Article 1(Purpose) #
The purpose of this Act is to set up the National Investment Fund and prescribe the matters necessary for its efficient employment, in order to raise and supply the investment and loanable funds, based on the extensive savings and participation of the people, which are necessary in promoting the foundation of key industries, such as heavy and chemical industries, and increasing the exports.
Article 2(Definitions) #
The definitions of terms used in this Act shall be as follows: <Amended by Act No. 5403, Aug. 30, 1997; Act No. 5505, Jan. 13, 1998>
1. The term “key industries” means steel, non-ferrous metals, shipbuilding, machine, chemical, electronics and foodstuff production increase industries, and other industries determined by the Presidential Decree; and
2. The term “financial institutions” means the financial institutions under the Banking Act, Korea Development Bank, Industrial Bank of Korea, and ExportImport Bank of Korea.
Article 3(Establishment of National Investment Fund) #
The Government shall establish the National Investment Fund in order to secure the investment and loanable funds for the key industries and supply them smoothly.
Article 4(Financial Sources of National Investment Fund) #
The National Investment Fund shall be created with the financial resources under the following subparagraphs:
1. Funds raised by issuing national investment bonds and from the deposits referred to in Article 8 (1);
2. Transfers and deposits from various government accounting units; and
3. Surplus funds at the annual fiscal closing of the National Investment Fund.
Article 5(Withdrawals from and Deposits to National Investment Fund) #
The Government may make withdrawals from and deposits to the National Investment Fund as prescribed by the annual budget.
Article 6(Issuance of National Investment Bonds) #
(1) The Government may issue national investment bonds under the liability of the National Investment Fund.
(2) The Government shall get the resolution of the National Assembly, where it intends to issue any national investment bonds.
(3) The Government shall submit any necessary materials to the National Assembly, where it intends to get the resolution of the National Assembly pursuant to paragraph (2).
Article 7(Methods of Issuing National Investment Bonds) #
The Government shall issue the national investment bonds either at par or at a discount: Provided, That the bonds may be issued above par value or below, depending on the financial market conditions.
Article 8(Acquisition, etc. of National Investment Bonds) #
(1) Those who have claims to or savings at the following funds shall acquire national investment bonds or make deposits to the National Investment Fund, notwithstanding the provisions of other Acts: Provided, That this shall not apply in the cases determined by the Presidential Decree:<Amended by Act No. 3902, Dec. 31, 1986; Act No. 3930, May 30, 1987>
1. Members’ savings at the National Savings Union (hereinafter referred to as “National Savings Union”) under the Act on the Assistance to Residential Stability and Lump Sum-Raising Savings of Workers;
2. Funds created by the National Pension Act;
3. Funds created with postal savings and national life insurance;
4. Funds determined by the Presidential Decree among those which are managed, supported or contributed by the Government, local governments and other public organizations;
5. Funds created with financial institutions’ savings deposits;
6. Funds created with trust companies’ non-specified money trust; and
7. Funds created with insurance companies’ premium revenues.
(2) The method, scale and procedure of acquiring national investment bonds or depositing funds to the National Investment Fund under paragraph (1) shall be determined by the Presidential Decree: Provided, That when the national investment bonds are acquired, or funds are deposited to the National Investment Fund, using the funds created by savings deposits at financial institutions, the acquired amount of the national investment bonds and net increased amount of deposits (the sum of the acquired amount of national investment bonds and deposits less repayment) of a financial institution each year shall not exceed 20/100 of the total increased amount of savings deposits at the financial institution.
(3) The Minister of Finance and Economy may temporarily postpone the acquiring of national investment referred to in paragraph (1) or repurchase the acquired national investment bonds when such is necessary depending on the financial market conditions and supply-demand status of funds. <Amended by Act No. 4980, Dec. 6, 1995>
Article 9(Payment for Purchase of Land with National Investment Bonds) #
(1) The Government, local governments, and other public organizations may pay the whole or part of amount of purchase by transferring the ownership of national investment bonds, when they buy forests or idle lands pursuant to the Presidential Decree for the construction of industrial complex, road or bases for the key industries.
(2) For land purchases through means of transferring the ownership of national investment bonds under paragraph (1), method of delivery, demand-supply of and account settlement for funds between the National Investment Fund and main parties concerned in the project, and other necessary matters shall be determined by the Presidential Decree.
Article 10(Stock Conversion of National Investment Bonds) #
(1) Holders of national investment bonds may pay the purchase price of the stocks designated by the Minister of Finance and Economy with the national investment bonds, in cases where they purchase stocks (including investment certificates; the same shall apply hereinafter) from the Government. <Amended by Act No. 4980, Dec. 6, 1995>
(2) Holders of national investment bonds may pay the purchase price of the stocks or debentures designated by the Minister of Finance and Economy, in cases where they acquire the stocks or debentures floated by juristic persons operating in the key industries. <Amended by Act No. 4980, Dec. 6, 1995>
(3) In the cases under paragraph (2), the corporations that received a payment in national investment bonds may replay loans from financial institutions with the said national investment bonds or request redemption of the said national investment bonds from the National Investment Fund at any time: Provided, That when the juristic person have drawn loans from the National Investment Fund, they shall repay the loans with the national investment bonds.
(4) In case where financial institutions, received repayment of loans in national investment bonds under the provisions of paragraph (3), they may repay the loans from the National Investment Fund with the said national investment bonds or request redemption of the said national investment bonds from the National Investment Fund at any time.
(5) The National Investment Fund shall redeem the bonds when it receives a request for redemption of national investment bonds under the provisions of paragraphs (3) and (4).
(6) The method, scale and procedure of the designation, payment, or repayment referred to in paragraphs (1) through (5) shall be determined by the Presidential Decree.
Article 11(Exchange Ratio of National Investment Bonds to Stocks or Debentures and Price Assessment of National Investment Bonds) #
For the holders of national investment bonds who intend to pay the purchase price or acquiring price of stocks or debentures with national investment bonds under the provisions of Article 10, the exchange ratio of the national investment bonds to the stocks or debentures, method of assessing the price of national investment bonds, and other necessary matters shall be determined by the Presidential Decree.
Article 12(Priority of Holders of National Investment Bonds) #
(1) In a sale of stocks by the Government or floating of stocks or debentures by corporations operating in the key industries, in the cases where the members of the National Savings Union pay the purchase price with the national investment bonds that they had acquired (limited to those who acquired under the provisions of Article 8 (1) 1), or where those determined by the Presidential Decree pay the purchase price with the national investment bonds that they had accepted, those bond acquirers shall be given priority in the purchase allotment or acquisition allotment within the limits determined by the Presidential Decree.
(2) If the juristic person that has drawn loans from the National Investment Fund issue stocks or debentures above the par value, the allotment that the national investment bond acquirers acquire with priority under the provisions of paragraph (1) shall be issued at an acquiring price set at a discount or determined by other favorable methods as prescribed by the Presidential Decree.
Article 13(Equivalence to Cash Payment for Stocks and Debentures) #
When stocks or debentures are purchased by transferring the ownership of national investment bonds in accordance with Articles 10 through 12, they shall be regarded equivalent to cash payment in the application of the Commercial Act and other Acts.
Article 14(Interest Rate, Maturity, and Redemption Terms of National Investment Bonds) #
(1) Interest rates, maturities, redemption terms and other necessary matters shall be determined and announced by the Minister of Finance and Economy. <Amended by Act No. 4980, Dec. 6, 1995>
(2) Interest rates of national investment bonds shall be set equal to or above the interest rate of one-year time deposit available at the start of every interest period for each interest payment period, and interest rates may not be changed within one year from the date of the bond issuance.
(3) National investment bonds may be issued with fixed interest rates until maturity. In this case, interest rates shall be equal to or above the interest rate of one-year time deposit available at the time of issuance.
Article 15(Application of State Bond Act) #
Those which are not prescribed by this Act shall follow the regulations of the State Bond Act.
Article 16(Employment and Management of National Investment Fund) #
(1) The National Investment Fund shall be employed and managed by the Minister of Finance and Economy. <Amended by Act No. 4980, Dec. 6, 1995>
(2) The Minister of Finance and Economy may delegate the responsibilities related to the issuance and redemption of national investment bonds and the employment and management of the National Investment Fund to the Governor of the Bank of Korea. <Amended by Act No. 4980, Dec. 6, 1995>
(3) Accounting of the National Investment Fund shall follow the generally accepted corporate accounting principles.
(4) The National Investment Fund shall be employed through financial institutions for financing under the following subparagraphs: Provided, That the funds for financing under subparagraph 4 may be employed without the intermediation of financial institutions: <Amended by Act No. 5454, Dec. 13, 1997>
1. Facilities financing for the key industries (including the financing of the land purchase and site construction for the key industries.);
2. Working capital for the key industries;
3. Financing for execution of the tasks referred to in Article 18 (1) 1, 3 and 4 of the Export-Import Bank of Korea Act;
4. Financing for land purchases referred to in Article 9; and
5. Financing for other purposes as determined by the Presidential Decree.
Article 17 #
Deleted.<by Act No. 4980, Dec. 6, 1995>
Article 18(Employment Period of National Investment Fund) #
The Minister of Finance and Economy shall develop the employment requirements and principles of the National Investment Fund that specify terms and principles of the employment of the National Investment Fund, including what shall be observed by financial institutions in employing the National Investment Fund, and then get the approval from the President subject to the review by the State Council. <Amended by Act No. 4980, Dec. 6, 1995>
Article 19(Annual Planning for Sources and Uses of National Investment Fund) #
The Minister of Finance and Economy shall develop for every fiscal year a plan for sources and uses of the National Investment Fund, and get the approval from the President subject to the review by the State Council. <Amended by Act No. 4980, Dec. 6, 1995>
Article 20(Accounting Organs of National Investment Fund) #
(1) The Minister of Finance and Economy shall appoint, from among the public officials related with him, the National Investment Fund Account Officers in Command and the National Investment Fund Accounting Officials. <Amended by Act No. 4980, Dec. 6, 1995>
(2) Where the responsibilities related to the issuance and redemption of national investment bonds and employment and management of the National Investment Fund are delegated to the Governor of the Bank of Korea in accordance with the provisions of Article 16 (2), the Minister of Finance and Economy may appoint one of the assistant vice governors of the Bank of Korea as the Assistant Vice Governor in charge of the National Investment Fund Account and employees of the Bank of Korea as the National Investment Fund Accounting Officers. In this case, the Assistant Vice Governor in charge of the National Investment Fund Account shall carry out the responsibilities of the National Investment Fund Account Officer in Command, and the National Investment Fund Accounting Officers shall carry out the responsibilities of the National Investment Fund Accounting Officials. <Amended by Act No. 4980, Dec. 6, 1995; Act No. 5505, Jan. 13, 1998>
(3) The provisions concerning revenue officials and finance officers from among those of the Liability of Accounting Personnel, etc. Act shall apply mutatis mutandis to the National Investment Fund Account Officer in Command and the Assistant Vice Governor in charge of the National Investment Fund Account, and the provisions concerning disbursement officers and accounting officials shall apply mutatis mutandis to the National Investment Fund Accounting Officials and National Investment Fund Accounting Officers. <Amended by Act No. 5505, Jan. 13, 1998>
Article 21(Temporary Borrowing) #
(1) The Minister of Finance and Economy may borrow temporarily from the Bank of Korea on liability of the National Investment Fund, if such needs arise in employing the National Investment Fund. <Amended by Act No. 4980, Dec. 6, 1995>
(2) Temporary loans referred to in Article 21 (1) shall be repaid within the same fiscal year.
Article 22(Revenue and Expenditure of National Investment Fund) #
(1) The National Investment Fund shall have as its revenue the incomes from issuance of national investment bonds, transfers, deposits, repayment, interests and other profits from the employment of the Fund.
(2) The National Investment Fund shall have as its expenditures the appropriations, loans, repayment of principals and interest, issuing expenses of national investment bonds and other administrative expenses.
Article 23(Employment of Surplus Funds) #
The Minister of Finance and Economy may employ any surplus funds from the National Investment Fund in the following ways: <Amended by Act No. 4980, Dec. 6, 1995>
1. Purchases of national bonds, public bonds, and other securities; and
2. Deposits at or short-term loans to financial institutions.
Article 24(Handling of Profits and Losses) #
(1) The National Investment Fund shall reserve all the profits, if any is available at the annual fiscal closing.
(2) When losses are made at the National Investment Fund, they shall be covered by the accumulated reserves under Article 24 (1); if the reserves are not enough, the general accounts of the Government shall provide the remainder.
Article 25(Approval of Annual Fiscal Closing) #
The Minister of Finance and Economy shall prepare a report on the annual fiscal closing of the National Investment Fund and get the approval of the President by March 31 of the next fiscal year, subject to the review by the State Council. <Amended by Act No. 4980, Dec. 6, 1995>
Article 26(Supervision) #
(1) The Minister of Finance and Economy may, where he deems it necessary in order to achieve the purpose of the Act, ask the acquirers of national investment bonds under Article 8 (1) or the financial institutions receiving appropriations from the National Investment Fund to submit account books, documents and related materials, or he may assign staff of the Ministry of Finance and Economy for the purpose of investigation; if matters in violation of this Act or orders given under this Act in executing the responsibilities are found a result, he may ask correction. <Amended by Act No. 4980, Dec. 6, 1995>
(2) The Minister of Finance and Economy may delegate the responsibilities of supervision referred to in paragraph (1) to the Governor of the Financial Supervisory Service. <Amended by Act No. 4980, Dec. 6, 1995; Act No. 5505, Jan. 13, 1998>
Article 27(Penal Provisions) #
(1) Those who commit the following offences with regard to the companies that receive investment or loans with the financial resources of the National Investment Fund under the provisions of this Act shall be subject to aggravated punishment as the following:
1. Those who commit the offences prescribed in Article 622 of the Commercial Act shall be punished by imprisonment for at least 1 year, but not exceeding 10 years, and by a fine not exceeding 5 million won; and
2. Those who commit the offences prescribed in Article 625, 628, or 630 of the Commercial Act shall be punished by imprisonment not exceeding 7 years and by a fine not exceeding 3 million won: Provided, That an exception shall be allowed for those listed in Article 623 of the Criminal Act.
(2) Criminal attempts under paragraph (1) 1 shall be punished.
(3) In the cases under paragraph (1) 2 , profits taken by those who have committed the offences prescribed in Article 630 (1) of the Commercial Act shall be confiscated. If all or part of the profits are not confiscated duly, they shall be collected by imposition.
(4) If those listed in Articles 622, 625, 628 and 630 (1) of the Commercial Act are corporate entities, the penal provisions under this Article shall apply to the directors, auditors, other employees or managers who are involved in the offences.
Article 28(Enforcement Decree) #
Matters necessary for the enforcement of this Act shall be determined by the Presidential Decree.