deemed urgently necessary for budget spending or it is deemed inevitable for operating funds, such funds may be supplied as occasion requires.
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 Article 87 (Confirmation before Issuance of Payment Order)   print
Before public officials in charge of expenditures issue a payment order as provided for in the provisions of Article 70 of the Act, they shall confirm whether the disbursement of expenses exceeds the budget allocated and the expenditure limit and the disbursement of expenses is in conformity with the item of annual expenditures of the relevant year.
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 Article 88 (Payment Made by Payment Order)   print
(1) Any payment that is made pursuant to the payment order provided for in Article 70 of the Act shall be made by the close-off deadline for receipts and disbursements of the relevant fiscal year.
(2) When anyone who is issued with a payment order whose payment deadline referred to in paragraph (1) has lapsed files a claim for repayment, public officials in charge of expenditures shall decide whether to make the claimed repayment and then take measures necessary to make such repayment.
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 Article 89 (Matters to be Noted in Payment Order)   print
(1) All payment orders shall state the name (in the case of any corporation, its trading name) of the creditor or his/her agent or the name and position of person who is to take the delivery of cash, the amount, the disbursement item, the year and the number.
(2) When local governments intend to perform the payment replacements among the accounts thereof, a payment order, as provided for in paragraph (1) shall be issued with the words "replacement required" noted thereon.
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 Article 89-2 (Handling of Expenditures by Designated Information Processor)   print
(1) A public official in charge of expenditures or a treasurer shall use the information processor designated by the Minister of Public Administration and Security when expenditures made under Articles 67 through 76 of the Act. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
[This Article Newly Inserted by Presidential Decree No. 20504, Dec. 31, 2007]
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 Article 90 (Types of Payment Order)   print
(1) Payment orders shall be categorized as ordinary payment orders, remittance payment orders or aggregate payment orders.
(2) Ordinary payment orders shall be issued when the depository makes payments directly to creditors.
(3) Remittance payment orders shall be issued when payments are remitted to the addresses of creditors.
(4) Aggregate payment orders shall be issued when payments under the same item of expenditure are remitted to several creditors.
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 Article 90-2 (Methods of Expenditure)   print
(1) When a public official in charge of expenditures, under Article 70 of the Act, issues a payment order or makes payments, he/she shall, under Article 77 of the Act, have a relevant local government's depository transfer and make payments to bank accounts of creditors or the trustees in charge of payments by local governments under Article 103 (hereinafter referred to as the "creditors, etc."), with the exception of where cash payments are inevitable, such as travel expenses, unless determined by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) When a public official in charge of expenditures makes any depository transfer payment to the bank accounts of creditors, etc. under paragraph (1), he/she shall send payment orders to the depository. In such cases, the head of a local government, in agreement with the depository, may have payment orders transmitted electronically.
[This Article Newly Inserted by Presidential Decree No. 20504, Dec. 31, 2007]
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 Article 91 (Scope of Ordinary Expenses, etc.)   print
(1) The expenses for which funds can be supplied to treasurers in charge of ordinary expenses pursuant to Article 72 (1) of the Act shall be as follows: <Amended by Presidential Decree No. 21260, Jan. 13, 2009>
1. Travel expenses;
2. General operating expenses;
3. Expenses for local government offices that do not have public officials in charge of expenditure;
4. Expenses for offices without fixed locations;
5. Expenses for local government offices to perform construction works, manufacturing and afforestation;
6. Expenses for paying small sums of money directly to several different persons;
7. Expenses that are paid abroad;
8. Expenses necessary for ships to sail;
9. Payments of the principal and interest of local government bonds issued as securities or borrowings;
10. Expenses paid in any place that is not under the jurisdiction of the relevant local government: Provided, That in the case of a Do, transport expenses that are required outside the administrative area in which the Do office is located shall be included;
11. Those salaries, bonuses, remuneration, allowances, fixed allowances and fixed welfare expenses paid to public officials;
12. Various allowances, rewards and indirect official business expenses;
13. Expenses incurred to purchase refreshments for local government offices or expenses incurred to purchase materials for construction works, tests and inspections;
14. Where public officials who work for State organs or other local governments are appointed as accounting officers pursuant to Article 93 of the Act, the expenses that are paid to such public officials;
15. Moving expenses for civilians, compensations, service fees and expenses incurred to purchase articles. <<Period of Validity: Oct. 31, 2009>>
(2) The expenses referred to in each subparagraph of paragraph (1) shall not be paid in excess of the amount that is stipulated in each of the following subparagraphs: Provided, That the expenses provided for in paragraph (1) 2, 3, 7, 9, 11, 12, 14 and 15 shall not be subject to such limits on the amount payable: <Amended by Presidential Decree No. 21260, Jan. 13, 2009>
1. In cases of paragraph (1) 1, 4, 6, 8, 10 and 13, ten million won each;
2. In cases of paragraph (1) 5, 20 million won: Provided, That the limits on the amount payable shall not be applicable by October 31, 2009.
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 Article 92 (Limits on Payment of Funds)   print
The standards for which the funds provided for in Article 91 may be paid shall be as follows:
1. With respect to the ordinary expenses for local government offices, an estimated monthly amount shall be paid: Provided, That the expenses of any office without a fixed location and the expenses that are paid abroad may be paid up to three-monthly as required by the clerical work;
2. With respect to occasional expenses, the required amount shall be estimated and paid in installments as long as this does not impede the progress of clerical work.
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 Article 93 (Payment of Funds Prior to Commencement of Fiscal Year)   print
The payment of any funds to the treasurer in charge of ordinary expenses prior to the commencement of the fiscal year pursuant to Article 72 (2) of the Act shall be limited to the expenses provided for in each subparagraph of Article 57.
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 Article 94 (Generating Payment of Ordinary Expenses)   print
The treasurer in charge of ordinary expenses may generate payments (hereinafter referred to as "generating payments") from any fund that is paid by the public official in charge of expenditures within the scope of the amount by item: Provided, That if it is deemed expecially necessary for the special account for educational expenses, the head of each local government may cause the treasurer in charge of ordinary expenses to generate payments of the commissioned accounting official who is designated by the head of the relevant local government before the ordinary expenses are paid.
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 Article 95 (Interim Treasurer in Charge of Ordinary Expenses)   print
(1) Where it is deemed necessary for receiving and disbursing ordinary expenses, an interim treasurer in charge of ordinary expenses may be appointed.
(2) The provisions of Articles 94 and 100 shall not apply to an interim treasurer in charge of ordinary expenses.
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 Article 96 (Advance Payment)   print
(1) The expenses that may be paid through the advance payment pursuant to the provisions of Article 73 of the Act shall be as follows:
1. Land or housing rentals and charterage;
2. Freight and rewards;
3. Expenses paid to public offices (including government-invested institutions; hereinafter the same shall apply) and expenses paid to institutions that perform official affairs on behalf of the State or local governments;
4. Charges, grants and subsidies;
5. Land purchased or expropriated by local governments or the prices, compensation or transfer expenses for chattels on that land;
6. Expenses paid to persons commissioned to conduct tests, research or surveys;
7. Charges paid for publication in the official gazette and periodicals;
8. Costs of machinery, books, samples or experimental materials that are purchased abroad;
9. Expenses paid to persons engaged in research or surveys abroad;
10. Salaries paid to persons who work in remote areas, or to ship crew;
11. Expenses incurred when any construction works or any manufacturing in the Republic of Korea are commissioned to any foreign institution or any foreign person for a foreign aid project;
12. Salaries paid to persons who are transferred to other posts or are traveling on official business or on leave on the date of payment;
13. Where construction works or manufacturing, the contract value of which exceeds 30 million won and the value of services exceeds ten million won, and where a contract is concluded with the residents of an area or their representative pursuant to subparagraph 7 (e) of Article 25 of the Enforcement Decree of the Act on Contracts to which a Local Government is a Party, an amount that does not exceed 70/100 of the contract amount;
14. Expenses reimbursed to foreign persons who are invited to the Republic of Korea by local governments.
(2) In cases of paragraph (1) 13, the advance payment shall be made within 14 days from the date on which a claim therefor is filed by the other party to the contract after such contract is concluded as prescribed by the Minister of Public Administration and Security: Provided, That the same shall not apply to cases where the other party to the contract is notified in writing that such advance payment cannot be made due to inevitable circumstances, such as financial difficulties. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 97 (Scope of Estimated Payment)   print
The expenses that may be paid as estimated payments pursuant to Article 73 of the Act shall be as follows: <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
1. Travel expenses, indirect official business expenses, special activity expenses and expenses for local government offices;
2. Litigation costs;
3. Expenses paid to local government offices;
4. Charges, grants and subsidies;
5. Other expenses prescribed by the Minister of Public Administration and Security.
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 Article 98 (Scope of Local Government Offices that Pay Contract Expenses)   print
Local government offices entitled to payment of the contract expenses pursuant to Article 74 of the Act shall be as follows: <Amended by Presidential Decree No. 19586, Jun. 30, 2006>
1. Branch offices of a Eup/Myeon/Dong;
2. 119 emergency call centers and 119 local emergency call centers;
3. Kindergartens, elementary schools, middle schools, high schools, and other schools corresponding thereto;
4. Stations and service offices of subways;
5. Crematorium;
6. Management offices of water resources;
7. Rubbish furnace stations and rubbish burial stations;
8. Sewage treatment facilities and excreta treatment facilities;
9. Overseas offices of local governments;
10. 119 emergency squads;
11. Local government offices whose fixed number of regular personnel does not exceed three persons.
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 Article 99 (Scope of Payment of Contract Expenses)   print
The expenses that may be paid as the contract expenses pursuant to the provisions of Article 74 of the Act shall be as follows: <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
1. General operating expenses;
2. Travel expenses;
3. Other expenses determined by the Minister of Public Administration and Security.
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 Article 100 (Concurrent Performance of Work)   print
In any local government office whose number of regular personnel is one except laborers provided for in the provisions of the proviso to Article 75 of the Act, such person may concurrently work as the commissioned accounting official and the treasurer in charge of ordinary expenses.
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 Article 101 (Supplementary Expenses)   print
Expenses incurred for the purpose of the supplementary expenses provided for in the proviso to Article 76 of the Act shall be as follows: <Amended by Presidential Decree No. 22564, Dec. 29, 2010>
1. Remuneration of public officials;
2. Pension premiums provided for in the Public Officials Pension Act;
3. Death benefits of public officials;
4. Payments for treating injuries of public officials suffered in the course of official business;
5. Compensation and remuneration;
6. All refunds, reserves for losses, and repayments;
7. Interest;
8. Expenses for litigation and registrations;
9. Expenses incurred to print Bills that are submitted to local councils pursuant to Acts and subordinate statutes, Municipal Ordinances and rules;
10. Subsidies incurred to commission the collection of local taxes;
11. Expenses incurred to take dispositions to collect amounts in arrears and penalties;
12. Expenses incurred to prevent communicable diseases;
13. Expenses incurred to make certificates;
14. Expenses incurred to return and store goods;
15. Various taxes and public levies;
16. Discrepancies, etc. that accrue from increases in public and official levies;
17. Insurance premiums.
CHAPTER VIII CASH AND SECURITIES
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 Article 102 (Agreements concerning Work of Depositories)   print
(1) Where the head of any local government designates any depository pursuant to Article 77 (1) of the Act, he/she shall conclude an agreement with the relevant financial institution for the work of the depository, and the relevant financial institution shall perform with diligence and in good faith all duties and details agreed as the depository, as prescribed by Acts and subordinate statutes, municipal ordinances and rules.
(2) “Security standards determined by Presidential Decree are met” provided for in the proviso to Article 77 (1) of the Act means that all the following requirements are met based on an audit report prepared by any auditor prescribed in Article 3 of the Act on External Audit of Stock Companies: <Newly Inserted by Presidential Decree No. 23674, Mar. 26, 2012>
The total asset is not less than 250 billion won;
The total capital is not less than 25 billion won;
The total capital to total asset ratio is not less than 10 percent;
The net profits before corporate tax has been realized for three consecutive years.
(3) The standards and procedures for designating depositories pursuant to the provisions of Article 77 (3) of the Act shall be determined by the Minister of Public Administration and Security, considering the abilities of financial institutions to handle the work of depositories, a convenience for residents to access depositories and the financial structures of financial institutions, etc. <Amended by Presidential Decree No. 20741, Feb. 29, 2008; Presidential Decree No. 23674, Mar. 26, 2012>
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 Article 103 (Performance of Part of Depository Work by Proxy)   print
(1) Any financial institution that performs depository work may commission part of the depository work under its responsibility to any bank provided for in the Banking Act, any postal agency, any community credit cooperative provided for in the Community Credit Cooperatives Act, any credit union provided for in the Credit Unions Act, any mutual savings bank provided for in the Mutual Savings Banks Act and any corporation that is a member of the relevant financial institution involved in the credit card industry or the credit industry provided for in the Specialized Credit Financial Business Act after obtaining approval therefor from the head of the local government. <Amended by Presidential Decree No. 22493, Nov. 15, 2010>
(2) Where it is deemed necessary, the head of a local government may cause the financial institution in charge of the depository work to commission part of its depository work to any bank provided for in the Banking Act, any postal agency, any community credit cooperative provided for in the Community Credit Cooperatives Act, any credit union provided for in the Credit Unions Act, any mutual savings bank provided for in the Mutual Savings Banks Act and any corporation that is a member of the relevant financial institution involved in the credit card industry or the credit industry provided for in the Specialized Credit Financial Business Act, each as designated by the head of the local government. <Amended by Presidential Decree No. 22493, Nov. 15, 2010>
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 Article 103-2 (Operation of Integrated Revenue Collection System)   print
A local government may build and operate the Integrated Revenue Collection System with any other local government by entering into an agreement with a person falling under any of the following subparagraphs in order to efficiently carry out the collection of local taxes and other revenue, and to enhance the residents' convenience of payment:
1. The depository of the relevant local government (including a person who performs part of depository work pursuant to Article 103 (1) and (2));
2. The depository of any other local government (including a person who performs part of depository work pursuant to Article 103 (1) and (2));
3. The operator of a settlement intermediary system under subparagraph 6 of Article 2 of the Electronic Financial Transactions Act;
4. A corporation, agency, or organization related to the collection of local taxes and other revenue, other than those provided for in subparagraphs 1 through 3.
[This Article Newly Inserted by Presidential Decree No. 22532, Dec. 20, 2010]
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 Article 104 (Keeping of Cash, etc., other than Annual Revenues and Expenditures in Custody of Depository)   print
(1) The treasurer in charge of receiving and disbursing cash, other than annual revenues and expenditures, shall classify the cash, other than annual revenues and expenditure, of any local government by category and retain such cash in the depository. The year classification shall be made on the basis of the year to which the date on which the revenues are received and the expenditure is disbursed belongs.
(2) Clerical work involving the receipt and disbursement of securities owned or kept by any local government shall be performed by the treasurer in charge of receiving and disbursing cash, other than annual revenues and expenditure, except where any public official in charge of securities is designated pursuant to a Municipal Ordinance or rules, and such securities shall be kept in the depository pursuant to paragraph (1): Provided, That the same shall not apply to the securities provided for in the provisions of Article 78.
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 Article 105 (Special Cases concerning Handling of Securities)   print
Securities submitted in lieu of various security deposits in connection with contract affairs may not be kept in the depository, notwithstanding the provisions of Article 104 (2).
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 Article 106 (Inspection of Depositories)   print
The heads of local governments shall inspect the receipts and disbursements of depositories and their books not less than once annually pursuant to the provisions of Article 79 of the Act.
CHAPTER IX CLAIMS AND OBLIGATIONS
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 Article 107 (Definition of Clerical Work Involving Management of Claims)   print
The term "clerical work involving management of claims" in Article 87 (1) of the Act means clerical work that does not fall 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:
1. Clerical work that is performed by any collection officer pursuant to the provisions of Article 62 of the Act;
2. Clerical work that is performed by anyone who is in charge of taking dispositions on defaults pursuant to the provisions of Acts and subordinate statutes;
3. Clerical work involving accepting the fulfillment of obligations;
4. Clerical work involving the custody of cash or goods.
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 Article 108 (Scope of Clerical Work Involving Management of Obligations)   print
The scope of obligations of the local government, which must be managed pursuant to the provisions of Article 87 (3) of the Act, shall be as follows:
1. Local government bonds issued as securities;
2. Borrowings;
3. Incurring of obligations;
4. Incurring of guaranteed obligations.
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 Article 109 (Exclusion from Applicability)   print
The provisions of Articles 110 through 133 shall not apply to the claims falling under any of the following subparagraphs:
1. Fines for negligence 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.
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 Article 110 (Report on Accrual or Reversion of Claims)   print
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 Acts and subordinate statutes, 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 Acts and subordinate statutes, 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 Acts and subordinate statutes, 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.
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 Article 111 (Payment Notices)   print
(1) The head of each local government shall serve a payment notice, claiming the fulfillment of obligations on 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 Acts and subordinate statutes 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.
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 Article 112 (Serving of Demand Notice)   print
(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.
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 Article 113 (Claim Filed for Compulsory Fulfillment of Claims)   print
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.
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 Article 114 (Shortening of Deadline for Meeting Claims)   print
When grounds arise that make it possible to shorten the deadline for meeting claims, the head of the relevant local government shall promptly 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).
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 Article 115 (Report on Claims)   print
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 Acts and subordinate statutes, 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.
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 Article 116 (Other Measures for Preservation)   print
(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 Acts and subordinate statutes, 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 Acts and subordinate statutes, 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 Acts and subordinate statutes, Municipal Ordinances and rules as a creditor, the head of the relevant local government shall promptly file a claim 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.
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 Article 117 (Preservation of Security)   print
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.
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 Article 118 (Preservation of Security and Material Evidence, etc.)   print
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.
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 Article 119 (Discontinuation of Collection)   print
(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.
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 Article 120 (Set-off, etc.)   print
(1) When the head of any local government becomes aware that any claims can be offset by the relevant claims pursuant to the provisions of Acts and subordinate statutes, Municipal Ordinances or rules, or the claims can be appropriated for repaying the obligations of his/her local government, he/she shall immediately order the public officials in charge of expenditures who are responsible for such obligations to perform the setoff or appropriate the claims for repaying the obligations of the local government.
(2) When the public officials in charge of expenditures become aware that their local governments hold claims that can be offset by the relevant obligations or can be appropriated for repaying such obligations pur suant to the provisions of Acts and subordinate statutes, Municipal Ordinances or rules when the order referred to in the provisions of paragraph (1) is issued on the obligations concerning their expenditures, they shall promptly perform the set-off or the appropriation and then report the fact to the heads of their local governments.
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 Article 121 (Report on Extinguishment)   print
When collection officers, persons in charge of repaying the obligations of their local governments pursuant to the provisions of Acts and subordinate statutes, 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 work, they shall promptly report the fact to the heads of relevant local governments.
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 Article 122 (Reorganization of Claims Deemed Extinguished)   print
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:
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.
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 Article 123 (Setting Deadline for Meeting Claims)   print
(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 Acts and subordinate statutes.
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 Article 124 (Special Agreement, etc. on Extending Period during Which Claims Are Met)   print
(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 Acts. In such cases, the period during which the amount of the relevant claims is paid in installments may be set:
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 ex tending 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 does not exceed 100,000 won.
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 Article 125 (Deadline for Extending Period during Which Claims Are Met)   print
(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).
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 Article 126 (Measures for Special Agreement on Extending Period during Which Claims Are Met)   print
(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 by Presidential Decree No. 22493, Nov. 15, 2010>
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 Article 127 (Acquisition of Title)   print
(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.
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 Article 128 (Conditions Set in Special Agreement on Extending Period during Which Claims Are Met)   print
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.
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 Article 129 (Compromise)   print
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.
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 Article 130 (Exemption)   print
(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 ten 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 does not exceed 100,000 won.
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 Article 131 (Special Case concerning Late Payment Penalties)   print
(1) When the amount of the claim (excluding any claim that bears interest or is governed by the provisions of other Acts and subordinate statutes 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 inadvertently or without gross negligence.
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 Article 132 (Terms of Contracts concerning Claims)   print
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 Acts and subordinate statutes, 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 Acts and subordinate statutes, Municipal Ordinances or rules.
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 Article 133 (Agreement on Contract of Claims)   print
(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), 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
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 Article 134 (Integrated Expenditures of Finance)   print
(1) Integrated expenditure officers provided for in Article 90 (2) of the Act shall be appointed by the heads of local governments and the integrated expenditure officers shall each perform the clerical work falling under each of the following subparagraphs:
1. The preparation of the financial report provided for in the provisions of Article 53 (1) of the Act;
2. Matters concerning the transfer of integrated accounts of funds that are disbursed at the request of public officials in charge of expenditures or treasurers of local government offices and the integrated management and operation of funds.
(2) The heads of local governments may require an integrated expenditure officer to work concurrently with any accounting officer provided for in Article 91 of the Act.
(3) Necessary matters concerning the integrated expenditure of finances shall be prescribed by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 135 (Performance of Local Government Accounting by State Public Officials)   print
The head of each local government may require any State public official to perform clerical work involving annual revenues and expenditure, cash, other than annual revenues and expenditure, or goods of his/her local government.
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 Article 136 (Disbursement of Reserve for Losses)   print
(1) When annual revenues and expenditure or cash, other than the annual revenues and expenditure misplaced by a treasurer in charge of ordinary expenses or a treasurer in charge of receiving and disbursing cash, other than annual revenues and expenditure are not expected to be retrieved during the relevant year, the public official in charge of expenditures shall request the head of the relevant local government to cover such losses.
(2) When it is deemed necessary to cover such losses after receiving the request referred to in paragraph (1), the head of the relevant local government shall require the public official in charge of expenditures to disburse the reserve for losses.
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 Article 137 (Report on Misplacement by Treasurer)   print
When the treasurer, his/her agent or the commissioned person misplaces any cash and misplaces or damages any goods in custody, he/she shall report without delay the fact to the head of the relevant local government via the public official in charge of expenditures or the public official in charge of managing goods.
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 Article 138 (Financial Guarantees Furnished by Accounting Officers)   print
The limit on financial guarantees of any accounting official or the limit on the amount of mutual aid in which such an accounting official may participate under the provisions of Article 95 (2) of the Act shall be determined by the head of the local government concerned, within the scope of 10 million won or more, taking into account the position of the public official in charge of accounting, the scope of responsibility, etc. <Amended by Presidential Decree No. 19995, Apr. 5, 2007>
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 Article 139 (Inspection of Books, etc. of Treasurers)   print
When the treasurers are transferred or at the end of every fiscal year, the heads of local governments shall order inspectors to check the books, containers or goods of which the relevant treasurers are responsible for management.
CHAPTER XI SUPPLEMENTARY PROVISIONS
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 Article 140 (Keeping of Collection Books, etc.)   print
(1) Collection officers, accounting officials and public officials in charge of expenditure shall each keep collection books, books on expenditure incurred and books on expenditures, and record relevant matters in such books pursuant to the provisions of Article 96 of the Act.
(2) Treasurers shall each keep books of cash receipt and disbursement and books of receipt and disbursement of goods, and record the receipt and disbursement of cash and goods.
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 Article 141 (Books To Be Kept in Depositories)   print
(1) Every depository shall keep the books falling under each of the following subpragraphs pursuant to the provisions of Article 96 of the Act and record the receipt and disbursement of cash and the supply and demand of securities for local governments:
1. A book on the annual revenues and expenditures and the receipt and disbursement of cash, other than annual revenues and expenditures;
2. A book on the receipt and disbursement of funds paid;
3. A book on the issuance and repayment of local government bonds;
4. A book on the receipt and disbursement of funds delivered pursuant to the provisions of Article 72 (3) of the Act;
5. A book on the supply and demand of securities.
(2) Every depository shall keep a book on the workings of depository and evidential documents for five years following the lapse of the relevant fiscal year.
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 Article 142 (Submission of Accounting Statements)   print
(1) Public officials in charge of expenditures shall compile an accounting statement on the disbursement of annual expenditure under their jurisdiction to submit to the head of the relevant local government.
(2) Treasurers in charge of ordinary expenses and treasurers in charge of receiving and disbursing cash, other than annual revenues and expenditures, shall compile a statement on the receipt and disbursement of cash under their jurisdiction and submit such statement on receipt and disbursement to the head of the relevant local government via public officials in charge of expenditures.
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 Article 143 (Submission of Daily Account Sheets, etc. by Depositories)   print
Depositories shall submit daily account sheets and monthly account sheets on receipts and disbursements, and other necessary reports to the heads of local governments.
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 Article 144 (Matters concerning Financial Accounting)   print
(1) When it is deemed necessary to perform the uniform operation of budgets, the settlement of accounts, revenues and expenditures and the financial accounting of local governments, other than the matters prescribed by this Decree, the Minister of Public Administration and Security may set the standards therefor, taking into account Acts and subordinate statutes, etc. governing the budget and accounting of the State. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
(2) Notwithstanding paragraph (1), the matters concerning the guidelines for the execution of business promotion expense of each local government shall be prescribed by Ordinance of the Ministry of Public Administration and Security. <Newly Inserted by Presidential Decree No. 20123, Jun. 28, 2007; Presidential Decree No. 20741, Feb. 29, 2008>
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 Article 145 (Rules of Local Government)   print
Matters relevant to financial accounting, other than the standards determined by this Decree and the Minister of Government Administration and Home Affairs shall be prescribed by the rules of the local government within the scope of the standards determined by the Minister of Public Administration and Security. <Amended by Presidential Decree No. 20741, Feb. 29, 2008>
[This Article Newly Inserted by Presidential Decree No. 19995, Apr. 5, 2007]
ADDENDA
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 Acts and Subordinate Statutes)
Where the previous Enforcement Decree of the Local Finance Act or the provisions thereof is or are cited by other Acts and subordinate statutes 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.
ADDENDUM <Presidential Decree No. 23674, Mar. 26, 2012>
This Decree shall enter into force on the date of its promulgation.