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Enforcement Decree Of The Financial Holding Companies Act


Published: 2013-07-08

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 Article 1 (Purpose)   print
The purpose of this Decree is to provide for matters delegated by the Financial Holding Companies Act and matters needed for the enforcement thereof. <Amended by Presidential Decree No. 18834, May 26, 2005>
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 Article 2 (Scope of Financial Business, etc.)   print
(1) "Financial business" in Article 2 (1) 1 of the Financial Holding Companies Act (hereinafter referred to as the "Act") means financial and insurance business in accordance with the Korean Standard Industrial Classifications announced by the Commissioner of the Statistics Korea under Article 22 (1) of the Statistics Act. <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20331, Oct. 23, 2007>
(2) "Companies closely related to the operation of financial business" in Article 2 (1) 1 of the Act means companies aiming at the operation of any of the following business: <Amended by Presidential Decree No. 22509, Dec. 2, 2010>
1. Provision of services, such as electronic and data processing, to companies conducting financial businesses (hereinafter referred to as "financial institutions");
2. Management of real estate and other assets held by financial institutions;
3. Investigation and research related to financial business;
4. Operations including asset management conducted by employees of a private equity fund established under the Financial Investment Services and Capital Markets Act (hereinafter referred to as "private equity fund");
5. Other business directly related to the business affairs unique to financial institutions.
(3) "Standards prescribed by Presidential Decree" in the part other than the items of Article 2 (1) 1 of the Act means that a company becomes the largest contributor to an affiliated company (in cases where the affiliated company is a private equity fund, the largest contributor means a managing partner of the private equity fund; companies which fall under any of the following subparagraphs shall be excluded from such affiliated companies; hereinafter referred to as an "affiliated company") under subparagraph 3 of Article 2 of the Monopoly Regulation and Fair Trade Act, on its own or by a joint investment from the persons described in subparagraphs 1 and 2 of Article 11 of the Enforcement Decree of the said Act (hereafter referred to as a "specially related person" in this paragraph): Provided, That cases where the amount of stocks held by the company is smaller than the amount of stocks held by each specially related person shall be excluded herefrom: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22509, Dec. 2, 2010; Presidential Decree No. 22577, Dec. 30, 2010>
1. Where a small or medium start-up investment company established under the Support for Small and Medium Enterprise Establishment Act has acquired the stocks of another domestic company with the aim to invest in its founder, such other domestic company;
2. Where a venture capital business operator established under the Specialized Credit Finance Business Act has acquired the stocks of another domestic company with the aim to support venture business entities, such other domestic company;
3. Where a private equity fund has acquired the stocks of another company to increase the value of the invested company in order to distribute such profits to its personnel, such other company;
4. Where subsidiary or second- or third-tier subsidiaries (including other companies owned by a financial holding company pursuant to Articles 19 (2) and 32 of the Act; hereinafter referred to as "subsidiary, etc.") of a financial holding company have acquired the stocks of a company (limited to companies falling under Article 51-2 (1) 9 of the Corporate Tax Act) which aims to carry out a public-private partnership project designated by the competent authority under Article 8-2 of the Act on Public-Private Partnerships in Infrastructure, such company which aims to carry out a public-private partnership project;
5. Where an investment trader under the Financial Investment Services and Capital Markets Act has underwritten or acquired the stocks of another company under the said Act and holds them for up to three months from the date of acquisition, such other company.
(4) The criterion for the primary business referred to in Article 2 (1) 1 of the Act stipulates that the aggregate of the value of stocks (including shares; hereinafter the same shall apply) of a subsidiary (excluding foreign corporations) held by a company shall be 50/100 or more of the total amount of the company's assets. In such cases, the stock value of the subsidiary and the total amount of assets of the company shall be based on the amounts recorded in the balance sheet as at the date which falls under either of the following (hereinafter referred to as the "base date"): <Amended by Presidential Decree No. 20367, Nov. 12, 2007>
1. In cases of a company which is newly established, merged or incorporated by division, merger through division or physical division in the relevant business year, the date of registration of establishment, date of registration of merger or date of registration of division, respectively;
2. In cases of companies other than those in subparagraph 1, the date of settlement of accounts in the preceding business year: Provided, That where a company intends to obtain authorization under Article 3 of the Act since the total amount of stock values of its subsidiaries exceeds 50/100 of the total amount of the company's assets before the date of settlement of accounts in the relevant business year, the date on which such cause occurs.
(5) "Not less than the standards prescribed by Presidential Decree" in Article 2 (1) 1 (b) of the Act means that the total amount of assets recorded in the balance sheet as of the base date shall be not less than 100 billion won. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
(6) "Financial institution prescribed by Presidential Decree" in Article 2 (1) 6-4 (c) of the Act means either of the following companies: <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
1. A financial securities company under Article 9 (17) 3 of the Financial Investment Services and Capital Markets Act (hereinafter referred to as "financial securities company");
2. A merchant bank under Article 336 (1) of the Financial Investment Services and Capital Markets Act (hereinafter referred to as "merchant bank"): Provided, That cases where a financial investment business entity under the Financial Investment Services and Capital Markets Act (hereinafter referred to as "financial investment business entity") merges with a merchant bank under Article 4 (1) of the Act on the Structural Improvement of the Financial Industry shall be excluded herefrom.
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 Article 3 (Scope of Specially Related Persons)   print
(1) "Person in a special relationship prescribed by Presidential Decree with the principal" in Article 2 (1) 7 of the Act refers to any person having relationship defined in each subparagraph of Article 1-4 (1) of the Enforcement Decree of the Banking Act with the subject person (hereinafter referred to as a "specially related person").
(2) Notwithstanding paragraph (1), a person falling under any of the following subparagraphs shall be excluded from the scope of the same person under Article 2 (1) 7 of the Act: <Amended by Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 22493, Nov. 15, 2010; Presidential Decree No. 22577, Dec. 30, 2010>
1. A company conducting public-private partnership projects designated by the competent authority under Article 8-2 of the Act on Public-Private Partnerships in Infrastructure: Provided, That in cases the aforementioned company is not the same person in which a fund under Article 5 of the National Finance Act or a corporation managing and operating such fund (including a corporation entrusted with the management and operation of funds under Acts; hereinafter referred to as "fund, etc.") is included, it shall be limited to companies falling under Article 51-2 (1) 9 of the Corporate Tax Act;
2. Where a bank (referring to a bank with authorization under the Banking Act; hereinafter the same shall apply) or a financial institution which is a subsidiary, etc. of a bank holding company acquires stocks of another company by conversion of investment for the purpose of corporate restructuring under the Corporate Restructuring Promotion Act or the Debtor Rehabilitation and Bankruptcy Act (including cases equivalent thereto), such other company;
3. Where a private equity fund falling under either of the following items acquires stocks of another company for the purpose of increasing the value of the company in which the private equity fund has invested and then distributing profits therefrom to its partners, such other company:
(a) A private equity fund which is a subsidiary, etc. of a bank under the proviso to the part other than each subparagraph of Article 37 (2) of the Banking Act;
(b) A private equity fund which is a subsidiary, etc. of a bank holding company.
[This Article Wholly Amended by Presidential Decree No. 21155, Dec. 3, 2008]
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 Article 3-2 (Definition of Non-Financial Devotee)   print
(1) "Finance business prescribed by Presidential Decree" in Article 2 (1) 8 (a) of the Act means the types of business under Article 2 (1) or services referred to in each subparagraph of paragraph (2) of the same Article.
(2) "Amount prescribed by Presidential Decree" in Article 2 (1) 8 (b) of the Act means two trillion won.
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 3-3 (Criteria for Exercise of de facto Influence and Participation in Management)   print
(1) A person who exercises de facto influence over the major affairs of management pursuant to Article 2 (1) 9 (b) and 10 (b) of the same paragraph of the Act shall be either of the following:
1. A stockholder who has appointed the representative or more than half of the directors of a financial holding company (referring to a bank holding company in cases of Article 2 (1) 10 (b) of the Act) on his/her own or by means of the agreement, contract, etc. with other stockholders;
2. A person who has been designated by the Financial Services Commission and recognized as exercising dominant influence over major decision-making or business execution, such as management strategies and changes of organization, of a financial holding company, its subsidiaries and second-tier subsidiaries [in cases of Article 2 (1) 10 (b) of the Act, referring to a bank holding company, its subsidiaries and second-tier subsidiaries (hereinafter referred to as "bank holding company, etc.")].
(2) A person who participates in the management of the relevant financial institution as a non-financial devotee through the appointment or dismissal of executives under Article 2 (1) 10 (b) of the Act shall be a person falling under any of the following subparagraphs:
1. Where the aggregate of the numbers under each item is not less than the number prescribed and publicly notified by the Financial Services Commission, the relevant stockholder:
(a) Where the stockholder has appointed a director of a bank holding company or a bank which is a subsidiary, etc. of the bank holding company on his/her own or by means of the agreement, contract, etc. with other stockholders, the number of the directors appointed;
(b) Where the relevant stockholder and his/her specially related persons (if the relevant stockholder and his/her specially related persons are corporations, including the employees thereof) become directors (including persons falling under Article 401-2 (1) 3 of the Commercial Act) of the relevant bank holding company or a bank which is a subsidiary, etc. of the bank holding company, the number of the directors;
2. A person eligible to restrict the authority of the representative or director of a bank holding company, etc. with respect to major decision-making such as management strategies and changes of organization, or business execution such as asset management, by means of the agreement, contract, etc. of the relevant bank holding company, etc.;
3. Others who have been designated by the Financial Services Commission and recognized as being involved in major decision-making or business execution of the relevant bank holding company, etc.
[This Article Wholly Amended by Presidential Decree No. 21776, Oct. 9, 2009]
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 Article 3-4 Deleted. <by Presidential Decree No. 21998, Jan. 18, 2010>   print
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 Article 4 (Application for Authorization)   print
(1) A person who intends to obtain authorization under Article 3 (1) of the Act shall file an application in which matters in the following subparagraphs are stated, with the Financial Services Commission: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Trade names of the financial holding company and its subsidiaries, etc. (hereinafter referred to as "financial holding company, etc.");
2. Location of the main office of the financial holding company, etc.;
3. Names, resident registration numbers and addresses of the representative and officers of the financial holding company, etc.;
4. Matters concerning the capital of the financial holding company, etc.;
5. Matters concerning human resources and physical facilities of the financial holding company, etc.;
6. Types of business run by subsidiaries, etc.
(2) The following documents shall be attached to the application for authorization under paragraph (1). In this case, the Financial Services Committee shall verify a corporation registration certificate of a subsidiary, etc. by sharing administrative information under Article 36 (1) of the Electronic Government Act: <Amended by Presidential Decree No. 18312, Mar. 17, 2004; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 22151, May 4, 2010; Presidential Decree No. 22467, Nov. 2, 2010>
1. Articles of incorporation of the financial holding company, etc.;
2. Business plans (including estimated financial statements) and statement of accounts concerning future earning for the upcoming three business years of the financial holding company, etc.;
3. Documents in which the locations and names of the main office, branch office, etc. of the financial holding company, etc. are stated;
4. Deleted; <by Presidential Decree No. 22467, Nov. 2, 2010>
5. Financial statements and documents annexed thereto, of the financial holding company, etc.;
6. Curriculum vitae and career certificates of officers of the financial holding company, etc.;
7. Names or titles of stockholders holding 1/100 or more of the total number of issued stocks of the financial holding company, etc. as of the date of application for authorization and a document indicating the number of such stocks;
8. Other documents necessary for the examination of requirements for authorization under the Act and this Decree, as determined by the Financial Services Commission.
(3) Notwithstanding paragraphs (1) and (2), a person who intends to obtain authorization under paragraph (1) and whose largest stockholder is the Government or any institution falling under any of subparagraphs 1 through 3 of Article 5 (3) may neither provide the information required under paragraph (1) 5 nor attach the document required under paragraph 2 (2). <Newly Inserted by Presidential Decree No. 22509, Dec. 2, 2010>
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 Article 5 (Detailed Criteria for Authorization)   print
(1) The business plan of a financial holding company, etc. under subparagraphs 1 and 2 of Article 4 (1) of the Act shall meet all the criteria set forth in the following subparagraphs: Provided, That the criteria referred to in subparagraph 1 may not apply to a person who intends to obtain authorization whose largest stockholder is the Government or any institution falling under any of subparagraphs 1 through 3 of paragraph (3): <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22509, Dec. 2, 2010>
1. The business plan shall be appropriate for the continuous operation of the relevant business; and the estimated financial statements and its forecasts for earnings shall have validity in light of the business plan;
2. The method of procurement of funds, such as the capital to be used for the promotion of the business plan, shall be appropriate;
3. No business plan may violate Acts and subordinate statutes, and there shall be no concern to disrupt the sound order of the financial market;
4. Deleted; <by Presidential Decree No. 21998, Jan. 18, 2010>
4-2. Where a subsidiary which is a foreign corporation intends to control a second-tier subsidiary, such second-tier subsidiary shall not be a domestic financial institution;
5. No substantial restrictions on competition in the relevant markets may be imposed.
(2) "Persons who are determined by Presidential Decree" in Article 4 (1) 3 of the Act means persons who fall under any of the following subparagraphs: <Amended by Presidential Decree No. 20367, Nov. 12, 2007>
1. The largest stockholder of a corporation which is the largest stockholder;
2. The representative of a corporation which is the largest stockholder;
3. Stockholders who exercise de facto influence over major managerial affairs of a corporation which is the largest stockholder.
(3) Large stockholders shall meet the requirements set forth in attached Table 1: Provided, That the foregoing shall not apply to cases which fall under any of the following subparagraphs: <Amended by Presidential Decree No. 17716, Aug. 21, 2002; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 21518, May 29, 2009; Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 22509, Dec. 2, 2010>
1. The Korea Finance Corporation under the Korea Finance Corporation Act (hereinafter referred to as "Korea Finance Corporation");
2. The Korea Deposit Insurance Corporation established under the Depositor Protection Act (hereinafter referred to as "Korea Deposit Insurance Corporation");
3. The Korea Asset Management Corporation established under the Act on the Efficient Disposal of Non-Performing Assets, etc. of Financial Institutions and the Establishment of Korea Asset Management Corporation;
4. The Korea Development Bank established under the Korea Development Bank Act;
5. A person who becomes a large stockholder by means of an all-inclusive share swap under Article 360-2 of the Commercial Act (hereinafter referred to as "share swap") or all-inclusive share transfer under Article 360-15 of the said Act (hereinafter referred to as "share transfer"): Provided, That a person who becomes the largest stockholder, holding 10/100 or more on his/her own or together with a specially related person (15/100 in cases of a local bank holding company)" of the total number of issued stocks with voting rights of a financial holding company by means of share swap or share transfer, shall be excluded herefrom;
6. The largest stockholder or stockholder who is a specially related person to the largest stockholder who holds less than 1/100 of the total number of issued stocks with voting rights of a financial holding company: Provided, That the foregoing shall not apply to a person who has de facto influence on major management matters and is determined and publicly announced by the Financial Services Committee.
(4) The detailed criteria for the financial standing and soundness of business management conditions under Article 4 (1) 4 of the Act shall be as follows: <Amended by Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20653, Feb. 29, 2008>
1. The equity capital of a financial holding company, etc. shall meet the criteria for capital adequacy determined and announced by the Financial Services Commission under subparagraph 1 of Article 28;
2. The business management condition of such subsidiary, etc. shall be sound as discovered from an assessment of the soundness of business management of subsidiaries, etc. conducted as determined and announced by the Financial Services Commission.
(5) The ratio of share swap (the ratio obtained by dividing the highest price by the lowest price from among the share swap price of the company which becomes a complete parent company and swap price of the company which becomes a complete subsidiary) in cases of share swap or share transfer under Article 4 (1) 5 of the Act shall be determined, based on the prices in the following subparagraphs (where a listed stock company under the Financial Investment Services and Capital Markets Act (hereinafter referred to as "listed stock company") is unable to calculate the price under subparagraph 1 or 2 (a), the price under subparagraph 2 (b)): Provided, That such ratio may be adjusted within the scope of 30/100 as agreed between the companies which are relevant parties of the share swap or share transfer: <Amended by Presidential Decree No. 17291, Jul. 7, 2001; Presidential Decree No. 17716, Aug. 21, 2002; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21291, Feb. 3, 2009; Presidential Decree No. 21998, Jan. 18, 2010>
1. The price calculated under Article 176-5 (1) 1 of the Enforcement Decree of the Financial Investment Services and Capital Markets Act in cases of share swap or share transfer between listed stock companies;
2. The price based on the criteria set forth in the following items in cases of share swap or share transfer between a listed stock company and a corporation which is not a listed stock company:
(a) The price calculated under Article 176-5 (1) 2 (a) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act in cases of a listed stock company;
(b) The price calculated under Article 176-5 (1) 2 (b) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act in cases of a corporation which is not a listed stock company;
3. The price calculated under Article 176-5 (1) 2 (b) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act in cases of share swap or share transfer between corporations which are not listed stock companies.
(6) The price calculated under paragraph (5) 2 shall be appraised by an outside appraisal organization for its propriety under Article 176-5 (6) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act: Provided, That the foregoing shall not apply where the ratio of share swap is determined, based on the price calculated under Article 176-5 (1) 1 of the Enforcement Decree of the Financial Investment Services and Capital Markets Act by a KOSDAQ-listed corporation (referring to a corporation which issues stocks listed on the KOSDAQ under the Financial Investment Services and Capital Markets Act) under Article 84-7 (1) 1 of the Enforcement Decree of the Securities and Exchange Act. <Amended by Presidential Decree No. 17291, Jul. 7, 2001; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21291, Feb. 3, 2009>
(7) The Financial Services Commission may establish detailed criteria for the detailed requirements under paragraphs (1) through (6). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
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 Article 5-2 (Reporting of Financial Holding Company Subject to Authorization, etc.)   print
(1) "Unavoidable causes prescribed by Presidential Decree" in Article 5-2 (1) of the Act means cases which fall under any of the following subparagraphs: <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 20947, Jul. 29, 2008>
1. Where the stock value of a subsidiary has increased;
2. Where the stockholders' rights of a subsidiary have changed because of reduction of the capital of the subsidiary, disposal of stocks held by other stockholders, or other causes equivalent thereto as determined and announced by the Financial Services Commission;
3. Where the total amount of assets of the financial holding company subject to authorization under Article 5-2 of the Act (hereinafter referred to as a "financial holding company subject to authorization") has decreased;
4. Where a financial holding company subject to authorization has come to hold the stocks of a subsidiary because of the exercise of security rights, acceptance of payment in kind, testamentary gift or other causes equivalent thereto as determined and announced by the Financial Services Commission;
5. Where a financial holding company subject to authorization has come to hold the stocks of a subsidiary in the course of conducting the business of acquisition of securities under Article 9 (11) of the Financial Investment Services and Capital Markets Act with the permission of the Financial Services Commission;
6. Where a financial institution which falls within the financial holding company subject to authorization comes to hold the stocks of a subsidiary within the scope of operations or asset management under the Acts and subordinate statutes applicable to such financial institution, as determined and announced by the Financial Services Commission.
(2) "Period determined by Presidential Decree" in Article 5-2 (1) of the Act means four months from the base date (the base date under the proviso to Article 2 (4) 2 is not applicable; hereinafter the same shall apply). <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
(3) "Period determined by Presidential Decree" in the main sentence of Article 5-2 (2) of the Act means one year from the base date. <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 5-3 (Control Relationship between Financial Institution and Financial Holding Company)   print
"Control relationship prescribed by Presidential Decree" in the main sentence of Article 7 (1) of the Act with the exception of its subparagraphs means that a financial institution actually controls the business matters of a financial holding company according to the standards under Article 3 of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act.
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 5-4 (Requirements for Permission of Control Relationship between Financial Holding Company and Another Financial Holding Companies)   print
(1) Where a financial holding company intends to establish a control relationship with another financial holding company in accordance with Article 7 (1) 1 of the Act, it shall meet all of the following requirements:
1. The financial holding company is required to hold the total number of issued stocks of another financial holding company (hereinafter referred to as an "intermediary holding company") with which it intends to establish a control relationship: Provided, That the foregoing shall not apply where a control relationship is intended to be established with an intermediary holding company to be established by means of share swap or share transfer and the requirements in each of the following items are satisfied:
(a) The financial holding company is required to hold 95/100 or more of the total number of issued stocks of the intermediary holding company;
(b) The financial holding company is required to be unable to acquire the total number of issued stocks of the intermediary holding company due to unavoidable causes, such as cases where, although the financial holding company has requested a person to be another stockholder of the intermediary holding company (hereafter referred to as a "minority stockholder" in this item) to sell such stocks, such minority stockholder fails to sell such stocks within two months from his/her receipt of such request for sale or the unknown whereabouts of such minority stockholder;
2. The subsidiaries controlled by the same intermediary holding company (excluding intermediary holding companies which control only subsidiaries which are foreign corporations) are required to operate the same type of business or business operationally related to one another: Provided, That the foregoing shall not apply for two years from the date of being included into an intermediary holding company when there exists any subsidiary whose type of business is different from or is operationally unrelated to other subsidiaries at the time of being included into such intermediary holding company;
3. The intermediary holding company is required not to control second-tier subsidiaries: Provided, That where an intermediary holding company controls subsidiaries which are foreign corporations only, it may control second-tier subsidiaries.
(2) The Financial Services Commission may determine and announce detailed requirements in each of the subparagraphs of paragraph (1). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 5-5 (Requirements for Permission of Control Relationship between Investment Companies, etc. and Financial Holding Companies)   print
(1) Where an investment company under the Financial Investment Services and Capital Markets Act (hereinafter referred to as an "investment company"), private equity fund, or special purpose company under the said Act (hereinafter referred to as a "special purpose company") intends to establish a control relationship with respect to a financial holding company pursuant to Article 7 (1) 2 of the Act, the relevant investment company, private equity fund or special purpose company shall meet each of the following requirements: <Amended by Presidential Decree No. 20947, Jul. 29, 2008>
1. In cases of investment companies, all of the following requirements shall be satisfied:
(a) The number of stocks held by a financial institution must be under 30/100 of the total number of issued stocks of the relevant investment company;
(b) No financial institution may exercise dominant influence over the major managerial affairs of the relevant investment company;
2. In cases of private equity funds, all of the following requirements shall be satisfied:
(a) No financial institution may be a managing partner of a private equity fund;
(b) The shares held by a financial institution must be under 30/100 of the total amount of investment of the relevant private equity fund;
(c) No financial institution may exercise dominant influence over the major managerial affairs of the relevant private equity fund;
3. In cases of special purpose companies, all of the following requirements shall be satisfied:
(a) Each private equity fund which is a stockholder or partner of the relevant special purpose company must meet all of the requirements in each item of subparagraph 2;
(b) The number of stocks or shares held by a financial institution must be under 30/100 of the total number of issued stocks with voting rights or total amount of investment of the relevant special purpose company;
(c) No financial institution may exercise dominant influence over the major managerial affairs of the relevant special purpose company.
(2) The Financial Services Commission may determine and announce detailed criteria for the requirements in each of the subparagraphs of paragraph (1). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 5-6 (Requirements for Foreign Financial Institutions)   print
(1) "Foreign financial institutions prescribed by Presidential Decree" in Article 7 (1) 3 of the Act means companies and specially related persons thereto (hereinafter referred to as "foreign financial holding companies") which control companies conducting banking business, financial investment business, insurance business and other business equivalent thereto as determined and announced by the Financial Services Commission in foreign countries (hereafter referred to as "business companies" in this Article) through holding stocks or exercising a dominant influence by means of appointment and dismissal of officers, etc. in order to manage the operation of the business companies. <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
(2) A company holding the stocks of a domestic financial holding company or a company exercising a dominant influence thereon from among foreign financial holding companies shall meet all of the following requirements: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. The total amount of assets, scale of business, etc. must be appropriate for conducting international business activities and have a high international credit rating;
2. The capital adequacy ratio against risk-weighted assets in accordance with the criteria set by the Bank of International Settlements must be 8/100 or more for the last three consecutive years or cases equivalent thereto, which meet the criteria as determined and announced by the Financial Services Commission.
(3) In the application of paragraph (2), in cases where, because the relevant company is not a business company, it is impractical or unreasonable to apply the whole or part of the requirements in each of the following subparagraphs, if there exists a foreign financial holding company which is a business company (limited to a business company which actually controls the management of the relevant company or a business company whose management is actually controlled by the relevant company) satisfying the whole or part of the requirements, the relevant company shall be deemed to satisfy such requirements.
(4) The Financial Services Commission may determine and announce detailed criteria for the requirements in each of the subparagraphs of paragraph (2). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 5-7 (Requirements for Permission for Control Relationship between Foreign Financial Institutions and Financial Holding Companies)   print
(1) Where a foreign financial institution intends to establish a control relationship with a financial holding company pursuant to Article 7 (1) 3 of the Act, it shall satisfy each of the following requirements: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. A foreign financial holding company shall hold the total number of issued stocks of a domestic financial holding company with which the foreign financial holding company intends to establish a control relationship (hereinafter referred to as a "domestic holding company"): Provided, That the foregoing shall not apply where a control relationship is established with a domestic holding company established by means of share swap or share transfer and the requirements in each of the following items are satisfied:
(a) The foreign financial holding company shall hold 95/100 or more of the total number of issued stocks of the domestic holding company;
(b) The foreign financial holding company shall be unable to acquire the total number of issued stocks of the domestic holding company due to unavoidable causes, such as cases where, although the foreign financial holding company requested a person to be another stockholder of the domestic holding company (hereafter referred to as a "minority stockholder" in this item) to sell such stocks, such minority stockholder fails to sell such stocks within two months from his/her receipt of such request for sale or the unknown whereabouts of such minority stockholder;
2. Where there exists a domestic financial institution which is an affiliated company with a foreign financial holding company {excluding the relevant domestic holding company and its subsidiaries and second-tier subsidiaries thereof (hereafter referred to as "domestic holding company, etc." in this subparagraph); hereafter referred to as a "domestic affiliated company" in this subparagraph}, the requirements determined and announced by the Financial Services Commission based on the matters concerning restrictions on the acts of subsidiaries, etc. under Article 48 of the Act for credit extension, asset transactions, stock holding, etc. between domestic affiliated company, domestic holding company, etc. shall be satisfied.
(2) The Financial Services Commission may determine and announce detailed criteria for the requirements in each subparagraph of paragraph (1). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 5-8 (Termination of Control Relationship with Financial Holding Companies, etc.)   print
(1) "Unavoidable causes prescribed by Presidential Decree" in the main sentence of Article 7 (2) of the Act means cases which fall under any of the following subparagraphs: <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 20947, Jul. 29, 2008>
1. Where there is a change in the stockholder's right of such company because of reduction of capital of a financial holding company, disposal of stocks held by other stockholders, or other causes equivalent thereto as determined and announced by the Financial Services Commission;
2. Where a financial institution which has a control relationship with a financial holding company (hereafter referred to as a "controlling financial institution" in this Article) has come to hold the stocks of the financial holding company because of the exercise of security rights, acceptance of payment in substitutes, testamentary gift or other causes equivalent thereto as determined and announced by the Financial Services Commission;
3. Where a controlling financial institution comes to hold the stocks of a financial holding company in the course of conducting the business of acquisition of securities under Article 9 (11) of the Financial Investment Services and Capital Markets Act with the permission of the Financial Services Commission;
4. Where a controlling financial institution comes to hold the stocks of a financial holding company with urgency to the extent of the operation and asset management under the Acts and subordinate statutes applicable to such financial institution as determined and announced by the Financial Services Commission.
(2) "Period determined by Presidential Decree" in the main sentence of Article 7 (2) of the Act means one year from the base date. <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 6 (Approval for Change of Large Stockholders, etc.)   print
(1) "Standards determined by Presidential Decree" in Article 7-2 (1) of the Act means those provided in attached Table 1-2.
(2) A person who intends to become a large stockholder shall meet the standards under paragraph (1): Provided, That the foregoing shall not apply to a person who falls under any of subparagraphs 1 through 4 and 6 of Article 5 (3). <Amended by Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22509, Dec. 2, 2010>
(3) A person who intends to obtain approval under Article 7-2 (1) of the Act shall submit to the Financial Services Commission an application for such approval for change of large stockholders which states each of the following: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Applicant-related matters;
2. Status of holding of stocks issued by a financial holding company which intends to become a large stockholder;
3. Plan on the acquisition of stocks issued by a financial holding company which intends to become a large stockholder.
(4) The application under paragraph (3) shall be accompanied by documents in each of the following subparagraphs: <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 22467, Nov. 2, 2010>
1. Articles of incorporation (limited to corporations);
2. Documents equivalent to a corporation registration certificate in cases of a foreign company;
3. Financial statements as of the end of the latest business year and semi-annual financial statements after the end of the latest business year (limited to corporations);
4. Audit report and review report by an outside auditor on the financial statements under subparagraph 3;
5. Where a person who intends to become a large stockholder is a financial institution, financial conditions calculated according to standards for financial soundness applicable to such financial institution, and the review report thereon by an outside auditor;
6. Other documents necessary for the examination of requirements for approval, as determined by the Financial Services Commission.
(5) Where an application submitted under paragraph (3) is flawed, the Financial Services Commission may file a request for supplementation of the application. In this case, no period of time required to supplement the application may be included in the period of time under paragraph (7). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(6) Upon receipt of an application under paragraph (3), the Financial Services Commission shall verify the following administrative information by sharing administrative information under Article 36 (1) of the Electronic Government Act: Provided, That unless the applicant consents to the verification under subparagraph 2, the applicant shall attach the relevant document thereto (in cases of a certificate of business registration, a copy thereof): <Amended by Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 22151, May 4, 2010; Presidential Decree No. 22467, Nov. 2, 2010>
1. A corporation registration certificate (limited to domestic corporations);
2. A certified copy of a resident registration card or a business registration certificate;
3. A corporation registration certificate of a financial holding company which intends to become a large stockholder.
(7) The Financial Services Commission shall, upon receipt of an application under paragraph (3), confirm as to whether it meets the requirements under paragraph (1) and determine whether to grant approval therefor within 60 days from the date of receipt of the application and immediately notify such fact to the applicant in writing. In such cases, if it disapproves, it shall indicate the reason therefor. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(8) Other detailed matters necessary for the methods and procedures for the application for approval, etc. under Article 7-2 (1) of the Act shall be determined by the Financial Services Commission. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
[This Article Wholly Amended by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 6-2 (Reporting on Status of Stock Holdings, etc.)   print
(1) "Those prescribed by Presidential Decree" in Article 8 (2) of the Act other than each subparagraph shall be any of the following persons:
1. The Government;
2. The Korea Deposit Insurance Corporation;
3. The Korea Finance Corporation (limited to cases where stocks are acquired using the Financial Stability Fund established under the Act on the Structural Improvement of the Financial Industry);
4. A person approved by the Financial Services Commission under Article 8 (3) of the Act where a person who was a stockholder, etc. holding stocks in excess of the limit issued by a bank under Article 16-4 (1) of the Banking Act with approval from the Financial Services Commission under Article 15 (3) of the Banking Act holds stocks, in excess of the limit under Article 10-2 of the Act, issued by a financial holding company which controls the relevant bank as a subsidiary, etc. by means of stock swap or stock transfer.
(2) "Matters prescribed by Presidential Decree" in Article 8 (2) of the Act other than each subparagraph shall be as follows:
1. Matters on the same person;
2. Matters falling under the following categories in cases of a private equity fund, etc. (referring to the private equity fund, etc. under Article 8-5 (1) of the Act; hereinafter the same shall apply):
(a) Stockholders or partners;
(b) Contributions made by a limited partner or general partner of the private equity fund;
3. Matters on the current status of stock holdings or changes thereof, and the reasons therefor;
4. Matters as to the purpose of stock holdings and whether to involve in the management of a bank holding company, etc.;
5. Other detailed matters necessary to confirm the status of stock holdings or changes in the ratio of stock holdings as prescribed and publicly notified by the Financial Services Commission.
(3) A same person who falls under any of the subparagraphs of Article 8 (2) of the Act shall report the matters stated in each subparagraph of paragraph (2) to the Financial Services Committee by the deadline specified in the following subparagraphs. Where the person and his/her specially related person have to report together, whoever has the largest number of stocks may be designated as a representative to make a report under joint signature: <Amended by Presidential Decree No. 22509, Dec. 2, 2010>
1. In cases of Article 8 (2) 1 and 3 of the Act: the 10th of a month following a quarter which includes a date when a reason for reporting occurs (referring to a date on which a relevant person comes to the knowledge of his/her obligation to report if that person becomes subject to reporting despite having failed to acquire or sell stocks of a bank holding company; hereafter the same shall apply in this Article);
2. In cases of Article 8 (2) 2, 4 and 5 of the Act: the 10th of a month following a month in which a reason for reporting occurs.
(4) Notwithstanding paragraph (3) 2, funds, etc. or any other person prescribed and publicly notified by the Financial Services Commission may report by the 10th day of the month immediately following the quarter to which the date when a reason for reporting occurs belongs. <Amended by Presidential Decree No. 22509, Dec. 2, 2010>
(5) In addition to those prescribed in paragraphs (1) through (4), necessary matters regarding reporting on the status, etc. of stock holdings shall be prescribed and publicly notified by the Financial Services Commission.
[This Article Wholly Amended by Presidential Decree No. 21776, Oct. 9, 2009]
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 Article 6-3 (Requirements, Procedure, etc. for Approval for Holding of Stocks in Excess of Holding Limit)   print
(1) A person who intends to hold the stocks of a bank holding company under Article 8 (3) of the Act shall satisfy the requirements provided for in attached Table 2: Provided, That where the Financial Services Commission deems that there exists a special cause, such as liquidation of insolvent financial institutions under subparagraph 3 of Article 2 in the Act on the Structural Improvement of the Financial Industry, it may grant such approval even to a person who fails to satisfy the requirements in attached Table 2. <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008>
(2) In granting approval under Article 8 (3) of the Act, the Financial Services Commission may restrict the timing, method, etc. of acquisition of stocks when it is deemed necessary in light of the applicant's qualifications, distribution of shares held by a bank holding company, etc. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(3) A person who intends to obtain approval under Article 8 (3) of the Act shall file an application for approval with the Financial Services Commission, stating the following: <Amended by Presidential Decree 21776, Oct. 9, 2009>
1. Applicant-related matters;
2. Current status of holding stocks issued by a bank holding company;
3. Plan for acquiring stocks issued by a bank holding company.
(4) The application for approval under paragraph (3) shall include the following documents: <Newly Inserted by Presidential Decree No. 21776, Oct. 9, 2009>
1. Articles of incorporation (limited to corporations);
2. Documents equivalent to the certified transcript of corporate registration, in cases of a foreign company;
3. Financial statements as at the end of the latest business year and semi-annual financial statements after the end of the latest business year (limited to corporations);
4. Audit report and review report on the financial statements under subparagraph 3 prepared by an accounting auditor (referring to an auditor under Article 3 (1) of the Act on External Audit of Stock Companies; hereinafter the same shall apply);
5. Where a person intending to obtain approval is an institution subject to inspection by the Financial Supervisory Service under Article 38 of the Act on the Establishment, etc. of Financial Services Commission, financial status calculated in accordance with the standards for financial soundness applicable to such institution and review report thereof prepared by an accounting auditor;
6. Other documents prescribed and publicly notified by the Financial Services Commission as necessary for the review of requirements for approval.
(5) The Financial Services Commission shall, upon receipt of an application under paragraph (3), verify the administrative information falling under the following subparagraphs by sharing administrative information under Article 36 (1) of the Electronic Government Act: Provided, That unless the applicant consents to the verification under subparagraph 2, the application shall attach the relevant document (in cases of a certificate of business registration, referring to a copy thereof) thereto: <Newly Inserted by Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 22151, May 4, 2010; Presidential Decree No. 22467, Nov. 2, 2010>
1. Certified transcript of corporate registration (limited to domestic corporations);
2. Certified transcript of resident registration card or certificate of business registration;
3. Certified transcript of corporation registration of a bank holding company which intends to acquire stocks.
(6) In addition to those prescribed in paragraphs (3) through (5), necessary details concerning the form of an application for approval on holding stocks issued by a bank holding company, methods and procedures, etc. of an application for approval shall be prescribed and publicly notified by the Financial Services Commission. <Newly Inserted by Presidential Decree No. 21776, Oct. 9, 2009>
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 6-4 (Period for Handling Approval for Holding of Stocks)   print
"Period prescribed by Presidential Decree" in Article 8 (4) of the Act means 60 days from the date of receipt of an application for approval: Provided, That the period prescribed and publicly notified by the Financial Services Commission, such as the period for supplementing defects of the application for approval, shall not be included in calculation. <Amended by Presidential Decree No. 21776, Oct. 9, 2009>
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 6-5 (Period of Time to be Construed as Non-Financial Devotee, etc.)   print
(1) "Period prescribed by Presidential Decree" in Article 8-2 (1) of the Act means three months.
(2) "Requirements of financial soundness, etc. prescribed by Presidential Decree" in Article 8-2 (2) of the Act means the requirements in subparagraph 1 (a) and subparagraph 3 (a) through (c) in attached Table 2-2. <Amended by Presidential Decree No. 21776, Oct. 9, 2009>
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 6-6 (Requirements for Approval for Conversion Plans, etc.)   print
(1) The conversion plan under Article 8-2 (3) 1 of the Act shall meet the requirements in each of the following subparagraphs: <Amended by Presidential Decree No. 21776, Oct. 9, 2009>
1. The assumptions on which the conversion plan is based, such as prospects on the market conditions, etc. are required to be rational;
2. The conversion plan is required to be realizable within the execution period specified in the plan in light of the size of issued stocks, size of assets, etc. of a non-financial company subject to disposal;
3. Quarterly performance plan is required to be included.
(2) The Financial Services Commission shall review the status of execution of conversion plan by a person subject to conversion under Article 8-3 (2) of the Act on a quarterly basis. <Amended by Presidential Decree No. 21776, Oct. 9, 2009>
(3) The Financial Services Commission may prescribe and publicly notify the necessary matters on detailed standards for the requirements under each subparagraph of paragraph (1) and the review of the status of execution of conversion plan, such as review methods under paragraph (2). <Amended by Presidential Decree No. 21776, Oct. 9, 2009>
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 6-7 Deleted. <by Presidential Decree No. 21776, Oct. 9, 2009>   print
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 Article 7 (Requirements, etc. for Prevention of Conflict of Interests of Fund, etc.)   print
(1) "Systems prescribed by Presidential Decree" in Article 8-2 (3) 2 (a) of the Act means systems satisfying all the following requirements:
1. The standards for exercising voting rights to prevent conflicts of interest shall be established. In such cases, the standards shall include the statement that voting rights shall be exercised in a manner that does not influence any resolution made by the number of stocks calculated by subtracting the number of stocks held in excess of the limit under Article 8-2 (1) of the Act among the number of stocks held by the fund, etc. from the number of stocks held by stockholders present at the general meeting of stockholders of the bank holding company which issued the stocks held by the fund, etc. where any voting rights are exercised on the matters which do not have standards for exercising voting rights, when the number of stock of a bank holding company held by the fund, etc. exceeds the limit on the number of stocks specified in Article 8-2 (1) of the Act;
2. The internal control guidelines shall be established in order to verify, assess, and manage the possibility of conflicts of interest, such as cases where the information obtained by a stockholder of a bank holding company shall be managed in order to prevent use of such information for any purposes other than the exercise of stockholders' appraisal rights;
3. Other matters prescribed and publicly notified by the Financial Services Commission as necessary to prevent conflicts of interest.
(2) "Requirements prescribed by Presidential Decree" in Article 8-2 (3) 2 (c) of the Act means cases where the fund, etc. complies with the guidelines for asset management under Article 79 of the State Finance Act.
[This Article Newly Inserted by Presidential Decree No. 21776, Oct. 9, 2009]
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 Article 8 (Approval, etc. of Stock Holdings by Non-Financial Devotees)   print
(1) Where a non-financial devotee is involved in the management of a bank holding company, etc. pursuant to Article 8-4 (1) of the Act, the non-financial devotee shall be a person falling under any of the subparagraphs of Article 3-3 (2).
(2) A non-financial devotee intending to hold stocks of a bank holding company pursuant to Article 8-4 (1) of the Act shall satisfy the requirements under attached Table 2-2.
(3) A non-financial devotee intending to obtain approval pursuant to Article 8-4 (1) of the Act shall file an application for approval with the Financial Services Commission, stating the matters under each subparagraph of Article 6-3 (3).
(4) Documents under each subparagraph of Article 6-3 (4) shall be attached to the application for approval under paragraph (3).
(5) Upon receipt of an application under paragraph (3), the Financial Services Commission shall verify administrative information falling under the following subparagraphs by sharing administrative information under Article 36 (1) of the Electronic Government Act: Provided, That unless the applicant consents to the verification under subparagraph 2, the applicant shall attach the relevant document (in cases of a business registration certificate, a copy thereof) thereto: <Amended by Presidential Decree No. 22151, May 4, 2010; Presidential Decree No. 22467, Nov. 2, 2010>
1. A corporation registration certificate (limited to domestic corporations);
2. A certified copy of a resident registration card or a business registration certificate;
3. A corporation registration certificate of a bank holding company which intends to acquire stocks.
(6) When an application for approval under paragraph (3) is flawed, the Financial Services Commission may file a request for supplementation thereof.
(7) "Unavoidable cause prescribed by Presidential Decree, such as disposal of stocks of other stockholder of a bank holding company" in Article 8-4 (3) of the Act means any of the following cases:
1. Where the stockholders' rights are changed due to causes prescribed and publicly notified by the Financial Services Commission, such as reduction of capital of a bank holding company, disposal of stocks held by other stockholders, or causes equivalent thereto;
2. Where a non-financial devotee comes to hold stocks of a bank holding company due to causes prescribed and publicly notified by the Financial Services Commission, such as the execution of security rights by a non-financial devotee, receipt of payment in substitutes, bequest, or other causes equivalent thereto;
3. Where a non-financial devotee that is an investment trader or investment broker under the Financial Investment Services and Capital Markets Act (hereinafter referred to as "investment trader or investment broker") comes to hold stocks of a bank holding company in the course of carrying out a securities underwriting business under Article 9 (11) of the said Act;
4. Where a non-financial devotee comes to hold stocks of a bank holding company urgently within the scope of business or asset management under Acts and subordinate statutes, as prescribed and publicly notified by the Financial Services Commission.
(8) "Period prescribed by Presidential Decree" in Article 8-4 (3) of the Act means five days (the days prescribed and publicly notified by the Financial Services Commission, such as the Workers' Day under the Designation of Workers' Day Act shall not be included in the calculation) from the date any cause falling under any of the subparagraphs of paragraph (7) (if a non-financial devotee fails to acquire or sell stocks of a bank holding company, referring to the date such cause has been known; hereafter the same shall apply in paragraph (9)) occurs.
(9) "Period prescribed by Presidential Decree" in the main sentence of Article 8-4 (4) of the Act other than each subparagraph means six months from the date the corresponding cause occurs.
(10) "Period prescribed by Presidential Decree" in Article 8-4 (5) of the Act means 30 days from the date an application for approval is filed: Provided, That the period prescribed and publicly notified by the Financial Services Commission, such as the period for supplementing defects of an application for approval, shall not be included in the calculation.
(11) In addition to specific standards for requirements under paragraph (2) and matters specified in paragraphs (3) through (6), necessary matters concerning the methods of and procedures for filing an application for approval on stock holdings shall be prescribed and publicly notified by the Financial Services Commission.
[This Article Newly Inserted by Presidential Decree No. 21776, Oct. 9, 2009]
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 Article 9 (Approval, etc. on Stock Holdings of Private Equity Fund, etc.)   print
(1) Where a private equity fund, etc. involves in the management of a bank holding company, etc. pursuant to Article 8-5 (1) of the Act, the private equity fund, etc. shall be a person falling under any of the subparagraphs of Article 3-3 (2).
(2) A private equity fund, etc. under Article 8-5 (1) or (2) of the Act shall have executive partners of the private equity fund, etc. or executives of the executive partners (including those falling under Article 401-2 (1) 3 of the Commercial Act; hereafter the same shall apply in this paragraph) who satisfy all of the following requirements:
1. The executive partner shall be a corporation and three years shall have passed since the incorporation of the relevant corporation;
2. The executives of the executive partners shall not fall under any of the subparagraphs of Article 38 (1) of the Act;
3. The standards under the following items shall be satisfied: Provided, That the foregoing shall not apply where the Financial Services Commission deems the degree of violation, etc. is minor:
(a) The person shall not have been subject to criminal punishment equivalent to or heavier than a sentence of fine for a violation of the Act, this Decree, finance-related Acts and subordinate statutes specified in the subparagraphs of Article 17 (1) (hereinafter referred to as "finance-related Acts and subordinate statutes"), the Monopoly Regulation and Fair Trade Act, or the Punishment of Tax Evaders Act for the latest five years;
(b) The person shall not be a stockholder or his/her specially related person of an institution which was designated as an insolvent financial institution under the Act on the Structural Improvement of the Financial Industry or whose permission or authorization of business is revoked under the Act or finance-related Acts and subordinate statutes for the latest five years: Provided, That persons who, by a court ruling, are found to have no liability for insolvency or who meet the standards prescribed and publicly notified by the Financial Services Commission, such as sharing of economic burdens resulting from insolvency, shall be excluded herefrom;
4. The person is or has been an executive partner or the private equity fund, etc. falling under either of the following items:
(a) Where the value (excluding the value invested by the relevant executive partner) of investment in one private equity fund, etc. is not less than the amount prescribed and publicly notified by the Financial Services Commission, which is not less than 500 billion won;
(b) Where the value (excluding the value invested out of the value invested by the relevant executive partner) of actual investment in more than two companies subject to investment by investing in a private equity fund, etc. by a stockholder or partner without selecting the subject of asset management in advance with respect to one private equity fund, etc. is not less than the amount prescribed and publicly notified by the Financial Services Commission, which is not less than 300 billion won;
5. Other standards prescribed and publicly notified by the Financial Services Commission as details necessary for the capability to manage assets, experience, social standings, etc.
(3) "Information or data prescribed by Presidential Decree, such as any other terms of contracts concluded between the stockholder or partner" in Article 8-5 (3) of the Act means information or data falling under the following subparagraphs:
1. The articles of incorporation of the private equity fund, etc.;
2. Details of contracts concluded between the stockholder or partner of the private equity fund, etc.;
3. The list of stockholders and partners of the private equity fund, etc. (including specially related persons of the stockholders and partners);
4. Other information or data prescribed and publicly notified by the Financial Services Commission as necessary to verify whether the requirements for approval under Article 8-5 (2) of the Act are met.
(4) "Period prescribed by Presidential Decree" in Article 8-5 (4) of the Act means 30 days from the date the application for approval is received: Provided, That the period prescribed and publicly notified by the Financial Services Commission, such as the period for supplementing defects of the application for approval, shall not be included in the calculation.
(5) Article 6-3 (3) through (6) shall apply mutatis mutandis to approval on holding stocks of financial institutions by a private equity fund, etc.
[This Article Newly inserted by Presidential Decree No. 21776, Oct. 9, 2009]
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 Article 10 (Procedures for Reviewing Suitability of Stockholders Holding Stocks in Excess of Limit, etc.)   print
(1) The Financial Services Commission shall, on a semi-annual basis, regularly review whether a stockholder holding stocks in excess of the limit meets the requirements, etc. for excess holding pursuant to Article 10-2 of the Act: Provided, That the Financial Services Commission may, if deemed particularly necessary, conduct an occasional review, such as where there is any sign of illegal trading between the stockholder holding stocks in excess of the limit and a bank holding company, etc.
(2) Details necessary for the methods and procedures, etc. for a review on suitability of stockholders holding stocks in excess of the limit shall be prescribed and publicly notified by the Financial Services Commission.
[This Article Newly Inserted by Presidential Decree No. 21776, Oct. 9, 2009]
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 Article 11 (Business, etc. of Financial Holding Companies)   print
(1) "Business prescribed by Presidential Decree" in Article 15 of the Act means business affairs in each of the following subparagraphs: <Amended by presidential Decree No. 21998, Jan. 18, 2010>
1. Affairs concerning business administration:
(a) Setting of business objectives and approving of business plans with respect to subsidiaries, etc.;
(b) Evaluation of business performance of subsidiaries, etc. and determination of remuneration;
(c) Determination of management governance structure with respect to subsidiaries, etc.;
(d) Inspection of affairs and status of property of subsidiaries, etc.;
(e) Internal control and risk management of subsidiaries, etc.;
(f) Affairs incidental to items (a) through (e);
2. Affairs incidental to business administration:
(a) Financial support to subsidiaries, etc.;
(b) Procurement of funds for investment in subsidiaries or providing financial support to subsidiaries, etc.;
(c) Provision of resources necessary for the business of subsidiaries, etc., including clerical support, etc. for the development and sale of joint products of subsidiaries, etc.;
(d) Business entrusted by subsidiaries, etc. to support the business of such subsidiaries, etc., including computer-related affairs, judicial affairs, accounting, etc.;
(e) Other affairs which do not require authorization, license or approval, etc. under Acts and subordinate statutes.
(2) Details concerning paragraph (1) 2 (c) and (d) are as described in attached Table 3. <Newly Inserted by presidential Decree No. 21998, Jan. 18, 2010>
[This Article Wholly Amended by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 12 (Approval for Inclusion of Company as Subsidiaries, etc.)   print
(1) A person who intends to obtain approval for inclusion of a subsidiary, etc. under Article 16 (1) of the Act shall submit to the Financial Services Commission an application for approval, stating the following: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Trade name of a company (hereinafter referred to as a "company subject to inclusion") which aims to be included into a financial holding company and a subsidiary, etc.;
2. Location of the head office of a financial holding company and a company subject to inclusion;
3. Names, resident registration numbers and addresses of the representative and officers of a financial holding company and a company subject to inclusion;
4. Matters concerning the capital of a financial holding company and a company subject to inclusion;
5. Matters concerning personnel and physical facilities of a financial holding company and a company subject to inclusion;
6. Type of business to be conducted by a company subject to inclusion.
(2) An application for approval under paragraph (1) shall be accompanied by the following documents. In this case, the Financial Services Committee shall verify the corporation registration certificates of a financial holding company and a company subject to inclusion by sharing administrative information under Article 36 (1) of the Electronic Government Act: <Amended by Presidential Decree No. 18312, Mar. 17, 2004; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 22151, May 4, 2010; Presidential Decree No. 22467, Nov. 2, 2010>
1. Articles of incorporation of a financial holding company and a company subject to inclusion;
2. Business plans (including estimated financial statements) and estimated statement of expected profit and loss of a financial holding company and a company subject to inclusion for the upcoming three business years after the company subject to inclusion has been included into a subsidiary, etc.;
3. Documents stating the locations and names of the main office, branch office, etc. of a financial holding company and a company subject to inclusion;
4. Deleted; <by Presidential Decree No. 22467, Nov. 2, 2010>
5. Financial statements and documents annexed thereto of a financial holding company and a company subject to inclusion;
6. Curriculum vitae and career certificates of officers of a financial holding company and a company subject to inclusion;
7. Names or titles of stockholders holding 1/100 or more of the total number of stocks issued by a financial holding company and a company subject to inclusion as at the date of application for approval and a document stating the number of such stocks: Provided, That where a company subject to inclusion is a private equity fund, the name and title of a limited partner which is not a subsidiary, etc. may be omitted;
8. Other documents necessary for the examination of requirements for approval under the Act and this Decree, as determined by the Financial Services Commission.
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 Article 13 (Detailed Requirements for Approval for Inclusion into Subsidiaries, etc.)   print
(1) The business plan under Article 17 (1) 1 of the Act shall meet each of the following requirements: <Amended by Presidential Decree No. 17716, Aug. 21, 2002; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20367, Nov. 12, 2007>
1. The business plan shall be appropriate for the continuous operation of business and maintenance of sound management of a financial holding company and a company subject to inclusion, and the estimated financial statements and its forecasts for earnings shall have validity in light of the business plan;
2. The method of procurement of funds, such as the capital to be used for the promotion of the business plan, shall be appropriate;
3. No business plan may violate Acts and subordinate statutes, and there shall be no concern to disrupt the sound order of the financial market;
4. Deleted; <by Presidential Decree No. 21998, Jan. 18, 2010>
4-2. Where a foreign corporation to be included into a subsidiary intends to control a second-tier subsidiary, or the foreign subsidiary intends to include a second-tier subsidiary, such second-tier subsidiary shall not be a domestic financial institution;
5. No substantial restrictions on competition in the relevant markets may be imposed.
(2) Detailed criteria for the soundness of financial standing and business management conditions under Article 17 (1) 2 of the Act shall be as follows: <Amended by Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20653, Feb. 29, 2008>
1. The equity capital of a financial holding company, etc. and a company subject to inclusion shall meet the criteria for capital adequacy determined and announced by the Financial Services Commission under subparagraph 1 of Article 28;
2. The business management conditions of a financial holding company, etc. and a company subject to inclusion shall be sound based on the outcomes of an assessment conducted as determined and announced by the Financial Services Commission as to whether the financial holding company, etc. and the company subject to inclusion have sound business management.
(3) The provisions of Article 5 (5) shall apply mutatis mutandis with respect to the propriety of the ratio of share swap under Article 17 (1) 3 of the Act.
(4) The Financial Services Commission may establish detailed criteria for the detailed requirements in paragraphs (1) through (3). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
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 Article 14 (Scope of Companies Subject to Reporting, etc.)   print
(1) "Company prescribed by Presidential Decree" in Article 18 (1) of the Act means a financial institution or a company, which falls under any of the following subparagraphs: Provided, That where a subsidiary includes a second-tier subsidiary (excluding cases where a subsidiary becomes a managing partner of a private equity fund), and the subsidiary owns less than 50/100 of the total number of stocks issued by the second-tier subsidiary included [30/100 where such second-tier subsidiary is a listed stock company or joint stock company under Article 43-2 (1) of the Act (hereafter in this paragraph referred to as "joint stock company")], such second-tier subsidiary (except for a foreign corporation in case of subparagraph 2) shall be excluded; and where a second-tier subsidiary includes a third-tier subsidiary, and the second-tier subsidiary owns less than 50/100 of the total number of stocks issued by the third-tier subsidiary included (30/100 where such third-tier subsidiary is a listed stock company or joint stock company), such third-tier subsidiary (excluding a foreign corporation in cases of subparagraph 2) shall be excluded; and the same shall also apply where a third- or lower-tier subsidiary includes even lower-tier subsidiaries: <Amended by Presidential Decree No. 17716, Aug. 21, 2002; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22509, Dec. 2, 2010>
1. A financial institution which does not require authorization or permission from the Financial Services Commission at the time of the establishment of the relevant financial institution {Provided, That foreign corporations which are to be included into subsidiaries or second-tier subsidiaries (limited to companies controlled by a subsidiary which is a foreign corporation) of financial holding companies and mainly operate the same types of business as those of domestic financial institutions for which the authorization or permission of the Financial Services Commission are required shall be excluded herefrom};
2. A financial institution the total amount of assets of which is under 100 billion won as at the end of the latest business year;
3. Where a subsidiary, etc. of a financial holding company as at the time of authorization under Article 3 of the Act or a subsidiary, etc. newly included under Article 16 of the Act becomes a subsidiary, etc. of a financial holding company because of change in the relationship of stock holding between financial holding companies, etc., merger, division, merger through split-off, physical division between subsidiaries, etc., and other causes determined and announced by the Financial Services Commission, such subsidiary, etc.:
(a) Deleted; <by Presidential Decree No. 21998, Jan. 18, 2010>
(b) Deleted; <by Presidential Decree No. 21998, Jan. 18, 2010>
4. A company controlled by a creditor financial institution which is a subsidiary, etc. of a financial holding company under Article 29 (1) of the Corporate Restructuring Promotion Act through investment conversion, etc. of claims;
5. A company closely related to the operation of financial business under Article 2 (2).
(2) A financial holding company which has included a company subject to reporting under Article 18 (1) of the Act into its subsidiary, etc. shall submit to the Financial Services Commission a written report stating matters referred to in each subparagraph of Article 12 (1) within 30 days from the date of including the relevant company subject to reporting into its subsidiary, etc. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(3) Documents in each subparagraph of Article 12 (2) shall be attached to the written report under paragraph (2).
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 Article 15 (Scope of Second-Tier Subsidiaries)   print
(1) "Financial institution prescribed by Presidential Decree" in Article 19 (1) 1 of the Act means the following financial institutions: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21765, Oct. 1, 2009; Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 21998, Jan. 18, 2010>
1. Financial institutions established in a foreign country;
2. Financial institutions engaged in conducting business which subsidiaries are able to conduct which do not require authorization, permission, etc. under Acts and subordinate statutes;
3. Where a subsidiary is a bank, merchant bank, an investment trader or investment broker, or insurance company under the Insurance Business Act (hereinafter referred to as an "insurance company"), companies as classified in each of the following items:
(a) Where a subsidiary is a bank or a merchant bank: Credit information companies under the Use and Protection of Credit Information Act, credit card business operators under the Specialized Credit Financial Business Act, trust business entities, investment traders or investment brokers (limited to investment traders or investment brokers dealing with exchange-traded derivatives only under the Financial Investment Services and Capital Markets Act), investment advisory business entities (hereinafter referred to as "investment advisory business entities"), discretionary investment business entities (hereinafter referred to as "discretionary investment business entities"), and collective investment business entities (hereinafter referred to as "collective investment business entities") under the Financial Investment Services and Capital Markets Act;
(b) Where a subsidiary is an investment trader or investment broker: Collective investment business entities, investment advisory business entities, discretionary investment business entities, and investment traders or investment brokers;
(c) Where a subsidiary is an insurance company: Collective investment business entities and financial institutions conducting the business in Article 11 (1) 3 (a) of the Insurance Business Act;
4. Other financial institutions closely related to the business of a subsidiary, as determined by Ordinance of the Prime Minister.
(2) "Company prescribed by Presidential Decree" in Article 19 (1) 2 of the Act means any company under Article 2 (2).
law view
 Article 16 (Application, etc. of Provisions concerning Non-Bank Holding Companies)   print
(1) "Period prescribed by Presidential Decree" in Article 21 (1) of the Act means seven days from the date a non-bank holding company learns it ceases to meet the requirements for financial holding companies under Article 3 of the Act (hereinafter referred to as "requirements for financial holding companies").
(2) "Cases prescribed by Presidential Decree" in Article 21 (2) 1 of the Act means cases where the aggregate of the value of stocks of a subsidiary owned by a company which ceases to meet the requirements for financial holding companies is less than 40/100 of the total amount of assets of the relevant company. In such cases, the value of stocks of a subsidiary and the total amount of assets of the relevant company shall be computed based on the amount indicated in the balance sheet as of the base date.
(3) "Ratio prescribed by Presidential Decree" in Article 21 (2) 2 of the Act means 60/100. In such cases, the total amount of assets of a non-bank holding company, its subsidiaries, etc. shall be computed based on the amount indicated in the balance sheet as of the base date.
(4) The Financial Services Commission may order any of the following measures pursuant to Article 21 (3) of the Act:
1. Measure for submitting a plan to fulfill the requirements for financial holding companies within three years or to meet all the standards under the subparagraphs of Article 21 (2) of the Act;
2. Measure for modifying a plan under subparagraph 1;
3. Measure for ordering the company which submits a plan under subparagraph 1 to carry out the plan if it fails to do so.
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 16-2 (Approval, etc. of Conversion Plans to Non-Bank Holding Company)   print
(1) A person who intends to obtain approval pursuant to Article 22 (1) of the Act shall submit to the Financial Services Commission a plan to convert into a non-bank holding company (hereafter referred to as "conversion plan" in this Article).
(2) A conversion plan under paragraph (1) shall meet all the following requirements:
1. The assumptions on which the conversion plan is based, such as prospects on the market conditions, etc. are required to be reasonable and rational;
2. A conversion plan shall be realizable within the execution period specified in the plan, in light of investment relationship within the relevant enterprise group, shareholder distribution, etc. of a company subject to conversion under Article 22 (1) of the Act (hereafter referred to as "company subject to conversion" in this Article);
3. A plan to procure funds, including capital, etc. required for implementing the plan shall be appropriate;
4. The details of a conversion plan shall not violate any Acts and subordinate statutes and there shall be no concern to disrupt the sound order of the financial market;
5. An organizational operating system required for implementing and managing a conversion plan shall be in place;
6. Quarterly execution plans shall be included therein;
7. It shall be practical to meet the requirements under subparagraph 1 (b) and (c) of attached Table 4 until a conversion plan is executed;
8. It shall be practical to satisfy the requirements specified in each subparagraph of Article 22 (2) of the Act until a conversion plan is executed.
(3) A company subject to conversion which intends to have a grace period for regulations on restricted activities extended under the proviso to Article 22 (2) of the Act shall file an application for the extension of a grace period with the Financial Services Commission 60 days prior to the date of expiration of the grace period.
(4) The Financial Services Commission shall inspect the execution status of a conversion plan of a company subject to conversion on a quarterly basis pursuant to Article 22 (6) of the Act.
(5) The Financial Services Commission shall, when it orders the execution of a conversion plan pursuant to Article 22 (7) of the Act, do so in writing, stating matters to be executed, a period of execution, etc.
(6) The Financial Services Commission shall, when it issues an order for disposal of stocks pursuant to Article 22 (9) of the Act, do so in writing, stating in detail stocks subject to disposal, number of such stocks, the deadline of disposal, etc.
(7) In addition to the matters provided for in paragraphs (1) through (6), necessary matters concerning the application form for approval of conversion plan, detailed requirements for conversion plan, methods and procedures for applying for the extension of a grace period, quarterly inspection methods, and detailed methods, etc. of issuing a conversion plan execution order and an order for disposal of stocks shall be determined and publicly notified by the Financial Services Commission.
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 16-3 (Detailed Requirements, etc, for Authorization of Insurance Holding Companies)   print
(1) "Requirements prescribed by Presidential Decree" in Article 23 of the Act means the authorization requirements and detailed requirements for an insurance holding company under subparagraph 1 of attached Table 4.
(2) "Requirements prescribed by Presidential Decree" in Article 24 (1) of the Act means the requirements for approval of inclusion of a subsidiary, etc. by an insurance holding company and detailed requirements under subparagraph 2 of attached Table 4.
(3) The Financial Services Commission may determine and publicly notify the details of the detailed requirements under paragraphs (1) and (2).
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 16-4 (Detailed Requirements, etc, for Authorization of Financial Investment Holding Companies)   print
(1) "Requirements prescribed by Presidential Decree" in Article 29 of the Act means the authorization requirements and detailed requirements for a financial investment holding company under subparagraph 1 of attached Table 4.
(2) "Requirements prescribed by Presidential Decree" in Article 30 (1) of the Act means the requirements for approval of inclusion of a subsidiary, etc. by a financial investment holding company and detailed requirements under subparagraph 2 of attached Table 4.
(3) The Financial Services Commission may determine and publicly notify the details of the detailed requirements under paragraphs (1) and (2).
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 16-5 (Restriction, etc. on Trading, etc. with Large Stockholders)   print
(1) "Standards prescribed by Presidential Decree" in the main sentence of Article 34 (2) of the Act means the limit under subparagraph 1 of attached Table 5.
(2) "Standards prescribed by Presidential Decree" in the former part of Article 34 (3) of the Act means the limit under subparagraph 2 of attached Table 5.
(3) Stocks acquired by a non-bank holding company and its subsidiaries, etc. (hereinafter referred to as "non-bank holding company, etc.") by means of a trust for which the operation method of money given in trust is designated by an entrusting person (including a person designated by an entrusting person; hereafter the same shall apply in this paragraph) shall not be construed as stocks acquired (including investment shares) pursuant to Article 34 (3) of the Act: Provided, That the foregoing shall not apply where an entrusting person is a non-bank holding company, etc.
(4) "Period prescribed by Presidential Decree" in Article 34 (4) of the Act means one year: Provided, That the Financial Services Commission may extend the period for up to one year, if deemed necessary in light of the size of stocks held in excess of the limit by a non-bank holding company, etc., the securities market situation, etc.
(5) "Above the standards prescribed by Presidential Decree" in Article 34 (5) and (6) 1 and 2 of the Act means the amount of a single transaction (excluding an amount acquired in an overseas market which is a securities market pursuant to the Financial Investment Services and Capital Markets Act or other similar markets in cases bonds or stocks issued by a large stockholder are acquired under Article 34 (5) of the Act) equivalent to 10/10,000 of the net total amount of the equity capital of the relevant non-bank holding company, etc. or one billion won, whichever is smaller. In such cases, the detailed standards of computing the amount of a single transaction shall be determined and publicly notified by the Financial Services Commission.
(6) The equity capital of a non-bank holding company, etc. and its net total amount under paragraph (5) shall be computed according to the following classifications:
1. Where a non-bank holding company, etc. extends credit to a large stockholder under Article 34 (5) and (6) 1 of the Act: The method prescribed in Article 24 (3) and (4);
2. Where a non-bank holding company, etc. acquires bonds or stocks issued by a large stockholder under Article 34 (5) and (6) 2 of the Act: The method prescribed in Article 24-3 (6) and (7).
(7) A non-bank holding company, etc. shall report to the Financial Services Commission matters classified in the following subparagraphs within one month after the end of each quarter and shall publicly announce them using an Internet homepage, etc., pursuant to Article 34 (7) of the Act:
1. Credit extension to a large stockholder:
(a) The scale of credit extension to a large stockholder as of the end of each quarter;
(b) The increase or decrease of credit extension during each quarter;
(c) Transaction terms and conditions of credit extension;
(d) Other matters determined and publicly notified by the Financial Services Commission;
2. Acquisition of bonds and stocks issued by a large stockholder (the following matters shall be described respectively for bonds and stocks):
(a) The volume of acquired bonds and stocks issued by a large stockholder as of the end of each quarter;
(b) The increase or decrease of retained bonds and stocks during each quarter;
(c) The acquisition price of retained bonds and stocks;
(d) Other matters determined and publicly notified by the Financial Services Commission.
(8) Where an insurance company which is a subsidiary, etc. of a non-bank holding company intends to engage in a transaction falling under any of the following subparagraphs (including a transaction through the brokerage by a third party) with a large stockholder of the relevant non-bank holding company in the amount of a single transaction equivalent to the ratio determined and publicly notified by the Financial Services Commission which is less than 2/100 of the total assets (referring to the total assets on the balance sheet as of the end of the latest business year) of the relevant insurance company pursuant to Article 34 (8) of the Act, it shall report thereon to the Financial Services Commission 30 days prior to the date of transaction, in accordance with the methods and procedures determined and publicly notified by the Financial Services Commission. In such cases, the detailed standards of computing the amount of a single transaction shall be determined and publicly notified by the Financial Services Commission:
1. The transaction of funds, such as credit extension, etc.;
2. The transaction of stocks (including the transaction of stocks issued by a large stockholder);
3. The transaction of real estate, intangible property right, etc.;
4. The transaction of goods, services, etc.
(9) "Acts prescribed by Presidential Decree" in Article 34 (9) 3 of the Act means any of the following acts:
1. Exercising influence over the management of a non-bank holding company, etc., such as demanding early withdrawal of credit extension, to interfere with the business activities of a competing business operator;
2. Receiving credit extension by causing a non-bank holding company, etc. to violate Article 34 (1) of the Act;
3. Receiving credit extension from a non-bank holding company, etc. in excess of the standards prescribed in Article 34 (2) of the Act;
4. Causing a non-bank holding company, etc. to own stocks of a large stockholder in excess of the standards prescribed in Article 34 (3) of the Act;
5. Causing a non-bank holding company, etc. to transfer assets without consideration to, trade or exchange assets with, or extend credit to a large stockholder, in violation of Article 36 (3) of the Act.
(10) "Cases prescribed by Presidential Decree" in the part of Article 34 (10) of the Act other than its subparagraphs means any of the following cases:
1. Where the liabilities of a large stockholder (only applicable to a company) exceed its assets;
2. Where a financial institution (excluding a financial institution of which the relevant large stockholder is a large stockholder) which has provided the largest credit extension to the large stockholder classifies the relevant large stockholder as falling below the criteria determined and publicly notified by the Financial Services Commission, as a result of rating the credit risk of the relevant large stockholder according to Forward-Looking-Criteria (FLC) determined and publicly notified by the Financial Services Commission;
3. Where two or more credit information companies engaged in credit rating service under the Use and Protection of Credit Information Act rate the relevant large stockholder as a non-investment grade.
(11) In computing credit extension under Article 34 (2), (5) and (6) 1 of the Act, credit extension to a large stockholder of a subsidiary, etc. which does not fall under any subparagraph of Article 24 (1) shall be excluded herefrom.
(12) Credit extension under Article 34 (2), (5) and (6) 1 of the Act shall be computed according to the standards prescribed in Article 24 (2).
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 16-6 (Limit, etc. of Credit Extension)   print
(1) "Standards prescribed by Presidential Decree" in the main sentence of Article 36 (1) of the Act means the limit respectively specified in subparagraphs 3 and 4 of attached Table 5.
(2) In computing credit extension under Article 36 (1) of the Act, the credit extension provided for the same borrower of a subsidiary, etc. which does not fall under any subparagraph of Article 24 (1) and the same individual or corporation shall be excluded herefrom.
(3) Credit extension under Article 36 (1) of the Act shall be computed according to the standards prescribed in Article 24 (2).
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 17 (Qualifications of Executives, etc.)   print
(1) "Finance-related Acts and subordinate statutes prescribed by Presidential Decree" in Article 38 (1) 4, 6, 7, and 9 of the Act means Acts in each of the following subparagraphs: <Amended by Presidential Decree No. 17791, Dec. 5, 2002; Presidential Decree No. 18297, Feb. 28, 2004; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21518, May 29, 2009; Presidential Decree No. 21776, Oct. 9, 2009; Presidential Decree No. 21998, Jan. 18, 2010>
1. The Bank of Korea Act;
2. The Banking Act;
3. The Korea Development Bank Act;
4. The Industrial Bank of Korea Act;
5. The Korea Finance Corporation Act;
6. The Export-Import Bank of Korea Act;
7. The Financial Investment Services and Capital Markets Act;
8. The Insurance Business Act;
9. The Secured Bond Trust Act;
10. The Electronic Financial Transactions Act;
11. The Act on Reporting and Using Specified Financial Transaction Information;
12. The Act on External Audit of Stock Companies;
13. The Mutual Savings Banks Act;
14. The Specialized Credit Finance Business Act;
15. The Credit Guarantee Fund Act;
16. The Korea Technology Credit Guarantee Fund Act;
17. The Credit Unions Act;
18. The Agricultural Cooperatives Act;
19. The Fisheries Cooperatives Act;
20. The Community Credit Cooperatives Act;
21. The Support for Small and Medium Enterprise Establishment Act;
22. The Use and Protection of Credit Information Act;
23. The Act on Registration of Credit Business, etc. and Protection of Finance Users;
24. The Foreign Exchange Transactions Act;
25. The Act on the Establishment, etc. of Financial Services Commission;
26. The Asset-Backed Securitization Act;
27. The Special Purpose Companies for Mortgage-Backed Bonds Act;
28. The Act on the Efficient Disposal of Non-Performing Assets, etc. of Financial Institutions and the Establishment of Korea Asset Management Corporation;
29. The Act on Real Name Financial Transactions and Guarantee of Secrecy;
30. The Foreign Investment Promotion Act;
31. The Act on the Structural Improvement of the Financial Industry;
32. The Act on the Regulation of Conducting Fund-raising Business without Permission;
33. The Depositor Protection Act;
34. The Korea Housing Finance Corporation Act;
35. The Registration of Bonds and Debentures Act;
36. The Industrial Development Act;
37. Foreign finance-related Acts and subordinate statutes corresponding to the Act and subparagraphs 1 through 36.
(2) "Person prescribed by Presidential Decree" in Article 38 (1) 7 of the Act means any person who is an officer or employee (in cases of a corporation or company for which permission, authorization, etc. have been cancelled under Article 14 of the Act on the Structural Improvement of the Financial Industry, an officer and employee as at the time a reason for prompt corrective action under Article 10 of the said Act have occurred) as at the time a reason for the revocation of permission, authorization, etc. of business occurs and falls under any of the following subparagraphs: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
1. Any auditor or member of the Audit Committee;
2. Any officer who has been subject to measures, such as demand for caution, warning, suspension of execution of duty, advice of dismissal, and others, by the Financial Services Commission, or the Governor of the Financial Supervisory Service (hereinafter referred to as the "Governor of the Financial Supervisory Service") established under the Act on the Establishment, etc. of Financial Services Commission due to illegal and unjustifiable conduct in connection with the occurrence of a cause which constitutes the revocation of permission, authorization, etc.;
3. Any employee who has been subject to measures, such as demand for suspension from office or a higher disciplinary measure, by the Financial Services Commission or the Governor of the Financial Supervisory Service due to illegal and unjustifiable conduct in connection with the occurrence of a cause which constitutes the revocation of permission, authorization, etc.;
4. Any person subject to sanctions under subparagraph 2 or 3, who had resigned or left office before receiving such sanctions.
(3) "Person who is prescribed by Presidential Decree" in Article 38 (1) 8 of the Act means any person who is recognized to be responsible as a result of investigation by the Governor of the Financial Supervisory Service of a financial institution which is subject to prompt corrective action, etc. under the same subparagraph of the same Article for the ground thereof and falls under any of the following subparagraphs: <Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 21998, Jan. 18, 2010>
1. Any officer who has received an advice of dismissal or order for suspension from execution of duties;
2. Any employee who is subject to disposition of suspension from office or dismissal from office;
3. Any person subject to sanctions under subparagraph 1 or 2 who had resigned or left office before receiving such sanctions.
(4) "Person who is unlikely to conduct acts detrimental to the public interests, sound management, or transaction order of a financial holding company" in Article 38 (2) of the Act means any person who does not fall under any of the following subparagraphs: <Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007: Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
1. Any person who has received a sanction from the Financial Services Commission or the Governor of the Financial Supervisory Service pursuant to the Act or finance-related Acts and subordinate statutes under each subparagraph of Article 17 (1) for whom the period of time as determined and announced by the Financial Services Commission to the extent of not exceeding five years by types of sanction has not passed;
2. Any person who has received a sanction equivalent to that in subparagraph 1 from the institution to which he/she belonged, or supervisory and inspecting institutions, other than the Financial Services Commission and Financial Supervisory Service, during his/her term of office and for whom the period of time as determined in subparagraph 1 has not passed;
3. Any person who has resigned or left office before receiving a sanction because of a cause falling under a sanction in subparagraph 1 or 2 and for whom the period specified in subparagraph 1 for each type of sanction under subparagraph 1 or 2 which the person would have received if the person had continued to hold office or remain employed has not passed from the date on which he/she has resigned or has left office;
4. Any person who is likely to represent the interests of specific transaction companies, etc. in connection with the asset management of a subsidiary, etc. of a financial holding company, having a special relationship with a company which makes credit transactions with such subsidiary, etc.
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 Article 18 (Restrictions, etc. on Concurrent Holding of Office by Executives)   print
(1) No executive who engages in the regular business of a financial holding company under Article 39 (1) of the Act may engage in the regular business of a company which falls under any of the following subparagraphs: <Amended by Presidential Decree No. 17716, Aug. 21, 2002; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
1. Institutions subject to inspection by the Financial Supervisory Service under Article 38 of the Act on the Establishment, etc. of Financial Services Commission;
2. Affiliated companies of the relevant financial holding company: Provided, That companies which are subsidiaries, etc. of the relevant financial holding company shall be excluded herefrom;
3. Any company which is the largest stockholder or a major stockholder of the relevant financial holding company;
4. Any company which received credit extension (referring to credit extension under Article 27 (11)) from the relevant financial holding company, etc.;
5. Other companies that are determined by Ordinance of the Prime Minister and deemed likely to undermine the sound management of a financial holding company when an officer who engages in the regular business of the financial holding company engages in their regular business.
(2) "Standards prescribed by Presidential Decree, such as the suitability of internal control guidelines" in the main sentence of Article 39 (4) of the Act means the standards under the following subparagraphs: <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
1. The internal control guidelines of a financial holding company under Article 41-5 (1) of the Act shall be established;
2. The operating standards for concurrent office-holding by executives and employees of a financial holding company which contain the following items shall be established:
(a) Matters concerning risk management and assessment in regard to concurrent office-holding by executives and employees;
(b) Matters concerning the procedure for commencing and completing concurrent office-holding by executives and employees;
(c) Matters concerning the management and supervision of executives and employees holding concurrently another office;
(d) Matters concerning the protection of customer information (referring to customer information under Article 48-2 (3) of the Act; hereinafter the same shall apply);
(e) Other matters determined and publicly notified by the Financial Services Commission;
3. A financial holding company, its subsidiary, etc. in which an executive or employee holds concurrently another office shall prepare a written confirmation for each of the following items:
(a) The scope of affairs conducted in the company in which an executive or employee holds concurrently another office;
(b) Matters concerning record-keeping on the handling of affairs of the concurrently held office;
(c) The purpose of concurrent office-holding;
(d) The duration of concurrent office-holding;
(e) Other matters determined and publicly notified by the Financial Services Commission as necessary for preventing any conflicts of interest or maintaining the soundness of financial institutions;
4. The details of a written confirmation under subparagraph 3 shall meet the following requirements:
(a) The details shall not undermine soundness in the management of financial institutions;
(b) The details shall not cause any conflicts of interest with customers;
(c) The details shall not undermine the stability of the financial market;
(d) The details shall not disrupt the order of financial transactions.
(3) A financial holding company shall obtain approval from the Financial Services Commission, if concurrent office-holding by executives and employees under Article 39 (2) and the main sentence of Article 39 (3) of the Act falls under any of the following cases: <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
1. Where an employee of a subsidiary, etc. becomes an employee in charge of the affairs under Article 11 (1) 1 (a) through (e) and 2 (a) and (b), among the affairs of the financial holding company controlling the relevant subsidiary, etc. (including cases where an employee of a subsidiary, etc. becomes an employee of a financial holding company through dispatch for at least six months);
2. Where an executive who is in charge of the affairs under any subparagraph of Article 26 (1) at a subsidiary, etc. of a financial holding company concurrently holds office as an executive or employee at another subsidiary, etc.: Provided, That cases where such executive becomes an executive or employee of another subsidiary, etc. engaged in the same type of business (excluding cases where such executive becomes an executive in charge of the affairs under any subparagraph of Article 26 (1)) shall be excluded herefrom;
3. Where an employee who is in charge of the principal business under Article 47 (4) of the Act which can be entrusted pursuant to attached Table 6 at a subsidiary, etc. of a financial holding company concurrently holds office as an executive or employee at another subsidiary, etc.: Provided, That cases where such employee becomes an executive or employee of another subsidiary, etc. engaged in the same type of business (excluding cases where such employee becomes an executive in charge of the affairs under any subparagraph of Article 26 (1)) shall be excluded herefrom.
(4) A financial holding company who intends to obtain approval under paragraph (3) shall submit to the Financial Services Commission an application for approval and accompanying documents determined and publicly notified by the Financial Services Commission. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
(5) The Financial Services Commission shall, upon receipt of an application for approval under paragraph (4), decide whether to grant approval within 30 days from the date of receiving the application for approval and give immediate written notice thereof to the relevant financial holding company after examining whether the standards under paragraph (2) are satisfied: Provided, That a period determined and publicly notified by the Financial Services Commission, such as a period for rectifying any defect, shall not be included in computing a handling period. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
(6) Where concurrent office-holding by executives and employees under Article 39 (2) and the main sentence of Article 39 (3) of the Act does not fall under any subparagraph of paragraph (3), a financial holding company shall prepare the documents determined and publicly notified by the Financial Services Commission and report to the Financial Services Commission no later than seven days prior to the date on which such concurrent office-holding commences. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
(7) Notwithstanding paragraphs (3) and (6), a financial holding company may prepare the documents determined and publicly notified by the Financial Services Commission and report to the Financial Services Commission on the semiannual status on concurrent office-holding by executives and employees within one month after the end of each half-year term, in cases determined and publicly notified by the Financial Services Commission, such as a partial change to already approved or reported matters. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
(8) "Others prescribed by Presidential Decrees" in Article 39 (4) 3 of the Act means the following: <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
1. The purpose of concurrent office-holding;
2. The duration of concurrent office-holding;
3. Other matters determined and publicly notified by the Financial Services Commission as necessary for preventing any conflicts of interest or maintaining the soundness of financial institutions.
(9) In addition to the matters prescribed in paragraphs (2) through (8), necessary detailed matters concerning the methods and procedures for approving and reporting concurrent office-holding by executives and employees shall be determined and publicly notified by the Financial Services Commission. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
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 Article 19 (Appointment of Outside Directors, etc.)   print
(1) "Financial holding company prescribed by Presidential Decree" in Article 40 (1) of the Act means any financial holding company which falls under either of the following subparagraphs: <Amended by Presidential Decree No. 20367, Nov. 12, 2007>
1. Any financial holding company the total amount of assets of which as at the end of the latest business year is 100 billion won or more;
2. Any financial holding company which controls a subsidiary which is required to appoint one-half or more of its directors to be outside directors pursuant to Acts and subordinate statutes.
(2) "Person who has special relationship as prescribed by Presidential Decree" in Article 40 (4) 6 of the Act means any person who falls under any of the following subparagraphs: <Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007>
1. Where the largest stockholder is an individual, any person who falls under any of the following items:
(a) His/her spouse (including a person who is in a de facto marriage; hereinafter the same shall apply);
(b) His/her paternal blood relatives up to second cousins and the spouses of his/her paternal blood relatives up to cousins;
(c) Husbands and children of paternal blood relatives up to uncles or aunts;
(d) Maternal blood relatives up to uncles or aunts and the spouses and children thereof;
(e) Spouse's paternal blood relatives up to siblings and the spouses thereof;
(f) Birth lineal ascendants of an adoptee;
(g) Any person who was adopted within a family and his/her spouse, and lineal descendants of the adoptive family;
(h) The birth mother of a person born out of wedlock;
(i) Any person who maintains his/her living with the money or other property of the largest stockholder or any person who shares means of living with the largest stockholder;
(j) Where the largest stockholder invests 30/100 or more solely or jointly with persons having relationship under items (a) through (i) with him/her, or exercises dominant influence over the major managerial affairs of a corporation or organization, such as appointment and dismissal of officers, the relevant corporation or organization, and the officers thereof;
2. Where the largest stockholder is a corporation or organization, a person who falls under any of the following categories:
(a) Officers;
(b) Affiliated companies and the officers thereof;
(c) Individuals who invest 30/100 or more in the largest stockholder solely or jointly with a person in a relationship under any item of subparagraph 1 with him/her or exercise dominant influence over the major managerial affairs of the largest stockholder, such as appointment and dismissal of officers, and the person in a relationship under any item of subparagraph 1 with him/her, and organizations (excluding affiliated companies; hereafter the same shall apply in this subparagraph) and the officers thereof;
(d) Where the largest stockholder invests 30/100 or more solely or jointly with a person in a relationship under any of items (a) through (c) with him/her or exercises dominant influence over the major managerial affairs of a corporation or organization, such as appointment and dismissal of officers, the relevant corporation or organization and officers thereof.
(3) "Corporation which has important business relationship prescribed by Presidential Decree with the financial holding company concerned, or which is a competitor or collaborator of the financial holding company concerned" in Article 40 (4) 10 of the Act refers to a corporation which falls under any of the following subparagraphs: Provided, That the foregoing shall not apply to both subsidiaries, etc, of the relevant financial holding company and corporations under the proviso to the part other than each subparagraph of Article 28 (2) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act: <Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22509, Dec. 2, 2010>
1. Any corporation the total amount of turnover of which with the relevant financial holding company in the latest three business years is 10/100 or more of the total amount of assets (referring to the total amount of assets in the balance sheet as of the end the latest business year of the relevant financial holding company) or operating profits (referring to the operating profits in the statement of profit and loss as the end of the latest business year of the relevant financial holding company);
2. Any corporation which has established a single trade contract in an amount equivalent to 10/100 or more of the total amount of sales with the relevant financial holding company in the latest business year;
3. Any corporation the sum of the amount of lending or borrowing of money, securities, and other certificates or instruments and the amount of guarantee of debts of which, such as provision of security is 10/100 or more of the capital (referring to the capital in its balance sheet as of the end of the latest business year of the relevant corporation) in the latest business year;
4. Any corporation in which the relevant financial holding company invested 5/100 or more of the capital as of the date of regular general meeting of stockholders of the relevant financial holding company;
5. Any corporation under contract with the relevant financial holding company for technical cooperation;
6. An accounting corporation appointed as an auditor of the relevant financial holding company;
7. Any corporation under contract with the relevant financial holding company for consulting services, such as legal consulting, management consulting;
8. Any corporation under contract related to any business falling under Article 2 (2) 1 through 3 with the relevant financial holding company.
(4) "Person prescribed by Presidential Decree" in Article 40 (4) 12 of the Act means a person who falls under any of the following subparagraphs: <Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22509, Dec. 2, 2010>
1. A person who is or was in the past two years a full-time executive or employee at a corporation which is in a transaction relation falling under any subparagraph of paragraph (3) or in a competitive or cooperative relation in business (excluding the relevant financial holding company, etc. and corporations under the proviso to the part other than the subparagraphs of Article 28 (2) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act) with a subsidiary, etc. of the relevant financial holding company;
2. A person holding office as an outside director, non-permanent director or non-permanent auditor of two or more different listed stock companies other than the relevant financial holding company;
3. An attorney-at-law, certified public accountant or tax accountant who audits the accounts of the relevant financial holding company or its subsidiary, etc., or handles tax affairs on behalf of the relevant financial holding company, or has contracted to provide consulting services, such as legal advice and advice on business management, or person providing other consulting services;
4. A person who has entered into a contract related to any business falling under Article 2 (2) 1 through 3 with a subsidiary, etc. of the relevant financial holding company or who is providing services to the relevant financial holding company or its subsidiary, etc.;
5. A person who holds (referring to holding under Article 133 (3) of the Financial Investment Services and Capital Markets Act) stocks equivalent to 1/100 or more of the total number of issued stocks of the relevant financial holding company or its subsidiary, etc.;
6. A person whose balance of transactions (excluding stereotypical transactions which are made in accordance with standardized contracts under Article 2 (1) of the Act on the Regulation of Terms and Conditions with the relevant financial holding company or its subsidiaries, etc.) with the relevant financial holding company or its subsidiary, etc. is more than 100 million won;
7. A person falling under Article 17 (4) 4;
8. An attorney-at-law, certified public accountant or tax accountant who is involved in any of the following organizations or who has had the experience of serving therein within the latest two years:
(a) A law firm under contract with the relevant financial holding company or its subsidiaries, etc. for consulting services, such as legal consulting, management consulting, etc. (referring to a law firm under Article 31 (2) of the Attorney-at-Law Act);
(b) A law firm partnership under contract with the relevant financial holding company or its subsidiaries, etc. for consulting services, such as legal consulting, management consulting, etc. (referring to a law firm partnership under Article 58-18 of the Attorney-at-Law Act);
(c) An audit team designated as a financial auditor of the relevant financial holding company or its subsidiaries, etc. (referring to an audit team under Article 3 (1) 2 of the Act on External Audit of Stock Companies).
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 Article 19-2 (Audit Committee)   print
"Accounting or financial experts prescribed by Presidential Decree" in Article 41 (2) 2 of the Act means any of the following persons: <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 23644, Feb. 29, 2012>
1. A person qualified as a certified public accountant and has career experience in business related to such qualification for at least five years;
2. A person who has a master's degree, or higher, in finance or accounting and has career experience as a researcher or assistant professor, or higher, at a research institution or university in fields related to finance or accounting for at least five years;
3. A person who has career experience as an executive for at least five years, or as an executive or employee for at least ten years in charge of a finance or accounting-related position at a listed stock company;
4. A person who has career experience of having engaged in finance or accounting, or supervision thereof for at least five years at the State, local governments, public institutions under the Act on the Management of Public Institutions, the Financial Supervisory Service, the Korea Exchange under the Financial Investment Services and Capital Markets Act, or institutions related to financial investment business (excluding organizations related to financial investment) under Article 9 (17) of the Financial Investment Services and Capital Markets Act;
5. A person who has career experience in finance or accounting for at least five years at institutions subject to examination (including foreign financial institutions equivalent thereto) under Article 38 of the Act on the Establishment, etc. of Financial Services Commission.
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 19-3 (Requirements for Management Transparency of Complete Subsidiaries, etc. for which Special Case of Governance is Accepted)   print
Requirements for transparency in management, etc. determined by the Financial Services Commission under Article 41-4 (1) of the Act shall include the following: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Authority and responsibility of the board of directors of a financial holding company with respect to the managerial affairs of a complete subsidiary or a second-tier subsidiary whose total number of issued stocks is held by a complete subsidiary (hereafter referred to as "complete subsidiary, etc." in this Article);
2. Internal control system of a financial holding company which supervises all subsidiaries and second-tier subsidiaries, including complete subsidiaries, etc.
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 19-4 (Internal Control Guidelines)   print
(1) Internal control guidelines under Article 41-5 (1) of the Act shall contain the following:
1. Division of work and organizational structure;
2. Guidelines for managing risks occurring in the course of carrying out affairs;
3. Procedures which shall be complied with by executives and employees, when carrying out their respective affairs;
4. Establishment of a system capable of efficiently transmitting information necessary to carry out management control affairs;
5. Procedures and methods for confirming whether executives and employees comply with the internal control guidelines and disposal of the executives and employees who have violated the internal control guidelines;
6. Procedures and standards to prevent unfair practices, such as reporting on the trade of financial investment instruments (referring to financial investment instruments under Article 3 of the Financial Investment Services and Capital Markets Act; hereinafter the same shall apply) by executives and employees;
7. Procedures of enacting or amending the internal control guidelines;
8. Identifying, assessing and managing of conflicts of interest;
9. Assessment and management as to whether concurrent office-holding by executives and employees under Article 39 (4) of the Act satisfies the requirements under the items of Article 18 (2) 4;
10. Procedures of appointing and dismissing an compliance officer under Article 41-5 (2) of the Act;
11. Assessment and management as to whether the entrustment of business among the subsidiaries, etc. of a financial holding company under Article 47 of the Act satisfies the requirements under the items of Article 26 (2) 4.
(2) If an inspection by the Governor of the Financial Supervisory Service of a financial holding company, etc. reveals that the financial holding company, etc. has violated Acts and subordinate statutes, the Financial Services Commission may recommend amendment of the internal control guidelines to prevent the reoccurrence of a violation of Acts and subordinate statutes.
(3) In addition to the matters prescribed in paragraphs (1) and (2), necessary matters concerning internal control guidelines shall be determined and publicly notified by the Financial Services Commission.
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 19-5 (Qualifications, etc. of Compliance Officers)   print
(1) "Finance-related Acts and subordinate statutes prescribed by Presidential Decree" in Article 41-5 (4) 3 of the Act means Acts and subordinate statutes referred to in the subparagraphs of Article 17 (1).
(2) "Institution prescribed by Presidential Decree" in Article 41-5 (4) 3 of the Act means any of the following institutions:
1. An institution to which a relevant employee belongs;
2. An institution having authority to take a measure equivalent to caution, demand for warning, etc. pursuant to any finance-related Act and subordinate statute under paragraph (1).
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Articles 20-2 and 21 Deleted. <by Presidential Decree No. 21998, Jan. 18, 2010>   print
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 Article 21-2 (Special Cases concerning Standards for Large Stockholders of Subsidiaries, etc. of Financial Holding Company)   print
"Subsidiary, etc. prescribed by Presidential Decree" in subparagraph 3 of Article 42-2 of the Act means a subsidiary, etc. falling under Article 14 (1) 1 or 3.
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 21-3 (Mitigation of Criteria for Holding of Stocks of Foreign Subsidiaries, etc.)   print
(1) "De facto control prescribed by Presidential Decree" in the former part of Article 43-2 (3) of the Act means cases where all of the following requirements are satisfied: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. The financial holding company shall be the largest investor in a subsidiary which is a foreign corporation (hereinafter referred to as "foreign subsidiary");
2. The financial holding company shall not be unreasonably restricted in the exercise of stockholder's rights with respect to its foreign subsidiary in light of the distribution of stocks of the foreign subsidiary, Acts and subordinate statutes of the relevant country, etc.;
3. The financial holding company shall manage the business of its foreign subsidiary by means of appointing its executives and employees as the executives of such foreign subsidiary and other means determined and announced by the Financial Services Commission.
(2) Detailed matters concerning the procedure and method to verify that the financial holding company is able to secure de facto control over its foreign subsidiary under paragraph (1) pursuant to Article 43-2 (3) of the Act may be determined and announced by the Financial Services Commission. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(3) In deciding an investor of a joint stock company under Article 43-2 (1) of the Act, pursuant to Article 43-2 (4) of the Act, a financial holding company, the large stockholder of the financial holding company and its specially related person shall be deemed one investor. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
[This Article Newly Inserted by Presidential Decree No. 20367, Nov. 12, 2007]
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 Article 22 (Cause of Exceeding Limit of Credit Extension)   print
(1) Cases where the total amount of credit provided by a financial holding company, etc. to the same borrower may exceed 25/100 of the net total amount of the equity capital of the financial holding company, etc. due to the cause under Article 45 (1) 1 of the Act shall be as mentioned in each of the following subparagraphs: <Amended by Presidential Decree No. 18736, Mar. 8, 2005; Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 19422, Mar. 29, 2006; Presidential Decree No. 20653, Feb. 29, 2008>
1. Where credit is additionally provided to a company which is undergoing the rehabilitation procedure under the Debtor Rehabilitation and Bankruptcy Act or endeavoring to normalize its management in joint collaboration with a financial institution for the purpose of corporate restructuring, etc.;
2. Where credit is additionally provided to a person who has acquired a company which falls under subparagraph 1 under the conditions determined in the contract of acquisition;
3. Cases recognized by the Financial Services Commission as inevitable for industrial development, such as promotion of infrastructure projects or stabilization of people's livelihood.
(2) Cases where the total amount of credit provided by a financial holding company to the same borrower may exceed 25/100 of the net total amount of equity capital of the financial holding company, etc. due to a cause under Article 45 (1) 2 of the Act shall be as mentioned in each of the following subparagraphs: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Where a financial holding company is newly established;
2. Where any change occurs in the composition of a subsidiary, etc., such as cases where a company which is not a subsidiary, etc. is newly included into a subsidiary, etc.;
3. Where the equity capital of the financial holding company, etc. has decreased;
4. Where the amount converted to won currency has increased due to exchange rate fluctuations;
5. Where any change occurs in the composition of the same borrowers;
6. Where a merger, or transfer and takeover of business occurs between companies to which credit is provided;
7. Other cases recognized by the Financial Services Commission as having exceeded the limit on credit provided by inevitable causes not attributable to the financial holding company, etc., such as rapid change in economic conditions.
(3) "Amount computed according to the method prescribed by Presidential Decree" in the main sentence of Article 45 (3) of the Act means the amount equivalent to 25/100 of the net total amount of equity capital of the financial holding company, etc. or the amount equivalent to the rate of investment made by the same person in the relevant financial holding company, whichever is smaller.
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 Article 23 (Reduction of Excess Credit Provided)   print
(1) Where a financial holding company, etc. exceeds the limit of credit extension under the main sentence other than the subparagraphs of Article 45 (1) of the Act and the main sentence of Article 45 (2) and (3) due to the cause under Article 45 (1) 2 of the Act, it shall take measures to meet the relevant limit on credit extension according to the order provided in the following subparagraphs, within one year from the date on which it exceeds the limit of credit: Provided, That where a financial holding company, etc. has submitted to the Financial Services Commission a detailed plan to meet the limit on credit and obtained approval therefor from the Financial Services Commission, as determined by the Financial Services Commission, it shall comply with the relevant plan: <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
1. Credit offered lately;
2. In cases of credit offered on the same date, the credit the amount of which is smaller.
(2) "In cases of unavoidable causes prescribed by Presidential Decree" in the proviso to Article 45 (4) of the Act means any of the following cases: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Where the recovery of credit within a fixed period of time is difficult because the maturity date of credit already provided has not arrived;
2. Where the causes under subparagraphs 3 and 4 of Article 22 (2) persist for a long term and it is feared that collection of the credit is likely to undermine the management stability of the recipient of such credit;
3. Other cases similar to subparagraphs 1 and 2 where the soundness of assets of the relevant financial holding company is deemed to remain unhampered even if the situation in which the limit on credit providing is exceeded persists for a certain period of time, as determined by the Financial Services Commission.
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 Article 24 (Scope of Application of Limit of Credit Extension, etc.)   print
(1) The scope of subsidiaries, etc. under Article 45 (5) of the Act shall include the subsidiaries, etc. of a financial holding company, which are financial institutions which fall under any of the following subparagraphs: <Amended by Presidential Decree No. 20947, Jul. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
1. Banks;
2. Merchant banks;
3. Financial investment business entities;
4. Insurance companies;
5. Mutual savings banks under the Mutual Savings Banks Act (hereinafter referred to as "mutual savings bank");
6. Specialized credit financial companies under the Specialized Credit Financial Business Act (hereinafter referred to as "specialized credit financial company").
(2) The criteria for extending credit under Article 45 (5) of the Act shall be classified as follows: <Amended by Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22637, Jan. 24, 2011>
1. Where the subsidiary, etc. is a bank: Credit extension as defined in Article 2 (1) 7 of the Banking Act;
2. Where the subsidiary, etc. is a merchant bank: Credit extension as prescribed in Article 342 (1) of the Financial Investment Services and Capital Markets Act;
3. Where the subsidiary, etc. is a financial investment business entity: Lending assets having economic value, such as money and securities, guarantee of the discharge of obligation, or purchase of securities taking the character of funding, and other direct and indirect transactions determined and publicly notified by the Financial Services Commission which accompany credit risk in transactions;
4. Where the subsidiary, etc. is an insurance company: Credit extension as defined in subparagraph 13 of Article 2 of the Insurance Business Act;
5. Where the subsidiary, etc. is a mutual savings bank: Credit extension as defined in subparagraph 4-3 of Article 2 of the Mutual Savings Banks Act;
6. Where the subsidiary, etc. is a specialized credit financial company: Credit extension as defined in subparagraph 18 of Article 2 of the Specialized Credit Finance Business Act.
(3) The method of calculating equity capital under Article 45 (5) of the Act shall be classified as follows: <Amended by Presidential Decree No. 21998, Jan. 18, 2010; Presidential Decree No. 22637, Jan. 24, 2011>
1. Where the subsidiary, etc. is a bank: Equity capital as defined in Article 2 (1) 5 of the Banking Act;
2. Where the subsidiary, etc. is a merchant bank: Equity capital as prescribed in Article 342 (1) of the Financial Investment Services and Capital Markets Act;
3. Where the subsidiary, etc. is a financial investment business entity: Equity capital as prescribed in Article 37 (3) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act;
4. Where the subsidiary, etc. is an insurance company: Equity capital as defined in subparagraph 15 of Article 2 of the Insurance Business Act;
5. Where the subsidiary, etc. is a mutual savings bank: Equity capital as defined in subparagraph 4 of Article 2 of the Mutual Savings Banks Act;
6. Where the subsidiary, etc. is a specialized credit financial company: Equity capital as defined in subparagraph 19 of Article 2 of the Specialized Credit Finance Business Act;
7. In cases of a financial holding company: Equity capital as prescribed in Article 24-3 (7) 2.
(4) The net total amount of the equity capital of a financial holding company, etc. under Article 45 (5) of the Act shall be calculated by subtracting the following amounts from the total amount of equity capital of the financial holding company and subsidiaries, etc. referred to in each subparagraph of paragraph (1): <Amended by Presidential Decree No. 17716, Aug. 21, 2002>
1. Stocks of the subsidiaries, etc. held by the financial holding company;
2. Stocks held between the subsidiaries, etc. referred to in each subparagraph of paragraph (1) and stocks of the financial holding company held by the same subsidiaries, etc.
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 Article 24-2 (Limit of Credit Extension to Major Investors of Bank Holding Company, etc.)   print
(1) "Percentage prescribed by Presidential Decree" in the main sentence of Article 45-2 (1) of the Act means 25/100.
(2) "Percentage prescribed by Presidential Decree" in Article 45-2 (2) of the Act means 25/100.
(3) "Amount prescribed by Presidential Decree" in Article 45-2 (4) and (5) of the Act means five billion won or the amount equivalent to 10/10,000 of the net total amount of equity capital of a financial holding company, etc. as a single transaction amount, whichever is smaller. In such cases, the detailed criteria for the calculation of single transaction amount by types of credit extension shall be determined by the Financial Services Commission. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(4) "Transaction prescribed by Presidential Decree" in Article 45-2 (4) of the Act means a transaction to acquire debentures issued by means of public offering of new securities or public offering of outstanding securities under Article 9 (7) and (9) of the Financial Investment Services and Capital Markets Act. <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20947, Jul. 29, 2008>
(5) In accordance with Article 45-2 (6) of the Act, a banking holding company, etc. shall make public the size of credit extended to large stockholders as at the end of each quarter, increase and decrease in the amount of credit extended in the current quarter, conditions of transaction of credit extension, and other matters determined by the Financial Services Commission within one month after each quarter ends. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(6) The provisions of Article 24 shall apply mutatis mutandis to the scope of subsidiaries, etc., criteria for credit extension, calculation method of equity capital and net total amount of equity capital under Article 45-2 (1) through (5) of the Act.
(7) Specially related persons of major investors referred to in Article 45-2 (9) of the Act shall not include non-profit corporations, associations or organizations which fall under the public service corporation, etc. under Article 16 (1) of the Inheritance Tax and Gift Tax Act (hereinafter referred to as "public service corporation, etc."). <Newly Inserted by Presidential Decree No. 24659, Jul. 8, 2013>
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 24-3 (Limit on Acquisition of Stocks Issued by Major Investors, etc.)   print
(1) "Percentage prescribed by Presidential Decree" in Article 45-3 (1) of the Act means 1/100.
(2) Stocks acquired by a bank holding company, etc. by means of entrustment for which the operation method of money given in trust is designated by an entrusting person (including a person designated by an entrusting person; hereafter the same shall apply in this paragraph) shall not be deemed the stocks acquired under Article 45-3 (1) of the Act: Provided, That the foregoing shall not apply where an entrusting person is a bank holding company, etc.
(3) "Period prescribed by Presidential Decree" in Article 45-3 (2) of the Act means one year: Provided, That if deemed unavoidable in light of the amount of stocks held by a bank holding company, etc. in excess of the holding limit, securities exchange conditions, etc., the Financial Services Commission may extend such period, fixing another period. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(4) "Amount prescribed by Presidential Decree" in Article 45-3 (3) and (4) of the Act means five billion won or the amount equivalent to 10/10,000 of the net total amount of equity capital of a bank holding company, etc. as a single transaction amount (in cases of Article 45-3 (3) of the Act, excluding the amounts acquired on the securities exchange under the Financial Investment Services and Capital Markets Act or other exchanges equivalent thereto in foreign countries), whichever is smaller. <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20947, Jul. 29, 2008>
(5) In accordance with Article 45-3 (5) of the Act, a bank holding company, etc. shall make public the amount of stocks acquired, as issued by large stockholders as at the end of each quarter, increase or decrease in the amount of stocks in possession in the current quarter, acquired price of stocks in possession, and other matters determined by the Financial Services Commission within one month after each quarter ends. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(6) The net total amount of the equity capital of a bank holding company, etc. under Article 45-3 (1) of the Act and paragraph (4) of this Decree shall be calculated by subtracting from the total amount of equity capital of the relevant bank holding company, etc. the amounts which fall under each of the following subparagraphs: <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
1. Stocks of a subsidiary, etc., which are held by the bank holding company, etc.;
2. Stocks held between subsidiaries, etc. and stocks of the bank holding company, etc., which are held by subsidiaries, etc.
(7) The method of calculating equity capital under Article 45-3 (1) of the Act and paragraph (4) of this Decree shall be as classified in each of the following subparagraphs: <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
1. Where the subsidiary, etc. is a financial institution under any subparagraph of Article 24 (1): Equity capital under Article 24 (3) 1 through 6;
2. Where the subsidiary, etc. is a bank holding company and company other than those in each subparagraph of Article 24 (1): An amount obtained by deducting the total amount of debts from the total amount of assets in the balance sheet as of the end of the latest quarter (referring to the balance sheet as of the end of the latest business year, in the absence of the balance sheet as of the end of the latest quarter). In such cases, the increased or decreased portion of the capital since the end of the latest quarter (referring to the end of the latest business year, in the absence of the balance sheet as of the end of the latest quarter) shall be included in the calculation.
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 24-4 (Prohibition on Major Investors from Exercising Undue Influence)   print
"Conduct prescribed by Presidential Decree" in subparagraph 4 of Article 45-4 of the Act means either of the following:
1. Requesting for unfavorable contract conditions, such as interest rate or security, without justifiable grounds when extending credit to business competitors;
2. Requesting a bank holding company to transfer assets without consideration to a public service corporation, etc. referred to in Article 24-2 (7), or to trade or exchange assets or extend credit under manifestly unfavorable conditions to the relevant bank holding company, compared with the terms of normal transactions.
[This Article Wholly Amended by Presidential Decree No. 24659, Jul. 8, 2013]
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 Article 24-5 (Restrictions on Transactions with Major Investors, etc.)   print
(1) "Cases prescribed by Presidential Decree" in Article 45-5 (2) of the Act means cases where a major investor (limited to companies; hereafter the same shall apply in this Article) is deemed highly likely to make illegal transactions with the relevant bank holding company, etc., as falling under a ground in any of the following subparagraphs: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21765, Oct. 1, 2009; Presidential Decree No. 21998, Jan. 18, 2010>
1. Where debts exceed assets;
2. Where a financial institution (excluding a financial institution of which the relevant major investor is a large stockholder) which has provided the largest credit extension to the relevant major investor classifies the relevant major investor as falling below the criteria set by the Financial Services Commission, as a result of rating the credit risk of the relevant major investor according to Forward-Looking-Criteria (FLC) set by the Financial Services Commission;
3. Where two or more credit evaluation companies providing credit rating services under the Use and Protection of Credit Information Act have rated the large stockholder in an investment inadequate rating.
(2) "Measures prescribed by Presidential Decree, such as ordering a bank holding company, etc. to restrict extension of credit to a major investor" in Article 45-5 (2) of the Act means measures in each of the following subparagraphs: <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
1. Prohibition from offering new credit to major investors;
2. Restriction on transactions under Article 24-2 (4);
3. Prohibition from new acquisition of stocks issued by major investors.
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 25 Deleted. <by Presidential Decree No. 21998, Jan. 18, 2010>   print
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 Article 26 (Entrustment of Business between Subsidiaries, etc.)   print
(1) "Business prescribed by Presidential Decree" in the proviso to Article 47 (1) of the Act means each of the following: Provided That the business determined and publicly notified by the Financial Services Commission as unlikely to spread risk to other subsidiaries, etc., to cause conflicts of interest with customers, or to undermine sound trade order shall be excluded herefrom:
1. Business under the following items (only applicable to cases where the decision-making authority for the relevant business is also entrusted):
(a) Duties of compliance officers;
(b) Internal audit;
(c) Risk management;
(d) Analysis and assessment of credit risk;
2. Business prohibited from being entrusted under attached Table 6, from among principal business under Article 47 (4) of the Act.
(2) "Standards prescribed by Presidential Decree, such as the appropriateness of internal control guidelines" in the main sentence of Article 47 (2) of the Act means those falling under the following subparagraphs:
1. The internal control guidelines of a financial holding company under Article 41-5 (1) of the Act shall be established;
2. The operating standards for business entrustment of a financial holding company which contain the following items shall be established:
(a) Risk management and rating due to the entrustment of business;
(b) Procedures of determining and cancelling entrustment;
(c) Management and supervision of entrustees;
(d) Protection of customer information;
(e) Measures for contingencies, such as an entrustee's bankruptcy, etc.;
(f) Securing a means to request the submission of materials in respect of entrusted business;
(g) Other matters determined and publicly notified by the Financial Services Commission;
3. A contract for business entrustment containing the following matters shall be entered into between subsidiaries, etc. which entrust or is entrusted with business:
(a) The scope of business entrusted;
(b) Matters concerning the restricted activities of entrustees;
(c) Matters concerning record-keeping on the handling of business entrusted;
(d) Matters concerning the termination of a contract for business entrustment;
(e) Matters concerning the remuneration, etc. for entrustment;
(f) Other matters determined and publicly notified by the Financial Services Commission as necessary to prevent the spread of risk to other subsidiaries, etc., to prevent conflicts of interest with customers, or to maintain sound trade order;
4. The details of a contract for business entrustment under subparagraph 3 shall meet the following requirements:
(a) The details shall not undermine soundness in the management of financial institutions;
(b) The details shall not cause any conflicts of interest with customers;
(c) The details shall not undermine the stability of the financial market;
(d) The details shall not disrupt the order of financial transactions.
(3) Where the principal business under attached Table 6 which can be entrusted (excluding business the entrustment of which is permitted under other Acts and subordinate statutes and which does not require separate approval from the Financial Services Commission) is entrusted between its subsidiaries, etc., a financial holding company shall obtain approval from the Financial Services Commission.
(4) A financial holding company which intends to obtain approval under paragraph (3) shall submit to the Financial Services Commission an application for approval and accompanying documents determined and publicly notified by the Financial Services Commission.
(5) The Financial Services Commission shall, upon receipt of an application for approval under paragraph (4), decide whether to grant approval within 30 days from its receipt of the application for approval and give immediate written notice thereof to the relevant financial holding company after confirming as to whether such application satisfies the standards under paragraph (2): Provided, That no period determined and publicly notified by the Financial Services Commission, such as a period for rectifying any defect found in an application for approval, may be included in computing a handling period.
(6) Where any business which does not fall under paragraph (3) is entrusted between its subsidiaries, etc., a financial holding company shall prepare documents determined and publicly notified by the Financial Services Commission and report thereon to the Financial Services Commission no later than seven days prior to the date on which the subsidiaries, etc. actually intends to carry out the entrusted business.
(7) Notwithstanding paragraphs (3) and (6), a financial holding company may prepare the documents determined and publicly notified by the Financial Services Commission and report to the Financial Services Commission on the semiannual status on business entrustment within one month after the end of each half-year term, in cases determined and publicly notified by the Financial Services Commission, such as changes to the remuneration for entrustment, in respect of the details of business entrustment already approved or reported.
(8) "Others prescribed by Presidential Decree" in Article 47 (2) 4 of the Act means any of the following:
1. Termination of a contract for business entrustment;
2. Remuneration, etc. for entrustment;
3. Other matters determined and publicly notified by the Financial Services Commission, such as a system, etc. to prevent any conflicts of interest due to business entrustment.
(9) "Business prescribed by Presidential Decree" in Article 47 (4) of the Act means those specified as principal business in attached Table 6.
(10) "Requirements prescribed by Presidential Decree" in the latter part of Article 47 (4) of the Act means obtaining permission or authorization from, or filing registration, etc. with, a foreign supervisory agency in a country in which a foreign subsidiary, etc. is located and then operating a financial business, or a business equivalent to a business closely related to an operation of financial business, with which a subsidiary, etc., intends to be entrusted.
(11) In addition to those prescribed in paragraphs (1) through (10), detailed matters necessary for the methods and procedures, etc. for approval and reporting of the entrustment of business among the subsidiaries, etc. of a financial holding company shall be determined and publicly notified by the Financial Services Commission.
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 27 (Restrictions on Acts of Subsidiaries, etc.)   print
(1) "Cases prescribed by Presidential Decree" in the proviso to Article 48 (1) of the Act with the exception of each subparagraph means any of the following cases: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20367, Nov. 12, 2007>
1. Where the limit on credit is exceeded by the grounds in the following items:
(a) Where a financial holding company is newly established;
(b) Where a company which is not a subsidiary, etc. is newly included into a subsidiary, etc. of a financial holding company;
(c) Where the equity capital of a subsidiary, etc. has decreased;
(d) Where the limit of credit extension under Article 48 (1) 3 of the Act is exceeded by the grounds in subparagraphs 4, 6 and 7 of Article 22 (2);
2. Where the stocks of other subsidiary, etc. are held by the grounds in the following items:
(a) Where the stocks of the relevant company have been already held by a subsidiary, etc. at the time when a company which is not a subsidiary, etc. is included into a subsidiary, etc.;
(b) Where a company to be included into a subsidiary, etc. already holds the stocks of another company to be included into a subsidiary, etc. at the time when it became a financial holding company;
(c) Where a subsidiary, etc. holds the stocks of the other subsidiary, etc. through the execution of security rights;
(d) Cases of investing in a private equity fund.
(2) Where a subsidiary, etc. exceeds the limit on credit due to the grounds in paragraph (1) 1 and 2 (a) through (c), or has held the stocks of other subsidiary, etc., it shall collect the credit exceeding the limit or dispose of the stocks within two years from such date: Provided, That the Financial Services Commission may, in cases of extenuating causes prescribed and notified by the Financial Services Commission, extend such period. <Amended by Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21214, Dec. 31, 2008>
(3) In accordance with Article 48 (1) 2 (b) of the Act, any subsidiary, etc. may not hold the stocks of a foreign corporation controlled by another subsidiary, etc. of a financial holding company to which the relevant subsidiary, etc. belongs in excess of the limit under the following classifications: <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
1. The value of stocks of an individual foreign corporation controlled by another subsidiary, etc.: 10/100 of the equity capital of the relevant subsidiary, etc. (referring to the equity capital as classified in each subparagraph of Article 24-3 (7); hereafter the same shall apply in this paragraph);
2. The aggregate of the value of stocks of all foreign corporations controlled by another subsidiary, etc.: 20/100 of the equity capital of the relevant subsidiary, etc.
(4) No subsidiary, etc. which falls under any subparagraph of Article 24 (1) may offer credit (referring to credit extension as classified in each subparagraph of Article 24 (2) and investment in paragraph (1) 2 (d)) in excess of the limits as classified in each of the following subparagraphs to other subsidiaries, etc. of a financial holding company to which the relevant subsidiary belongs under Article 48 (1) 3 of the Act: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 21998, Jan. 18, 2010>
1. Credit provided to other subsidiaries, etc.: 10/100 of the equity capital (referring to the equity capital as classified in each subparagraph of Article 24 (3); hereafter the same shall apply in this paragraph) of the relevant subsidiary, etc.;
2. Total amount of credit offered to other subsidiaries, etc.: 20/100 of the equity capital of the relevant subsidiary, etc.
(5) Where subsidiaries, etc. which belong to the same financial holding company offer credit to other subsidiaries, etc. under Article 48 (2) of the Act, a collateral shall be secured at more than a ratio determined by the Financial Services Commission according to the kind of collateral, such as securities and real estate to the extent of not exceeding 150/100 of the amount of credit provided. <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
(6) "Subsidiary, etc. designated by Presidential Decree" in Article 48 (3) of the Act means any of the following financial institutions: <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
1. A mutual savings bank;
2. A securities finance company;
3. A merchant bank.
(7) "Dishonored assets prescribed by Presidential Decree" in Article 48 (3) of the Act means assets for a debtor, etc. who has or is deemed likely to have difficulty in the redemption of debts, when considering business management conditions, financial standing, cash flow for the future, etc., as determined by the Financial Services Commission. <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
(8) "Facilities prescribed by Presidential Decree" in Article 48 (4) of the Act means any of the following facilities: <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
1. The storage facilities of computer data;
2. An information and communications network under subparagraph 1 of Article 2 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, etc.;
3. Electronic equipment under subparagraph 8 of Article 2 of the Electronic Financial Transactions Act;
4. Facilities for answering calls from customers, etc.
(9) Pursuant to Article 48 (4) of the Act, a financial holding company, etc. shall comply with the criteria determined and publicly notified by the Financial Services Commission in respect of the following, when it places a joint advertisement or jointly use a computer system, office space, branches and facilities under any subparagraph of paragraph (8): <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
1. Protection of depositors or investors;
2. Prevention of conflicts of interest between financial holding companies, etc.;
3. Other matters necessary for the maintenance of sound order on the financial market, as determined by the Financial Services Commission.
(10) The scope of subsidiaries, etc. under Article 48 (8) of the Act means the subsidiaries, etc. of the relevant financial holding company. <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
(11) The credit under Article 48 (1) 1 and 3 and (2) of the Act shall be offered by means of loan, guarantee of payment, purchase of securities (limited to financial support-natured purchase of securities) and other direct and indirect transactions accompanied with credit risk in financial transactions, as determined and announced by the Financial Services Commission. <Amended by Presidential Decree No. 20367, Nov. 12, 2007; Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
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 Article 27-2 (Policies on Handling of Customer Information)   print
(1) Policies on handling customer information to be established by a financial holding company, etc. under Article 48-2 (6) of the Act (hereafter referred to as "information-handling policies" in this Article) shall contain each of the following: <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
1. The kinds of customer information provided;
2. Places of provision of customer information;
3. Internal policies for the protection of customer information.
(2) A financial holding company, etc. shall, when information-handling policies are first determined or revised, give immediate notice thereof to existing transacting parties, or publish such fact in daily newspapers and put them on the bulletin board at its business offices, such as the main office and branch office and make it known to the public via the Internet.
(3) A financial holding company, etc. shall, when it has commenced financial transactions, deliver and explain (in cases of commencing transactions via the internet, a notice) its information-handling policies to the other party and give notice thereof or publish such in daily newspapers once each year.
(4) Notice of information-handling policies under paragraphs (2) and (3) may be given by mail, electronic mail, etc.
(5) The Financial Services Commission may determine detailed matters to be included in information-handling policies under paragraph (1). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
(6) Subsidiaries, etc. subject to Article 48-2 (1) through (6) of the Act under paragraph (7) of the same Article shall be limited to subsidiaries, etc. which belong to financial holding companies which are financial institutions or companies closely related to the operation of financial business under Article 2 (2). <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 28 (Management Guidance Standards)   print
The management guidance standards to be established by the Financial Services Commission under Article 50 (2) of the Act shall include the following: <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
1. Appropriateness of the capital of financial holding companies, etc.;
2. Soundness of the capital of financial holding companies, etc.;
3. Business management conditions, such as the business management aptitude, etc. of officers of a financial holding company, etc.;
4. Other matters deemed necessary for the security of sound management, such as whether a financial holding company, etc. observes Acts and subordinate statutes.
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 Article 29 Deleted. <by Presidential Decree No. 21998, Jan. 18, 2010>   print
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 Article 30 (Business Reports)   print
"Matters prescribed by Presidential Decree" in Article 54 (1) of the Act means the following: <Amended by Presidential Decree No. 17716, Aug. 21, 2002>
1. General conditions of financial holding companies, etc., such as the history and organization of the financial holding company, etc.;
2. Details of the business conducted by subsidiaries, etc.;
3. Present conditions of officers of financial holding companies, etc.;
4. Brief personal record of outside directors and compliance officers of financial holding companies, etc.;
5. Largest stockholder (including his/her specially related persons) and major stockholders of financial holding companies, etc.;
6. Transactions made between financial holding companies, etc.;
7. Stores and management of human resources of financial holding companies, etc.;
8. Where a financial holding company, etc., or any officer or employee thereof has been subject to any measure taken by the Financial Services Commission or the Governor of the Financial Supervisory Service for the latest five years, such fact;
9. Other matters concerning the operation or management of financial holding companies, etc., as determined by the Financial Services Commission, being recognized as necessary to be made known to the general public.
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 Article 31 (Publication of Management)   print
(1) A financial holding company shall publish matters in each of the following subparagraphs under Article 56 of the Act: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008>
1. Finances, and profits and losses of the financial holding company, etc.;
2. Procurement and management of funds of the financial holding company, etc.;
3. Where the financial holding company has been subject to any measure taken in accordance with Article 57 of the Act, or Articles 10 and 14 of the Act on the Structural Improvement of the Financial Industry, such fact;
4. Other matters determined by the Financial Services Commission, being recognized as necessary for the protection of the rights and interests of depositors and investors.
(2) The Financial Services Commission may determine detailed criteria for the matters for publication in subparagraphs 1 through 3 of paragraph (1). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
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 Article 31-2 (Scope of Finance-Related Acts, Subordinate Statutes, etc.)   print
"Finance-related Acts and subordinate statutes prescribed by Presidential Decree" in the latter part of Article 57 (1) of the Act means Acts under the subparagraphs of Article 17 (1).
[This Article Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 31-3 (Sanctions for Private Equity Funds, etc.)   print
(1) "Measures prescribed by Presidential Decree" in Article 57-3 (3) 5 of the Act means either of the following:
1. Demand or recommendation to improve methods of business affairs;
2. Other measures taken by the Financial Services Commission under the Act, this Decree or other relevant Acts and subordinate statutes.
(2) "Measures prescribed by Presidential Decree" in Article 57-3 (4) 1 (e) of the Act means any measure falling under any of the subparagraphs of paragraph (1).
(3) "Measures prescribed by Presidential Decree" in Article 57-3 (4) 2 (e) of the Act means those falling under either of the following subparagraphs:
1. Caution;
2. Other measures taken by the Financial Services Commission under the Act, this Decree, and other Acts and subordinate statutes.
(4) "Measures prescribed by Presidential Decree" in Article 57-3 (4) 3 (f) of the Act means those falling under either of the following subparagraphs:
1. Warning;
2. Other measures taken by the Financial Services Commission under the Act, this Decree or other relevant Acts and subordinate statues.
[This Article Newly Inserted by Presidential Decree No. 21776, Oct. 9, 2009]
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 Article 32 (Authorization for Dissolutions and Mergers)   print
(1) When a financial holding company intends to obtain authorization for its dissolution under Article 60 (1) of the Act, it shall submit to the Financial Services Commission an application in which the grounds for and timing of dissolution are stated, attached with the following documents: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Minutes of the general meeting of stockholders in which a resolution is made on dissolution;
2. Register of stockholders and officers at the time of dissolution;
3. Schedule for dissolution and liquidation procedures;
4. Financial statements of the latest business year;
5. Plan of disposal of assets and liabilities.
(2) When a financial holding company intends to obtain authorization for merger under Article 60 (1) of the Act, it shall submit to the Financial Services Commission an application in which the grounds for and timing of merger are stated, attached with the following documents: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. Merger contract;
2. Articles of incorporation of a company to continue to exist after merger or a company to be newly established through merger;
3. Balance sheet and list of assets of each company subject to merger.
(3) When the Financial Services Commission intends to grant authorization for dissolution or merger under Article 60 (1) of the Act, it shall examine whether the requirements in each of the following subparagraphs are satisfied: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008>
1. The dissolution or merger must not restrict competition in the relevant markets nor undermine the sound order of the financial market;
2. The financial holding company to continue to exist or to be newly established after merger must satisfy the management guidance standards set by the Financial Services Commission under Article 50 of the Act;
3. The dissolution or merger must not unreasonably disadvantage customers;
4. The procedure and details of the dissolution or merger must not have any defect in light of the Act, the Commercial Act, the Monopoly Regulation and Fair Trade Act, and finance-related Acts and subordinate statutes.
(4) The Financial Services Commission may determine application documents for dissolution or merger and detailed criteria for the examination of requirements as referred to in paragraphs (1) through (3). <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
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 Article 33 (Matters to be Reported)   print
"Cases prescribed by Presidential Decree" in subparagraph 6 of Article 61 of the Act means each of the following cases: <Amended by Presidential Decree No. 20367, Nov. 12, 2007>
1. Cases of receiving a punishment under Articles 70 and 71 of the Act;
2. Cases of becoming a relevant party to a lawsuit to exert substantial influence on the business of a financial holding company;
3. Cases where a petition of bankruptcy is filed with respect to a financial holding company under the Debtor Rehabilitation and Bankruptcy Act;
4. Cases where an application for the commencement of rehabilitation procedures is filed in relation to a financial holding company under the Debtor Rehabilitation and Bankruptcy Act, cases where a court declaration on authorization of rehabilitation plan is confirmed and cases where such rehabilitation plan has become invalid;
5. Cases of being subject to a disposition of default of taxes and the case of receiving a punishment in violation of tax-related Acts and subordinate statutes;
6. Cases where the requirements to be a financial holding company are not satisfied.
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 Article 33-2 (Calculation Method of Stock Purchase Prices, etc.)   print
(1) "Amount calculated by a method prescribed by Presidential Decree" in Article 62-2 (3) 1 of the Act means an amount calculated according to the methods classified in each subparagraph of Article 176-7 (2) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act. <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 21291, Feb. 3, 2009>
(2) A company under Article 62-2 (3) 2 of the Act shall, when it fails to reach agreement with a stockholder on the purchase price of stocks, without delay appoint an accounting firm under the Certified Public Accountant Act, which does not fall under any of the following subparagraphs, as an accounting expert to calculate the purchase price of the stocks: <Amended by Presidential Decree No. 18834, May 26, 2005; Presidential Decree No. 20653, Feb. 29, 2008>
1. An accounting firm which is subject to a disposition of suspension of business from the Financial Services Commission under the Certified Public Accountant Act and for which the period of suspension of business has not passed;
2. An accounting firm upon which are imposed restrictions on carrying out auditing business for specific companies by the Securities and Futures Commission under the Act on External Audit of Stock Companies and for which the period of imposition of restrictions has not passed;
3. Specially related persons to the relevant company;
4. An accounting firm which has carried out auditing business with respect to the relevant company for the latest two years, and an accounting firm which is carrying out auditing business with respect to the relevant company for the current business year.
[This Article Newly Inserted by Presidential Decree No. 17716, Aug. 21, 2002]
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 Article 33-3 (Entrustment of Authority)   print
(1) The Financial Services Commission shall entrust the Governor of the Financial Supervisory Service with its authority under the subparagraphs of attached Table 7, pursuant to Article 63 of the Act.
(2) The Governor of the Financial Supervisory Service shall report to the Financial Services Commission on the details of business entrusted under paragraph (1) every six months: Provided, That the Financial Services Commission may separately set the timing of reporting for business determined and publicly notified by the Financial Services Commission.
[This Article Wholly Amended by Presidential Decree No. 21998, Jan. 18, 2010]
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 Article 33-4 (Management of Sensitive Information and Personally Identifiable Information)   print
If unavoidable to carry out the following business affairs, the Financial Services Commission (including any person entrusted with the authority of the Financial Services Commission under Article 33-3) and the Governor of the Financial Supervisory Service shall handle materials containing the information equivalent to criminal history records referred to in subparagraph 2 of Article 18 of the Enforcement Decree of the Personal Information Protection Act, and the resident registration numbers, passport numbers or alien registration numbers referred to in subparagraph 1, 2 or 4 of Article 19 of the same Decree:
1. Business affairs concerning authorization under Article 3 of the Act;
2. Business affairs concerning approval under the proviso to Article 5-2 (2) of the Act;
3. Business affairs concerning reporting, etc. on any change of capital and any modification to its articles of incorporation under Article 6-2 of the Act;
4. Business affairs concerning approval under the proviso to Article 7 (2) of the Act;
5. Business affairs concerning approval for change, etc. of large stockholders under Article 7-2 of the Act;
6. Business affairs concerning restrictions, etc. on ownership of stocks of bank holding companies under Article 8 of the Act;
7. Business affairs concerning approval, etc. under Articles 8-2, 8-4, and 8-5 of the Act;
8. Business affairs concerning appraisal, etc. of a conversion plan under Article 8-3 of the Act;
9. Business affairs concerning reporting by a private equity fund, etc. under Article 8-6 of the Act;
10. Business affairs concerning examination as to whether a foreign bank, etc. meets the standards under Article 9 of the Act;
11. Business affairs concerning restrictions, etc. on voting rights of stocks held in excess of limit under Article 10 of the Act;
12. Business affairs concerning examination on eligibility, etc. of stockholders who hold stocks in excess of holding limit, etc. under Article 10-2 of the Act;
13. Business affairs concerning approval for and reporting on the inclusion of company into subsidiary, etc. under Articles 16 and 18 of the Act;
14. Business affairs concerning reporting, etc. under Article 21 of the Act;
15. Business affairs concerning approval, authorization, etc. under Articles 22 through 24, 29, and 30 of the Act;
16. Business affairs concerning restrictions, etc. on trading, etc. with large stockholders under Article 34 of the Act;
17. Business affairs concerning inspections, etc. on non-financial companies under Article 37 of the Act;
18. Business affairs concerning restrictions, etc. on concurrent holding of office by executives or employees under Article 39 of the Act;
19. Business affairs concerning reporting under Article 41-5 of the Act;
20. Business affairs concerning examination, etc. of financial holding company's obligation to own stocks of subsidiaries under Article 43-2 of the Act;
21. Business affairs concerning examination, etc. of financial holding company's obligation to own stocks of second-tier subsidiaries under Article 43-3 of the Act;
22. Affairs concerning limits on credit extension, etc. under Articles 45 and 45-2 of the Act;
23. Business affairs concerning limits, etc. on acquisition of stocks issued by major investors under Article 45-3 of the Act;
24. Business affairs concerning demands to submit data, etc. to major investors under Article 45-5 of the Act;
25. Business affairs concerning entrustment of affairs among subsidiaries, etc. under Article 47 of the Act;
26. Business affairs concerning reporting, etc. under Article 48-2 (5) of the Act;
27. Business affairs concerning supervision of financial holding companies, etc. and follow-up measures, etc. under Article 49 of the Act;
28. Business affairs concerning inspections of financial holding companies, etc. and follow-up measures, etc. under Article 51 of the Act;
29. Business affairs concerning inspections of major investors, etc. and follow-up measures, etc. under Article 51-2 of the Act;
30. Business affairs concerning submission of business reports, etc. under Article 54 of the Act;
31. Business affairs concerning approval under the proviso to Article 55 of the Act;
32. Business affairs concerning submission, etc. of documents in electronic form under Article 55-2 of the Act;
33. Business affairs concerning management disclosure under Article 56 of the Act;
34. Business affairs concerning administrative dispositions under Article 57 of the Act;
35. Business affairs concerning notification under Article 57-2 of the Act;
36. Business affairs concerning sanctions, etc. against private equity funds, etc. under Article 57-3 of the Act;
37. Business affairs concerning corrective measures, etc. under Article 58 of the Act;
38. Business affairs concerning hearings under Article 59 of the Act;
39. Business affairs concerning authorization under Article 60 of the Act;
40. Business affairs concerning reporting under Article 61 of the Act;
41. Business affairs concerning imposition and collection of penalty surcharges under Articles 64 and 69 of the Act;
42. Business affairs concerning imposition, etc. of charges to compel execution under Article 69-2 of the Act.
[This Article Newly Inserted by Presidential Decree No. 23488, Jan. 6, 2012]
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 Article 34 (Criteria for Imposition of Penalty Surcharges, etc.)   print
(1) "Balance sheet prescribed by Presidential Decree" in subparagraph 1 of Article 64 of the Act means the balance sheet of a financial holding company as of the end of the latest business year. <Newly Inserted by Presidential Decree No. 21998, Jan. 18, 2010>
(2) A penalty surcharge under Article 64 of the Act shall be imposed less than the amount calculated by applying the imposition rate of penalty surcharge which the Financial Services Commission determines for each category of the basic amounts of penalty surcharge as determined in each subparagraph of the same Article, classifying them into the following five categories: not more than one billion won, between more than one billion won and not more than ten billion won, between more than ten billion won and not more than 100 billion won, between more than 100 billion won and not more than one trillion won, and more than one trillion won. <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
(3) The amount calculated under paragraph (2) may be reduced in light of matters referred to in each subparagraph of Article 65 (1) of the Act. <Amended by Presidential Decree No. 21998, Jan. 18, 2010>
(4) When the Financial Services Commission intends to impose a penalty surcharge under Article 65 of the Act, it shall give written notice of the payment, indicating therein the kind of the relevant offence and the amount of the penalty surcharge. <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
(5) Any person in receipt of notice under paragraph (4) shall pay the penalty surcharge to the collecting agency designated by the Financial Services Commission within 60 days from the date on which the notice is issued. <Amended by Presidential Decree No. 20653, Feb. 29, 2008; Presidential Decree No. 21998, Jan. 18, 2010>
(6) Matters necessary for the imposition of penalty surcharges other than those provided for in this Decree, shall be determined by the Financial Services Commission. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
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 Article 35 (Extension of Payment Deadline and Installment Payments of Penalty Surcharges)   print
(1) The extension of deadline for payment under Article 68 (1) of the Act shall not exceed one year from the date following such time limit.
(2) Where installment payments are permitted under Article 68 (1) of the Act, the interval between the time limits for each installment payment shall be within six months and the number of installment payments shall not exceed three times.
(3) Matters necessary for the extension of payment deadline or application for installment payments, etc. under Article 68 (2) of the Act shall be determined by the Financial Services Commission. <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
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 Article 36 (Additional Dues)   print
"Additional due prescribed by Presidential Decree" in Article 69 (1) of the Act means an amount calculated by applying 6/100 to the amount of penalty surcharges in arrears on a yearly basis.
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 Article 37 (Demand Notices)   print
(1) Demand notices under Article 69 (2) of the Act shall be issued in writing within 15 days from the lapse of the payment deadline.
(2) Where a demand note is issued under paragraph (1), the payment deadline of penalty surcharges in arrears shall be within ten days from the date of issue of demand notice.
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 Article 38 (Entrustment of Affairs of Disposition on Default)   print
(1) Where the Financial Services Commission entrusts affairs concerning disposition on default to the Commissioner of the National Tax Service under Article 69 (3) of the Act, it shall do so in writing, attaching documents in each of the following subparagraphs thereto: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. A written resolution made by the Financial Services Commission;
2. A written resolution made to collect revenues and notices;
3. A demand notice for payment.
(2) The Commissioner of the National Tax Service shall, when entrusted with the affairs of disposition on default under paragraph (1), notify the Financial Services Commission of matters which fall under either of the following in writing within 30 days from the occurrence of such cause: <Amended by Presidential Decree No. 20653, Feb. 29, 2008>
1. In cases where the affairs concerning disposition on default has been completed, the timing of completion of such affairs and other necessary matters;
2. In cases of any request from the Financial Services Commission for a report on the status of progress, such status of progress.
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 Article 39 Deleted. <by Presidential Decree No. 21155, Dec. 3, 2008>   print
ADDENDUM
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 17291, Jul. 7, 2001>
(1) (Enforcement Date) This Decree shall enter into force on the date of its promulgation.
(2) through (5) Omitted.
ADDENDUM <Presidential Decree No. 17716, Aug. 21, 2002>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 17791, Dec. 5, 2002>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 and 3 Omitted.
ADDENDA <Presidential Decree No. 18297, Feb. 28, 2004>
Article 1 (Enforcement Date)
This Decree shall enter into force on March 1, 2004.
Articles 2 through 5 Omitted.
ADDENDUM <Presidential Decree No. 18312, Mar. 17, 2004>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 18596, Dec. 3, 2004>
Article 1 (Enforcement Date)
This Decree shall enter into force on December 6, 2004
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 18736, Mar. 8, 2005>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDUM <Presidential Decree No. 18834, May 26, 2005>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 19422, Mar. 29, 2006>
Article 1 (Enforcement Date)
This Decree shall enter into force on April 1, 2006.
Article 2 Omitted.
ADDENDA <Presidential Decree No. 20331, Oct. 23, 2007>
Article 1 (Enforcement Date)
This Decree shall enter into force on October 28, 2007. (Proviso Omitted.)
Articles 2 through 3 Omitted.
ADDENDUM <Presidential Decree No. 20367, Nov. 12, 2007>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 20653, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation: Provided, That the amended part of a Presidential Decree, which was promulgated before the enforcement date of this Decree but the enforcement date of which has not come yet, from among Presidential Decrees amended by Article 2 of this Addenda, shall enter into force on the enforcement date of the relevant Presidential Decree, respectively.
Article 2 Omitted.
ADDENDA <Presidential Decree No. 20947, Jul. 29, 2008>
Article 1 (Enforcement Date)
This Decree shall enter into force on February 4, 2009. (Proviso Omitted.)
Articles 2 through 28 Omitted.
ADDENDUM <Presidential Decree No. 21155, Dec. 3, 2008>
This Decree shall enter into force on the date of its promulgation.
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. 21291, Feb. 3, 2009>
Article 1 (Enforcement Date)
This Decree shall enter into force on February 4, 2009.
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 21518, May 29, 2009>
Article 1 (Enforcement Date)
This Decree shall enter into force on June 1, 2009.
Articles 2 and 3 Omitted.
ADDENDA <Presidential Decree No. 21765, Oct. 1, 2009>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 21776, Oct. 9, 2009>
Article 1 (Enforcement Date)
This Decree shall enter into force on October 10, 2009.
Article 2 (Applicability)
The amended provisions of Article 6-2 (3) and (4) shall apply to an incident falling under a ground for reporting occurs on or after the date this Decree enters into force.
ADDENDA <Presidential Decree No. 21998, Jan. 18, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation: Provided, That the amended provisions of Articles 11, 18, 19-4, 19-5, 20-2, 21, 25, 26, 27 and 27-2 shall enter into force on February 1, 2010.
Article 2 (Applicability concerning Exclusion of Affiliated Companies)
The amended provisions of Article 2 (3) 5 shall apply to a company of which an investment trader acquires stocks by transfer on or after the date this Decree enters into force.
Article 3 (Applicability concerning Reporting on Acquisition of Subsidiaries, etc)
The amended provisions of Article 14 (1) 4 shall apply beginning with the first case where a creditor financial institution which is a subsidiary, etc. of a financial holding company controls any other company through investment conversion, etc. of claims pursuant to Article 29 (1) of the Corporate Restructuring Promotion Act on or after December 1, 2009.
Article 4 (Applicability concerning Requirements, etc. for Authorization of Non-Bank Holding Companies)
The amended provisions of Articles 16-3 and 16-4 shall apply to an application for authorization or approval filed on or after the date this Decree enters into force.
Article 5 (Applicability concerning Qualifications of Outside Directors)
The amended provisions of Article 19 shall apply beginning with the first outside director appointed after this Decree enters into force.
Article 6 (Transitional Measures concerning Limit, etc. of Credit Extension)
A financial holding company, etc. which exceeds the limit of credit extension provided for in Articles 45 (1) through (3), 45-2 (1) and (2), and 48 (1) 3 of the Act, pursuant to the amended provisions of Article 24 (1), shall comply with the limit of credit extension within one year from the enforcement date of this Decree: Provided, That the Financial Services Commission may fix and extend the period for up to one year in cases of extenuating grounds, such as a no-prepayment clause in a contract (limited to a contract for credit extension entered into before the enforcement date of this Decree).
ADDENDA <Presidential Decree No. 22151, May 4, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on May 5, 2010.
Articles 2 through 4 Omitted.
ADDENDUM <Presidential Decree No. 22467, Nov. 2, 2010>
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 Nov. 18, 2010.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 22509, Dec. 2, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Applicability to Reporting on Stock-Holding Status, etc.)
The amended provision of Article 6-2 (3) shall apply to a case which becomes subject to reporting on or after the date this Decree enters into force.
Article 3 (Applicability to Reporting on Inclusion of Subsidiaries, etc.)
The amended provisions of the proviso to Article 14 (1), and subparagraph 5 of the same paragraph shall apply to a case in which any subsidiary, etc. is included into a financial holding company on or after the date this Decree enters into force.
Article 4 (Applicability to Disqualification of Outside Directors)
The amended provisions of Article 19 (3) 3, (4) 6 and 8 shall apply to an outside director appointed on or after the date this Decree enters into force.
ADDENDA <Presidential Decree No. 22577, Dec. 30, 2010>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2011. (Proviso Omitted.)
Articles 2 through 21 Omitted.
ADDENDA <Presidential Decree No. 22637, Jan. 24, 2011>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 24, 2011. (Proviso Omitted.)
Articles 2 through 23 Omitted.
ADDENDA <Presidential Decree No. 23488, Jan. 6, 2012>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Article 2 Omitted.
ADDENDA <Presidential Decree No. 23644, Feb. 29, 2012>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation: Provided, That...(Omitted.)...the amended provisions of Articles 2 and 3 of Addenda shall enter into force on July 22, 2012.
Articles 2 through 4 Omitted.
ADDENDUM <Presidential Decree No. 24659, Jul. 8, 2013>
This Decree shall enter into force on the date of its promulgation.