Article 1(Purpose) #
The purpose of this Decree is to prescribe the matters mandated by the Agricultural Cooperatives Act and matters necessary for the enforcement thereof.
[This Article Wholly Amended on Dec. 11, 2009]
Article 2(Authorization standards for establishment of cooperatives) #
The standards necessary for authorizing the establishment of an agricultural cooperative under Article 15(1) of the Agricultural Cooperatives Act (hereinafter referred to as the "Act") (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) shall be as follows: <Amended on Mar. 23, 2013; Jun. 22, 2021>
1. A local cooperative:
a. At least 1,000 persons qualified for membership shall consent to the establishment thereof (referring to members of the cooperative in the case of establishment by division or merger; hereinafter the same shall apply); provided, the number of such persons shall be at least 300 persons, if the business area of the relevant cooperative is the Special Metropolitan City or a Metropolitan City (excluding a Gun) or an island under the Island Development Promotion Act with less than 700 farm households, which is designated and notified by the Minister of Agriculture, Food and Rural Affairs;
b. The total amount of investment pledged to be made by persons qualified for membership who consent to establishment shall be at least 500 million won (referring to the total amount of investment in the case of establishment by division or merger; hereinafter the same shall apply);
2. An item cooperative:
a. At least 200 persons qualified for membership shall consent to the establishment thereof;
b. The total amount of investment pledged to be made by persons qualified for membership who consent to establishment shall be at least 300 million won.
[This Article Wholly Amended on Dec. 11, 2009]
Article 3(Authorization procedures for establishment of cooperatives) #
A person who intends to obtain authorization for the establishment of a cooperative under Article 15(1) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) shall submit to the Minister of Agriculture, Food and Rural Affairs an application for authorization for establishment, accompanied by the following documents: <Amended on Mar. 23, 2013>
1. The articles of association;
2. The minutes of an inaugural general meeting;
3. A business plan;
4. A list of executive officers;
5. Documents evidencing qualifications of members and compliance with the establishment authorization standards for the cooperative;
6. The minutes of the general meeting or voting records of members to pass a resolution on division or merger (applicable only to establishment following division or merger; and the scope of rights and obligations to be succeeded by the newly established cooperative shall be stated as matters subject to resolution).
[This Article Wholly Amended on Dec. 11, 2009]
Article 4(Qualifications for members of local agricultural cooperatives) #
(1) The scope of farmers qualified as members of a local agricultural cooperative under Article 19(1) of the Act (hereinafter referred to as "local agricultural cooperative") shall be as follows: <Amended on Mar. 23, 2013; Dec. 26, 2017; Jul. 2, 2019>
1. A person who operates or cultivates farmland of at least 1,000 square meters;
2. A person who engages in agriculture for at least 90 days a year;
3. A person who breeds more than 0.5 boxes of silkworm seeds [a standard box of 20,000 grains];
4. A person who raises livestock in excess of the standards prescribed in Appendix 1 and a person who raises livestock defined in subparagraph 1 of Article 2 of the Livestock Industry Act in excess of the standards determined and publicly notified by the Minister of Agriculture, Food and Rural Affairs;
5. A person who installs facilities of at least 330 square meters on farmland and grows horticultural crops therein;
6. A person who grows vegetables, fruit trees, or flowers on farmland of at least 660 square meters.
(2) Notwithstanding paragraph (1), the board of directors of a local agricultural cooperative may recognize a person referred to in any subparagraph of paragraph (1) as a farmer qualified as a member of the cooperative if he or she falls under any of the following. In such cases, the period of recognition shall not exceed one year from the date any of the following grounds arises: <Added on Dec. 26, 2017>
1. Where the person ceases to meet the requirements prescribed in paragraph (1)1 or 3 through 6 due to the expropriation or temporary sale of farmland or land, buildings, etc. used for the management of the agriculture or livestock industry under paragraph (1)1 or 3 through 6;
2. Where the person ceases to meet the requirements prescribed in paragraph (1)3 or 4 due to the temporary sale or purchase of silkworms or livestock under paragraph (1)3 or 4 or the culling of livestock under Article 20 of the Act on the Prevention of Contagious Animal Diseases;
3. Where the person temporarily fails to meet the requirements prescribed in the subparagraphs of paragraph (1) due to any unavoidable cause, such as a natural disaster.
(3) Matters necessary for the method, standards, etc. for verifying whether paragraph (1) or (2) is applicable shall be determined and publicly notified by the Minister of Agriculture, Food and Rural Affairs. <Amended on Mar. 23, 2013; Dec. 26, 2017>
[This Article Wholly Amended on Dec. 11, 2009]
Article 4-2(Standards for cooperatives required to formulate and implement plans for fostering committed members) #
"Local agricultural cooperative that meets the standards prescribed by Presidential Decree" in Article 24-2(3) of the Act (including cases applied mutatis mutandis in Articles 107(1) and 112(1) of the Act) means a local agricultural cooperative with at least 10/100 of its members using the economic business under Article 57(1)2 a of the Act (referring to subparagraph 2a of Article 106 of the Act if applied mutatis mutandis in Article 107(1) of the Act, and subparagraph 2 a of Article 111 of the Act if applied mutatis mutandis in Article 112(1) of the Act).
[This Article Added on Dec. 26, 2017]
[Previous Article 4-2 moved to Article 4-3 <Dec. 26, 2017>]
Article 4-3(Entries in list of members) #
The following matters shall be entered in the list of the members of a cooperative under Article 37(1) of the Act (including cases applied mutatis mutandis in Articles 107, 112, 112, 112-11 and 161 of the Act): <Amended on Jun. 30, 2015>
1. The name, and domicile or residence of members;
2. The date of joining the cooperative.
[This Article Added on Dec. 11, 2009]
[Moved from Article 4-2; previous Article 4-3 moved to Article 4-4 <Dec. 26, 2017>]
Article 4-4(Cooperatives required to have directors other than members of cooperative) #
"Meets the standards prescribed by Presidential Decree" in the latter part of Article 45(1) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) means where the total amount of assets stated in the recent report on the settlement of accounts approved at an ordinary general meeting pursuant to Article 71(3) of the Act before the commencement of the term of office of the president of the cooperative is at least 150 billion won.
[This Article Added on Dec. 11, 2009]
[Moved from Article 4-3; previous Article 4-4 moved to Article 4-5 <Dec. 26, 2017>]
Article 4-5(Cooperatives required to have standing directors) #
"Local agricultural cooperative ... meets the standards prescribed by Presidential Decree" in the proviso of Article 45(2) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) means a local agricultural cooperative whose total assets stated in the recent report on the settlement of accounts approved at an ordinary general meeting pursuant to Article 71(3) of the Act before the commencement of the term of office of the president of the cooperative is at least 150 billion won.
[This Article Wholly Amended on Dec. 11, 2009]
[Moved from Article 4-4; previous Article 4-5 moved to Article 4-7 <Dec. 26, 2017>]
Article 4-6(Cooperatives required to have standing auditors) #
"Local agricultural cooperative meeting the standards prescribed by Presidential Decree" in the proviso of Article 45(3) of the Act (including cases applied mutatis mutandis in Articles 107(1) and 112(1) of the Act) means a local agricultural cooperative whose total assets stated in the recent report on the settlement of accounts approved at an ordinary general meeting under Article 71(3) of the Act before the commencement of the term of office of the auditor is at least 800 billion won. <Amended on Oct. 8, 2024>
[This Article Added on Dec. 26, 2017]
Article 4-7(Cooperatives required to have non-standing president) #
"Where ... meets the standards prescribed by Presidential Decree" in Article 45(4) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) means where the total amount of assets stated in the recent report on the settlement of accounts approved at an ordinary general meeting pursuant to Article 71(3) of the Act before the commencement of the term of office of the president of the cooperative is at least 250 billion won. <Amended on Jun. 27, 2017>
[This Article Added on Dec. 11, 2009]
[Moved from Article 4-5 <Dec. 26, 2017>]
Article 5(Qualification requirements for standing directors and standing auditors of cooperative) #
(1) A standing director among "persons ... meet the requirements prescribed by Presidential Decree" in the proviso of Article 45(6) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) means any of the following: <Amended on Nov. 15, 2010; Jun. 27, 2017; Dec. 26, 2017>
1. A person with at least 5 years of service as a full-time position at a cooperative, the National Federation (including its subsidiaries and second-tier subsidiaries; hereafter the same shall apply in this Article), or the federation of item cooperatives established under Article 138 of the Act (hereinafter referred to as the "federation");
2. A person with at least 5 years of service as a full-time position at a State agency, a local government, a public institution under Article 4 of the Act on the Management of Public Institutions (hereinafter referred to as "public institution"), or an institution subject to inspection under Article 38 of the Act on the Establishment of Financial Services Commission (including a foreign financial institution equivalent thereto) related to the agricultural or livestock industry;
3. A person who has worked for a State agency, research institute, educational institution, or enterprise related to the agricultural or livestock industry, or the financial industry, and who meets the requirements prescribed by the articles of association of the cooperative as having qualifications equivalent to or higher than those prescribed in subparagraph 1 or 2.
(2) A standing auditor among "persons who meet the requirements prescribed by Presidential Decree" in the proviso of Article 45(6) of the Act (including cases applied mutatis mutandis in Articles 107(1) and 112(1) of the Act) means any of the following: <Added on Dec. 26, 2017>
1. A person with at least 5 years of service as a full-time position in auditing, accounting, finance, or finance-related affairs at a cooperative or the federation; provided, a person who has worked as an executive officer or employee for the relevant cooperative (excluding a person who is working or has worked as an auditor thereof) within the latest 2 years shall be excluded;
2. A person with at least 5 years of service as a full-time position in affairs related to audits, accounting, finance, or cooperatives at a State agency, local government, public institution, research institute, or educational institution related to the agricultural or livestock industry;
3. A person with at least 5 years of service as a full-time position in affairs related to audits, accounting, finance, finance, or cooperative at the National Federation, a State agency, a research institute, or an educational institution related to financial business, or an institution subject to inspection under Article 38 of the Act on the Establishment of Financial Services Commission (including a foreign financial institution equivalent thereto).
[This Article Wholly Amended on Dec. 11, 2009]
[Title Amended on Dec. 26, 2017]
Article 5-2(Scope of financial institutions subject to delinquency verification) #
"Financial Institutions prescribed by Presidential Decree" in Article 49(1)11d of the Act (including cases applied mutatis mutandis in Articles 107, 112, and 161 of the Act) means any of the following: <Amended on May 31 2016; Oct. 25 2016; Aug. 11 2020; Dec. 19 2023>
1. A cooperative, the NongHyup Bank, the NongHyup Life Insurance Co., Ltd., and the NongHyup Property and Casualty Insurance Co., Ltd.;
2. The Korea Technology Finance Corporation established under the Korea Technology Finance Corporation Act;
3. The credit guarantee fund for farmers and fishers established under the Act on the Credit Guarantee for Farmers and Fishers;
4. An insurance company under the Insurance Business Act;
5. A cooperative and the National Forestry Cooperative Federation under the Forestry Cooperatives Act;
6. A mutual savings bank and the Korea Federation of Savings Banks under the Mutual Savings Banks Act;
7. A community credit cooperative and the Korean Federation of Community Credit Cooperatives under the Community Credit Cooperatives Act;
8. A cooperative, the National Federation of Fisheries Cooperatives, and Suhyup Bank under the Fisheries Cooperatives Act;
9. The credit guarantee fund established under the Korea Credit Guarantee Fund Act;
10. A credit union and the National Credit Union Federation of Korea under the Credit Unions Act;
11. A specialized credit financial company under the Specialized Credit Finance Business Act;
12. Venture investment companies and venture investment funds under subparagraphs 10 and 11 of Article 2 of the Venture Investment Promotion Act;
13. A small and medium enterprise cooperative under the Small and Medium Enterprise Cooperatives Act;
14. A credit guarantee foundation and the Korea Federation of Credit Guarantee Foundations under the Regional Credit Guarantee Foundation Act;
15. The Export-Import Bank of Korea established under the Export-Import Bank of Korea Act;
16. The Korea Housing Finance Corporation established under the Korea Housing Finance Corporation Act.
[This Article Added on Nov. 30, 2012]
[Previous Article 5-2 moved to Article 5-3 <Nov. 30, 2012>]
Article 5-3(Business to be used by executive officers) #
(1) "Business prescribed by Presidential Decree" in Article 49(1)12 of the Act (including cases applied mutatis mutandis in Articles 107(1) and 112(1) of the Act) means the following:
1. The business referred to in Article 57(1)2a of the Act (referring to subparagraph 2a of Article 106 of the Act where it is applied mutatis mutandis in Article 107(1) of the Act, and subparagraph 2a of Article 111 of the Act where it is applied mutatis mutandis in Article 112(1) of the Act; hereafter the same shall apply in this Article). In such cases, it may include the joint sales of products under subparagraph 1 of Article 112-8 of the Act, among the businesses of a joint business corporation of cooperatives under Article 112-2 of the Act invested by the relevant cooperative;
2. Other businesses prescribed by the articles of association of the cooperative.
(2) In the case of a cooperative in which at least 50/100 of its members use the economic business under Article 57(1)2a of the Act, the business referred to in paragraph (1)1 shall be included.
[This Article Added on Dec. 26, 2017]
[Previous Article 5-3 moved to Article 5-4 <Dec. 26, 2017>]
Article 5-4(Scope of business in de facto competition) #
(1) The scope of businesses in a de facto competition under Article 52(5) of the Act (including cases applied mutatis mutandis in Articles 107, 112, 112, 112-11 and 161 of the Act) shall be those specified in Appendix 2, and shall be limited to the businesses conducted by the relevant cooperative, a joint business corporation of cooperatives under Article 112-3 of the Act, and the National Federation. <Amended on Jun. 30, 2015>
(2) Notwithstanding paragraph (1), no business conducted by a corporation invested by a cooperative, a joint venture business corporation of cooperatives, and the National Federation for business shall be deemed a business in a de facto competition.
[This Article Added on Dec. 11, 2009]
[Moved from Article 5-3 <Dec. 26, 2017>]
Article 6(Methods of credit business of cooperatives and limit on borrowing) #
(1) A cooperative shall conduct the credit business pursuant to Article 57(3) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) to the extent that the following standards are complied with: <Amended on Jun. 27, 2017>
1. Standards for management soundness under Article 83-3 of the Credit Unions Act;
2. Standards for timely corrective measures under Article 4(2) of the Act on the Structural Improvement of Agricultural Cooperatives.
(2) The total amount of funds that a cooperative may borrow from the National Federation, the NongHyup Agribusiness Group, its subsidiaries (limited to subsidiaries related to the relevant business), the NongHyup Bank, or the NongHyup Life Insurance Co., Ltd. pursuant to Article 57(3) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) shall not exceed the sum of the equity capital under Article 67(2) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) (hereinafter referred to as "equity capital") and respective surplus funds deposited in the National Federation or the NongHyup Bank under Article 66(1)1 and (including cases applied mutatis mutandis in Articles 107 and 112 of the Act); provided, a cooperative may borrow the amount in excess of the limit specified in the main clause if it borrows funds as prescribed by Decree of the Ministry of Agriculture, Food and Rural Affairs for the execution of agricultural policies, withdrawal of deposits, etc. <Amended on Jan. 6, 2012; Mar. 23, 2013; Jun. 30, 2015>
[This Article Wholly Amended on Dec. 11, 2009]
Article 7(Deposit of reserves for repayment) #
A cooperative shall deposit with the National Federation the reserves against deposits and installment savings according to the ratio determined by the Minister of Agriculture, Food and Rural Affairs in prior consultation with the Financial Services Commission.
[This Article Wholly Amended on Dec. 30, 2016]
Article 8(Methods of concluding contracts for projects entrusted by State, etc.) #
Where the State or a public organization concludes a project entrustment contract with a cooperative, the National Federation, the NongHyup Agribusiness Group, its subsidiary, or the NongHyup Bank under Article 57(4) of the Act (including cases applied mutatis mutandis in Articles 107, 112, and 161 of the Act), 161-4(1)4 of the Act, or Article 161-11(2)4 of the Act, such contract shall be in writing, specifying the following matters: <Amended on Jan. 6, 2012; Jun. 30, 2015; Jun. 27, 2017>
1. Objects and scope of the entrusted project;
2. Period of entrustment;
3. Other matters necessary for performing the entrusted project.
[This Article Wholly Amended on Dec. 11, 2009]
Article 8-2(Cooperatives subject to audit by external auditor) #
"Local agricultural cooperative ... is equal to or greater than the standards prescribed by Presidential Decree" in the proviso of Article 65-2(1) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) means a local agricultural cooperative whose total assets stated in the recent report on the settlement of accounts approved at an ordinary general meeting pursuant to Article 71(3) of the Act before the commencement of the term of office of the president of the cooperative is at least 50 billion won.
[This Article Wholly Amended on Dec. 11, 2009]
Article 9(Operation of surplus funds by cooperative) #
(1) "Financial institutions prescribed by Presidential Decree" in Article 66(1)2 of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) means the following: <Amended on Nov. 15, 2010; Jan. 6, 2012>
1. A bank under the Banking Act;
2. A collective investment business entity, a trust business entity, a merchant bank, an investment trader, or an investment broker under the Financial Investment Services and Capital Markets Act;
3. The Korea Development Bank established under the Korea Development Bank Act;
4. The Industrial Bank of Korea under the Industrial Bank of Korea Act;
5. A postal service office under the Postal Savings and Insurance Act;
6. A local cooperative and an item cooperative conducting the credit business.
(2) "Securities prescribed by Presidential Decree" in Article 66(1)3 of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act) means the following securities determined and publicly notified by the Minister of Agriculture, Food and Rural Affairs in consultation with the Financial Services Commission, to the extent not likely to undermine the stability of the management of surplus funds of a cooperative: <Amended on Jan. 6, 2012; Mar. 23, 2013; Dec. 30, 2016>
1. State bonds, local government bonds, special purpose bonds, corporate bonds, and corporate commercial paper under Article 4 (3) of the Financial Investment Services and Capital Markets Act;
2. Beneficiary certificates issued by a trust business entity, a collective investment business entity, and a comprehensive financial company under the Financial Investment Services and Capital Markets Act;
3. Other securities prescribed by the Minister of Agriculture, Food and Rural Affairs.
(3) The limit and scope of operation of securities by cooperative under paragraph (2) shall be determined by the board of directors of the National Federation to the extent that it does not impede the sound operation of surplus funds.
[This Article Wholly Amended on Dec. 11, 2009]
Article 10(Qualifications for members of local livestock cooperatives) #
(1) The scope of farmers who run the livestock business, which is a qualification requirement for membership of a local livestock cooperative under Article 105(2) of the Act, shall be as follows: <Amended on Mar. 23, 2013; Dec. 26, 2017>
1. A person who raises livestock in excess of the standards prescribed in Appendix 3;
2. Any other person who raises livestock in excess of the standards determined and publicly notified by the Minister of Agriculture, Food and Rural Affairs, among livestock defined in subparagraph 1 of Article 2 of the Livestock Industry Act.
(2) Notwithstanding paragraph (1), the board of directors of a local livestock cooperative may recognize a person referred to in any subparagraph of paragraph (1) as a farmer running the livestock business qualified as a member of the cooperative if he or she falls under any of the following. In such cases, the period of recognition shall not exceed one year from the date any of the following grounds arises: <Added on Dec. 26, 2017>
1. Where the person ceases to meet the requirements prescribed in paragraph (1)1 or 2 due to the expropriation or temporary sale of land, buildings, etc. used for the management of the livestock business under paragraph (1)1 or 2;
2. Where the person ceases to meet the requirements prescribed in paragraph (1)1 or 2 due to the temporary sale or purchase of or livestock under paragraph (1)1 or 2 or the culling of livestock under Article 20 of the Act on the Prevention of Contagious Animal Diseases;
3. Where the person temporarily fails to meet the requirements prescribed in paragraph (1)1 or 2 due to any unavoidable cause, such as a natural disaster.
(3) Matters concerning the methods, standards, etc. for verifying whether paragraphs (1) and (2) are applicable shall be determined and publicly notified by the Minister of Agriculture, Food and Rural Affairs. <Added on Dec. 26, 2017>
[This Article Wholly Amended on Dec. 11, 2009]
Article 11(Scope of livestock breeding business of item cooperatives) #
"Livestock breeding business prescribed by Presidential Decree" in Article 108 of the Act means the following:
1. Beekeeping;
2. Rabbit breeding;
3. Deer breeding;
4. Goat breeding;
5. Dog breeding;
6. Furry animal breeding;
7. Horse breeding;
8. Duck breeding.
[This Article Wholly Amended on Dec. 11, 2009]
Article 11-2(Standards and procedures for authorization for establishment of joint business corporation of cooperatives) #
(1) The standards necessary for authorizing the establishment of a joint business corporation of cooperatives under Article 112-5(2) of the Act shall be as follows:
1. At least 2 persons qualified for membership shall consent to the establishment thereof (limited to cooperatives; hereafter the same shall apply in subparagraph 2);
2. The total amount of investment pledged to be made by persons qualified for membership who consent to establishment shall be at least 300 million won.
(2) Article 3 shall apply mutatis mutandis to procedures for authorizing the establishment of a joint business corporation of cooperatives. In such cases, "Article 15(1) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act)" shall be construed as "Article 112-5(1) of the Act", "cooperative" as "joint business corporation of cooperatives" and "members of a cooperative" as "members", respectively.
[This Article Wholly Amended on Dec. 11, 2009]
Article 11-3(Standards for refusal of membership by National Federation) #
"Standards prescribed by Presidential Decree" in the former part of Article 115(2)3 of the Act means the following: <Amended on Dec. 26, 2017>
1. Where it is not equipped with the minimum electronic computer system compatible with that of the National Federation;
2. Where the board of directors of the National Federation determines that it is a cooperative in whose case 2 years have not passed since its withdrawal for the purpose of evading expulsion;
3. Where the board of directors of the National Federation determines that the cooperative inflicted property damage on the National Federation (including its subsidiaries and second-tier subsidiaries) or its members or injured their reputation by violating agricultural cooperatives-related statutes or regulations, administrative orders issued under such statutes or regulations, or articles of association, and that 2 years have not passed since it rectified such violation.
[This Article Wholly Amended on Dec. 11, 2009]
Article 11-4(Standards for exercising voting rights at general meeting of National Federation) #
(1) "Standards prescribed by Presidential Decree, such as the number of members of the relevant cooperative" in Article 122(5) of the Act means the following: <Amended on Apr. 12, 2022>
1. One vote for a cooperative or federation with less than 2,000 members;
2. Two votes for a cooperative with at least 2,000 but less than 3,000 members;
3. Three votes for a cooperative with at least 3,000 members.
(2) The number of members serving as the basis for exercising voting rights at the general meeting of the National Federation pursuant to paragraph (1) shall be determined at an ordinary general meeting of the National Federation each year on the basis of the end of the immediately preceding fiscal year.
(3) Notwithstanding paragraph (2), in the case of a cooperative merged or newly established after an ordinary general meeting, the board of directors of the National Federation shall determine the number of members on the basis of the registration date of the merger or establishment.
[This Article Wholly Amended on Dec. 11, 2009]
Article 11-5(Qualification requirements for compliance officers) #
(1) "Persons who meets the qualification requirements prescribed by Presidential Decree" in Article 125-4(3) of the Act means those who meet all of the following requirements: <Amended on Jan. 6, 2012; Feb. 29, 2012; Mar. 23, 2013; Dec. 26, 2017; Apr. 12, 2022>
1. A person with any of the following work experiences:
a. A person who has at least 10 years' work experience at the National Federation (including its subsidiary or second-tier subsidiary) or an institution subject to inspection under Article 38 of the Act on the Establishment of Financial Services Commission (including a foreign financial institution equivalent thereto);
b. A person who holds a master's degree or higher in a field related to the agricultural or livestock industry, or finance, and has at least 5 years' work experience as a researcher or assistant professor or higher at a research institute or college;
c. A person who is qualified as an attorney-at-law or a certified public accountant and has at least 5 years' work experience in the relevant business;
d. A person who has at least 5 years' work experience at a State agency or local government related to the field of the agricultural or livestock industry, or financial business, and for whom 3 years have passed since his or her resignation or retirement;
2. A person not falling under any subparagraph of Article 49(1) of the Act (excluding subparagraphs 10 through 12);
3. A person without any record of being subjected to demand for caution or warning, or any severer measure, by the Financial Services Commission, the Governor of the Financial Supervisory Service, or the Minister of Agriculture, Food and Rural Affairs for a violation of finance-related or agricultural cooperatives-related statutes or regulations during the latest 5 years.
(2) A compliance officer shall perform his or her duties with the care of a good manager and shall not take charge of the following: <Amended on Jan. 6, 2012>
1. Business related to asset management;
2. Mutual financial business and economic business conducted by the National Federation, and incidental businesses related thereto.
[This Article Wholly Amended on Dec. 11, 2009]
Article 11-6(Internal control standards) #
(1) The internal control standards under Article 125-4(4) of the Act (hereinafter referred to as "internal control standards") shall include matters regarding the following: <Amended on Mar. 23, 2013>
1. Division of duties and organizational structure;
2. Management of risks arising in the course of the operation of assets or the performance of duties;
3. Procedures to be observed by executive officers and employees when performing their duties;
4. Establishment of a system through which information necessary for the management decision-making can be efficiently communicated;
5. Procedures and methods for confirming whether executive officers and employees comply with internal control standards, and handling of executive officers and employees who have violated internal control standards;
6. Procedures or standards for preventing unfair trading practices, such as reporting on the details of securities trading by executive officers and employees;
7. Procedures for establishing or amending internal control standards;
8. Detailed standards regarding the matters listed in subparagraphs 1 through 7, as prescribed by the Minister of Agriculture, Food and Rural Affairs or the Financial Services Commission.
(2) If the National Federation intends to establish or amend the internal control standards, it shall undergo a resolution of the board of directors.
[This Article Wholly Amended on Dec. 11, 2009]
Article 11-7(Qualification requirements for audit committee members of National Federation) #
"External experts who meet the requirements prescribed by Presidential Decree" in the main clause of Article 129(2) of the Act means any of the following persons: <Amended on Feb. 29, 2012; Dec. 26, 2017; Apr. 12, 2022>
1. A person who has at least 10 years' work experience at the National Federation (including its subsidiary or second-tier subsidiary), a cooperative, or an institution subject to inspection under Article 38 of the Act on the Establishment of Financial Services Commission (including a foreign financial institution equivalent thereto);
2. A person who holds a master's degree or higher in a field related to the agricultural or livestock industry, or finance, and has at least 5 years' work experience as a researcher or assistant professor or higher at a research institute or college;
3. A person with at least 5 years of service as a judge, public prosecutor, military advocate, attorney-at-law, or certified public accountant.
4. A person who has at least 5 years' work experience as an executive officer or at least 10 years' work experience as an executive officer or employee of a stock-listed corporation under Article 9(15)3 of the Financial Investment Services and Capital Markets Act in the business affairs related to law, finance, audit or accounting;
5. A person who has at least 5 years' work experience in finance or accounting-related affairs and supervision thereof at a State agency, a local government, a public institution, or the Financial Supervisory Service.
[This Article Added on Dec. 11, 2009]
Article 11-8(Standards for exercising voting rights in election of National Federation Chairperson) #
(1) "Standards prescribed by Presidential Decree, such as the number of members" in the latter part of Article 130(1) of the Act means the following:
1. One vote for a cooperative or federation with fewer than 3,000 members;
2. Two votes for a cooperative with at least 3,000 members.
(2) Article 11-4(2) and (3) shall apply mutatis mutandis to the calculation of the number of members of a cooperative under the subparagraphs of paragraph (1).
[This Article Added on Apr. 12, 2022]
Article 12(Qualification requirements for business unit-specific chief executive officer of National Federation) #
"Persons ... who meet the requirements prescribed by Presidential Decree" in Article 130(2) of the Act means any of the following: <Amended on Nov. 15, 2010; Jan. 6, 2012>
1. Deleted; <Jun. 27, 2017>
2. A chief mutual finance executive officer shall be a person with at least 10 years' work experience at the National Federation, or a financial business-related State agency, a research institute, an educational institute, a company with an equity capital of at least 20 billion won. In such cases, experience in the business sector under Article 128(1)1 or (2)1 of the previous Act (referring to that partially amended by Act No. 14481 on Dec. 27, 2016) shall be excluded;
3. A managing director shall be a person with at least 10 years' work experience at the National Federation, or an agricultural, livestock or financial business-related State agency, research institute, educational institute, company with an equity capital of at least 20 billion won;
4. Deleted. <Jan. 6, 2012>
[This Article Wholly Amended on Dec. 11, 2009]
[Title Amended on Jun. 27, 2017]
Article 12-2(Qualification requirements for directors of National Federation other than president of cooperative) #
"Persons who meet the requirements prescribed by Presidential Decree" in Article 130(4) of the Act means those with expert knowledge or practical experience, who have worked or engaged in research or survey in the fields of agricultural or livestock business, finance, business administration, economy, law, accounting, welfare, consumer protection, etc.
[This Article Added on Dec. 26, 2017]
Article 13(Registration of appointment of agent) #
(1) Where the Chairperson of the National Federation (hereinafter referred to as "Chairperson of the National Federation"), a chief mutual finance officer, a managing director, the chairperson of the audit committee for cooperatives, or the representatives of the NongHyup Agribusiness Group, NongHyup Financial Group, Nonghyup Bank, Nonghyup Life Insurance, or Nonghyup Property and Casualty Insurance appoints an agent under Article 131(6) of the Act, the following matters shall be registered at the location of the principal office within 2 weeks after the appointment. The same shall also apply where any registered matter is changed: <Amended on Jan. 6, 2012; June 27, 2017; Apr. 12, 2022; Jan. 21, 2025>
1. Name and address of the agent;
2. The principal office or branch office having an agent;
3. Where the authority of the agent is restricted, the details of such restriction.
(2) Where an application for registration of appointment of an agent is filed pursuant to paragraph (1), a document certifying the appointment of an agent (in cases falling under paragraph (1)3, including a document certifying such restriction) shall be attached thereto.
[This Article Wholly Amended on Dec. 11, 2009]
Article 14 #
Deleted. <Dec. 30, 2016>
Article 15(Operation and management of surplus funds of members) #
(1) When the National Federation operates and manages the surplus funds of its members under Article 134(1)4a of the Act, it shall do so by the following methods: <Amended on Jan. 6, 2012; Mar. 23, 2013>
1. Lending to members;
2. Making a deposit in the Bank of Korea or financial institutions (referring to financial institutions under the subparagraphs of Article 9 (1); hereinafter the same shall apply);
3. Lending to financial institutions;
4. Lending to public institutions;
5. Purchase of securities under Article 4 of the Financial Investment Services and Capital Markets Act;
6. Trading of derivatives under Article 5(1) of the Financial Investment Services and Capital Markets Act;
7. Lending to corporations;
8. Operation of the funds for other business sectors of the National Federation;
9. Any other methods determined by the Minister of Agriculture, Food and Rural Affairs in consultation with the Financial Services Commission.
(2) Loans to corporations under paragraph (1)7 shall not exceed 1/3 of the remaining balance of the surplus funds in deposit as of the end of the immediately preceding fiscal year, and loans to a single corporation shall not exceed 5/100 of the remaining balance of surplus funds in deposit as at the time of lending; provided, this shall not apply where payment is guaranteed by a financial institution under Article 9(1)1, the Credit Guarantee Fund under the Credit Guarantee Fund Act, the Korea Technology Finance Corporation under the Korea Technology Finance Corporation Act, the Housing Finance Credit Guarantee Fund under the Korea Housing Finance Corporation Act, the Credit Guarantee Fund for Farmers and Fishers under the Act on the Credit Guarantee for Farmers and Fishers, or a regional credit guarantee foundation under the Regional Credit Guarantee Foundation Act. <Amended on Jan. 6, 2012; May 31, 2016>
[This Article Wholly Amended on Dec. 11, 2009]
Article 15-2(Operation and management of reserves for repayment to members) #
When the National Federation operates and manages the reserves for repayment to its members under Article 134(1)4a of the Act, it shall do so by the following methods: <Amended on Jan. 6, 2012>
1. Lending to members;
2. Making a deposit in the Bank of Korea or financial institutions;
3. Short-term lending to financial institutions;
4. Short-term lending to public institutions;
5. Short-term lending to enterprises that process agricultural products or produce agricultural materials (limited to corporations whose equity capital is not less than 10 billion won and debt-to-equity ratio is not more than 200 percent);
6. Purchase of securities under Article 4 of the Financial Investment Services and Capital Markets Act;
7. Trading of derivatives for hedging the risk related to the purchase of securities under subparagraph 6.
[This Article Wholly Amended on Dec. 11, 2009]
Article 15-3(Scope of incidental business) #
The National Federation may conduct the following businesses incidental to the business prescribed in Article 134(1)4a of the Act. In such cases, if the relevant business is subject to authorization, permission, etc. pursuant to other statutes or regulations, such business may be conducted within the scope of the relevant authorization, permission, etc. granted: <Amended on January 6, 2012>
1. Lending and borrowing transactions of securities;
2. Trading of repurchase agreements; provided, the sales transaction shall be limited to the State, local governments, public institutions, the Bank of Korea, or financial institutions.
[This Article Added on Dec. 11, 2009]
Article 15-4 #
Deleted. <Jun. 27, 2017>
Article 15-5 #
Deleted. <Jun. 27, 2017>
Article 16(Equity capital as basis for limits on investment by National Federation) #
The equity capital referred to in the main clause of Article 137(2) of the Act shall be calculated by summing up investments (referring to paid-in investments, revolving investments, non-cumulative preferential investments, subscription fees, etc.), capital surplus, retained earnings (referring to the amount deducted from losses carried forward, if any), capital adjustment, and accumulated amount of other comprehensive income.
[This Article Wholly Amended on January 6, 2012]
Article 17(Information subject to disclosure, including details of use of State subsidies or loans) #
"Information prescribed by Presidential Decree, such as the details of the use of funds" in Article 139(1) of the Act means the following information:
1. Name of the project;
2. Amount subsidized or loaned;
3. Project execution entity;
4. Project period;
5. Details of the use of funds;
6. Other information on a State-subsidized or loan project that the National Federation deems necessary to disclose to the public.
[This Article Added on Jun. 30, 2015]
Article 18 #
Deleted. <Dec. 15, 2001>
Article 19 #
Deleted. <Dec. 15, 2001>
Article 20 #
Deleted. <Dec. 15, 2001>
Article 21 #
Deleted. <Dec. 15, 2001>
Article 22(Qualification requirements for chairperson and members of audit committee for cooperatives) #
"Persons ... who meet the requirements prescribed by Presidential Decree" in Article 144(3) of the Act means any of the following: <Amended on Nov. 15, 2010; Dec. 26, 2017; Apr. 12, 2022>
1. A person with at least 10 years of service as a full-time position in the field of audit, accounting, or agricultural policy at a cooperative, the National Federation (including its subsidiary or second-tier subsidiary), a federation, or an institution subject to inspection under Article 38 of the Act on the Establishment of Financial Services Commission (including a foreign financial institution equivalent thereto);
2. A person who has worked in a State agency, research institute, educational institution, or company related to the agricultural or livestock industry, or financial industry and who meets the requirements prescribed by the articles of association of the National Federation as having qualifications equivalent to or higher than those prescribed in subparagraph 1;
3. A person with at least 5 years of service as a judge, public prosecutor, military advocate, attorney-at-law, or certified public accountant.
[This Article Wholly Amended on Dec. 11, 2009]
Article 23(Public announcement of matters concerning issuance of preferential investment) #
When issuing preferential investment pursuant to Article 147 of the Act, the National Federation shall publicly announce the details of such preferential investment, the number of units, the issue price, the payment date and the method of subscription, and shall notify investors and preferential investors 2 weeks before the payment date of preferential investment.
[This Article Wholly Amended on Dec. 11, 2009]
Article 24(Subscription for preferential investment) #
(1) A person intending to subscribe for preferential investment shall write the number of units of preferential investment, the subscription price, and the address in the subscription form for preferential investment, and shall sign and seal thereon.
(2) The preferential investment subscription form shall be prepared by the National Federation Chairperson, and shall include the following matters:
1. Name of the National Federation;
2. The value of one unit of investment and the total number of units;
3. Maximum limit on the total number of units of preferential investment;
4. The types of preferential investment already issued and the number of units by type;
5. Equity capital of the National Federation under Article 137(2) of the Act;
6. The face value, details, and number of units of preferential investment to be issued;
7. The issue price and payment date of preferential investment to be issued;
8. Where preferential investment is purchased and retired pursuant to Article 30, matters concerning such purchase and retirement.
[This Article Wholly Amended on Dec. 11, 2009]
Article 25(Payment for preferential investment) #
(1) A person who has applied for preferential investment may subscribe to such preferential investment for the number of units of preferential investment allocated by the National Federation Chairperson.
(2) A person intending to subscribe to preferential investment pursuant to paragraph (1) shall make a full payment for preferential investment issued by the due date.
(3) A person who has subscribed to preferential investment shall become a preferential investor from the date immediately following the payment date of the issue price of preferential investment.
[This Article Wholly Amended on Dec. 11, 2009]
Article 26(Issuance of preferential investment securities) #
(1) No preferential investment securities (hereinafter referred to as "securities") shall be issued unless a full payment is made for the preferential investment. <Amended on Dec. 26, 2017>
(2) The National Federation shall issue securities without delay after the payment date for preferential investment. <Added on Dec. 26, 2017>
[This Article Wholly Amended on Dec. 11, 2009]
[Title Amended on Dec. 26, 2017]
Article 27(Form of securities) #
Securities shall be in registered form.
Article 28(Matters to be entered in securities) #
The following matters, the securities number, the date of issuance, the number of preferential investment units, and the names of preferential investors (in the case of a corporation, referring to the corporate name; hereinafter the same shall apply) shall be written on the securities, and the name and seal of the National Federation Chairperson shall be affixed thereon:
1. Name of the National Federation;
2. Face value of preferential investment;
3. Details of preferential investment.
[This Article Wholly Amended on Dec. 11, 2009]
Article 29(Keeping of list of preferential investors and entries therein) #
The National Federation shall keep a list of preferential investors at its principal office and enter the following matters:
1. The name and address of the holder of securities;
2. The number and serial number of securities;
3. The date of acquisition of securities.
[This Article Wholly Amended on Dec. 11, 2009]
Article 30(Purchase and retirement of preferential investment) #
The National Federation may purchase and retire preferential investment following a resolution of the board of directors.
[This Article Wholly Amended on Dec. 11, 2009]
Article 30-2(Liability of preferential investors) #
The liability of a preferential investor shall be limited to the underwriting value of the preferential investment he or she holds.
[This Article Added on Dec. 26, 2017]
Article 30-3(Transfer of preferential investment) #
(1) Preferential investment may be transferred; provided, the transfer before the issuance of securities shall not be effective against the National Federation.
(2) When preferential investment is transferred, securities shall be delivered.
(3) The occupant of securities shall be presumed to be a legitimate holder thereof.
(4) Unless the name and address of the acquirer are registered in the list of preferential investors and his or her name is entered in the securities, the change of ownership of securities shall not be set up against the National Federation or any other third party.
(5) In a case where securities are subject to pledge, it shall not be set up against the National Federation or any other third party unless the name and address of the pledgee are registered in the list of preferential investors.
[This Article Added on Dec. 26, 2017]
Article 30-4(General meeting of preferential investors) #
(1) Where an amendment to the articles of association is to cause any loss to preferential investors, the National Federation shall undergo a resolution by a general meeting of preferential investors.
(2) A resolution at a general meeting of preferential investors under paragraph (1) shall require the attendance of investors representing a majority of the total units of preferential investment issued and the concurring vote representing at least 2/3 of the number of units held by investors present.
(3) Matters necessary for the operation of the general meeting of preferential shareholders under paragraph (1) shall be determined by the articles of association.
[This Article Added on Dec. 26, 2017]
Article 31(Notification and peremptory notice) #
A notice or peremptory notice to an applicant for preferential investment or a preferential investor shall be sent to the address stated in the application for preferential investment or the list of preferential investors, except when the address other than that is notified to the National Federation.
[This Article Wholly Amended on Dec. 11, 2009]
Article 31-2(Preferential investment in cooperatives, etc.) #
(1) Articles 23 through 31 shall apply mutatis mutandis to preferential investment in a cooperative. In such cases, "National Federation" shall be respectively construed as "cooperative", "members" as "members of a cooperative", "Article 147 of the Act" in Article 23 as "Article 21-2, 107(2) or 112(2) of the Act", and "National Federation Chairperson" in Articles 24(2), 25(1) and 28 as "president of a cooperative".
(2) Articles 23 through 31 shall apply mutatis mutandis to preferential investment in a joint business corporation of cooperatives. In such cases, "National Federation" shall be respectively construed as "joint business corporation of cooperatives", "Article 147 of the Act" in Article 23 as "Article 112-11(2) of the Act", and "National Federation Chairperson" in Articles 24(2), 25(1) and 28 as "chief executive officer". <Amended on Jun. 30, 2015>
(3) No cooperative, joint business corporation of cooperatives, federation (hereinafter referred to as "cooperative, etc."), or the National Federation (including its subsidiaries and second-tier subsidiaries; hereafter the same shall apply in this paragraph) shall make any of the following preferential investments: <Amended on Dec. 30, 2016; Dec. 26, 2017>
1. Preferential investment by a cooperative in another cooperative;
2. Preferential investment in a cooperative made by a joint business corporation of cooperatives, a federation, or the National Federation.
[This Article Wholly Amended on Dec. 11, 2009]
Article 32(Agricultural financial bonds) #
Agricultural financial bonds issued by the National Federation or the Nonghyup Bank pursuant to Article 153(1) of the Act (hereinafter referred to as "bonds") shall be in bearer form; provided, at the request of the subscriber or owner, the bonds in bearer form may be converted into registered form and vice versa. <Amended on Jan. 6, 2012>
[This Article Wholly Amended on Dec. 11, 2009]
Article 33(Public offering of bonds) #
(1) A person intending to subscribe to bonds shall enter the amount of the relevant bonds and address in 2 copies of a bond subscription form and shall sign and seal thereon.
(2) A bond subscription form shall be prepared by the National Federation Chairperson or the representative of the NongHyup Bank, and shall include the following matters: <Amended on Jan. 6, 2012>
1. Name of the National Federation or the NongHyup Bank;
2. Total amount of bonds issued;
3. The face value of bonds by title;
4. Interest rates for bonds;
5. Method and timing of repaying the principal;
6. Method and timing of paying interests;
7. The issuance value of bonds or the minimum value thereof;
8. Equity capital of the National Federation or the NongHyup Bank;
9. Where bonds are issued for the refinancing of bonds under Article 153(3) of the Act, matters concerning them;
10. Where there are outstanding bonds already issued, the total amount thereof.
(3) Where the minimum value of bonds has been determined, the subscriber shall state the subscription value in the bond subscription form.
[This Article Wholly Amended on Dec. 11, 2009]
Article 34(Acceptance of bonds by contract) #
`Article 33 shall not apply to the acceptance of the total amount of bonds under a contract.
[This Article Wholly Amended on Dec. 11, 2009]
Article 35(Total amount of bonds issued) #
The National Federation or the NongHyup Bank may indicate on the bond subscription form that it intends to issue bonds even in cases where the total amount of bonds actually subscribed to falls short of the total amount of bonds issued as stated in the bond subscription form. In such cases, the total amount of bonds issued shall be the total subscription amount. <Amended on Jan. 6, 2012>
[This Article Wholly Amended on Dec. 11, 2009]
Article 36(Payment for acceptance of bonds) #
When subscription for bonds is completed, the National Federation or the NongHyup Bank shall make a payment for each bond without delay. <Amended on Jan. 6, 2012>
[This Article Wholly Amended on Dec. 11, 2009]
Article 37(Timing for issuance of bonds) #
Except in cases of issuance pursuant to Article 38, no bonds may be issued before a full payment is made for the bonds.
[This Article Wholly Amended on Dec. 11, 2009]
Article 38(Issuance of bonds by sale) #
(1) Bonds may be issued by sale. In such cases, the sales period shall be determined in advance.
(2) In cases falling under paragraph (1), a subscription form for bonds shall not be required.
(3) Matters referred to in Article 33(2)1 and 3 through 6 and the bond number shall be stated in the bonds issued under paragraph (1).
[This Article Wholly Amended on Dec. 11, 2009]
Article 39(Public announcement of bond sales) #
Where the National Federation or the NongHyup Bank intends to issue bonds by means of sale, it shall publicly announce the sales period and the matters referred to in Article 33(2)1 through 7. <Amended on Jan. 6, 2012>
[This Article Wholly Amended on Dec. 11, 2009]
Article 40(Keeping of bond register and matters to be entered therein) #
The National Federation or the NongHyup Bank shall keep a bond register, which contains the following information, in its principal office: <Amended on Jan. 6, 2012>
1. The number of bonds by title and serial numbers thereof;
2. The date of issuance;
3. Matters referred to in Article 33(2)2 through 6;
4. The name of the owner of the bonds (in cases of a corporation, its corporate name) and address (limited to registered bonds).
[This Article Wholly Amended on Dec. 11, 2009]
Article 41(Perusal of bond register) #
The right holder of a bond may request a perusal of the bond register at any time during the business hours of the principal office.
[This Article Wholly Amended on Dec. 11, 2009]
Article 42(Purchase and retirement of bonds) #
The National Federation or the NongHyup Bank may purchase bonds and retire them following a resolution of the board of directors. <Amended on Jan. 6, 2012>
[This Article Wholly Amended on Dec. 11, 2009]
Article 43(Defects in interest coupons) #
(1) Where there is any defect in interest coupons of bearer bonds to be redeemed, the amount equivalent to the defective interest coupons shall be deducted from the amount of redemption.
(2) The holder of the interest coupons for which the amount equivalent to the interest coupons is deducted from the amount of redemption pursuant to paragraph (1) may at any time demand the payment of the interest coupons and the deducted amount.
[This Article Wholly Amended on Dec. 11, 2009]
Article 44(Notice and peremptory notice) #
(1) A notice or peremptory notice to a subscriber for bonds shall be sent to the address stated in the subscription form, except when the address other than that is notified to the National Federation or the NongHyup Bank. <Amended on Jan. 6, 2012>
(2) A notice or peremptory notice to the holder of registered bonds shall be sent to the address stated in the bond ledger, except when the address other than that is notified to the National Federation or the NongHyup Bank. <Amended on Jan. 6, 2012>
(3) A notice or peremptory notice to the holders of bearer bonds shall be made by means of public announcement.
[This Article Wholly Amended on Dec. 11, 2009]
Article 45(Mediation of disputes between members) #
(1) In order to promote the sound development of members, the National Federation may establish and operate a dispute mediation committee, the purpose of which is to autonomously mediate disputes surrounding the business areas, scope of business, etc. of cooperatives, etc. and the National Federation (including its subsidiaries and second-tier subsidiaries). <Amended on Dec. 26, 2017>
(2) Matters necessary for the composition, operation, etc. of the dispute mediation committee under paragraph (1) shall be prescribed by the articles of association of the National Federation.
[This Article Wholly Amended on Dec. 11, 2009]
Article 45-2(Qualification requirements for chief executive officer of NongHyup Agribusiness Group) #
"A person who ... meets the standards prescribed by Presidential Decree" in the main clause of Article 161-3(2) means any of the following persons:
1. A person who has at least 10 years' work experience at the National Federation, the NongHyup Agribusiness Group, or its subsidiary. In such cases, her or her career in the credit business (including mutual aid business and incidental business) of the National Federation under the previous Act (referring to that before partially amended by Act No. 10522 on Mar. 31, 2011) and in the business sector referred to in Article 127(3)1 of the Act shall be excluded herefrom;
2. A person who has at least 10 years' work experience at a State agency, research institute, educational institution, or company with its equity capital of at least 20 billion won, related to the agriculture or livestock industry.
[This Article Added on Dec. 26, 2017]
[Previous Article 45-2 moved to Article 45-4 <Dec. 26, 2017>]
Article 45-3(Requirements for external experts of executive officer recommendation committee of NongHyup Agribusiness Group) #
"External experts prescribed by Presidential Decree" in the main clause of Article 161-3(2) of the Act means persons commissioned by the board of directors of the NongHyup Agribusiness Group, from among persons with extensive knowledge and experience as recommended by farmers' organizations, academic circles, etc. (excluding public officials).
[This Article Added on Dec. 26, 2017]
Article 45-4(Business where NongHyup Agribusiness Group and its subsidiary are deemed as National Federation) #
"Business prescribed by Presidential Decree" in Article 161-4(2) of the Act means any of the businesses specified in Appendix 4.
[This Article Added on Jun. 27, 2017]
[Moved from Article 45-2 <Dec. 26, 2017>]
Article 45-5(Guidance and supervision over subsidiaries of NongHyup Agribusiness Group) #
(1) Pursuant to Article 161-8 of the Act, the NongHyup Agribusiness Group shall guide and supervise its subsidiaries (including its second-tier subsidiaries; hereafter the same shall apply in this Article) with respect to the matters regarding the following:
1. Formulation and modification of a business plan and income and expenditure budget;
2. Evaluation of management performance;
3. Amendments to articles of association;
4. Governance structure;
5. Others deemed necessary by the board of directors of the NongHyup Agribusiness Group.
(2) In guiding and supervising on the matters listed in paragraph (1), the NongHyup Agribusiness Group shall maintain the sound management of its subsidiaries and take into account the purposes prescribed in Article 161-2(2) of the Act.
[This Article Added on Dec. 26, 2017]
Article 46(Supervision by Minister of Agriculture, Food and Rural Affairs and others) #
(1) Where necessary for supervision pursuant to Articles 161-11(7) and 162(1) of the Act, the Minister of Agriculture, Food and Rural Affairs may request cooperatives, etc., the National Federation, and the NongHyup Bank to submit data on their business affairs or property, may require relevant public officials to audit their business affairs and property status or to make a necessary report, and may take necessary measures based on the results thereof. <Amended on Jan. 6, 2012; Mar. 23, 2013; Jun. 27, 2017>
(2) The Minister of Agriculture, Food and Rural Affairs shall determine and publicly notify details, such as procedures and methods necessary for efficiently supporting cooperatives, etc. and the National Federation under Article 9(2) of the Act and effectively providing supervision under Article 162 of the Act. <Amended on Mar. 23, 2013>
(3) The head of a local government may, if necessary for supervision under Article 162(4) of the Act, request cooperatives, etc. to submit data on their business affairs or property, nay require relevant public officials to audit its business affairs or property status or to make a necessary report, and may take necessary measures based on the results thereof. <Added on Sep. 8, 2020>
(4) The Financial Services Commission may request the submission of data on the credit business of a cooperative and the business affairs or property of the NongHyup Bank for supervision and order under Article 162(5) of the Act. <Added on Jan. 6, 2012; Sep. 8, 2020>
[This Article Wholly Amended on Dec. 11, 2009]
[Title Amended on Jan. 6, 2012; Mar. 23, 2013]
Article 47(Methods of management guidance) #
(1) In principle, management guidance under Article 166(1) of the Act shall be provided in writing after receiving data necessary therefor; provided, employees may be dispatched to the office of a cooperative, etc. to provide on-site guidance in any of the following cases:
1. Where there is a high possibility that the cooperative, etc. under management guidance is engaged in illegal management;
2. Where the cooperative, etc. shows a poor performance in the collection of illegal or non-performing loans and is deemed unable to correct the problem on its own;
3. Where illegal or non-performing loans are additionally made;
4. Other cases similar to those referred to in subparagraphs 1 and 2, where it is deemed necessary to provide on-site guidance.
(2) "Matters prescribed by Presidential Decree" in Article 166(2)3 of the Act means the following: <Amended on Mar. 23, 2013>
1. Correction of illegal or unjust acts;
2. Disposal of non-performing assets;
3. Improvement of human resources and organizational operation;
4. Other matters prescribed by the Minister of Agriculture, Food and Rural Affairs concerning the management of the cooperative, etc.
(3) Deleted. <Jan. 6, 2012>
[This Article Wholly Amended on Dec. 11, 2009]
Article 48(Period of management guidance) #
(1) The period of management guidance under Article 166 of the Act shall be 6 months.
(2) Where it is deemed necessary for protecting members of a cooperative, the Minister of Agriculture, Food and Rural Affairs may extend the period of management guidance by 6 months. <Amended on Mar. 23, 2013>
(3) Where the Minister of Agriculture, Food and Rural Affairs intends to extend the period of management guidance pursuant to paragraph (2), he or she shall notify the relevant cooperative of such fact in writing by not later than 15 days before the expiration of the management guidance period, specifying the grounds therefor. <Amended on Mar. 23, 2013>
[This Article Wholly Amended on Dec. 11, 2009]
Article 49(Notification of management guidance) #
Where management guidance is to be provided pursuant to Article 166(1) of the Act, the relevant cooperative, etc. shall be notified of the grounds for and period of such management guidance in writing.
[This Article Wholly Amended on Dec. 11, 2009]
Article 50(Suspension of payment of obligations) #
(1) The obligations, the payment of which may be suspended by the Financial Services Commission under Article 86(2) of the Act, shall not fall under any of the following: <Amended on Jul. 24, 2012; and Mar. 23, 2013>
1. Obligations to pay taxes, public dues, or rent;
2. Obligations to pay wages for the preceding 3 months and compensation for a disaster, the preferential payment right for which is granted pursuant to Article 38(2) of the Labor Standards Act, and obligations to pay retirement benefits for the preceding 3 years, the preferential payment right for which is granted pursuant to Article 12(2) of the Act on the Guarantee of Workers' Retirement Benefits;
3. Other obligations deemed necessary by the Financial Services Commission for the maintenance and management of cooperatives, etc.
(2) When the Minister of Agriculture, Food and Rural Affairs has fully withdrawn the suspension of payment of obligations against a cooperative, etc. pursuant to Article 166(6) of the Act, he or she shall terminate management guidance for the relevant cooperative, etc. without delay. <Amended on Mar. 23, 2013>
[This Article Wholly Amended on Dec. 11, 2009]
Article 50-2(Suspension of duties of executive officers) #
Where the Minister of Agriculture, Food and Rural Affairs intends to suspend the duties of an executive officer pursuant to Article 166(3) of the Act, he or she shall notify the person of the grounds and reasons therefor in writing.
[This Article Added on Feb. 23, 2015]
Article 51(Entrustment of supervisory authority) #
(1) Pursuant to Article 162(3) of the Act, the Minister of Agriculture, Food and Rural Affairs shall entrust the National Federation Chairperson with the following authority over cooperatives or federations that are members of the National Federation (hereafter referred to as "members of the National Federation" in this Article): <Amended on Mar. 23, 2013; Sep. 8, 2020>
1. Approval for business of cooperatives under Article 57(1)10 of the Act, subparagraph 10 of Article 106, and subparagraph 9 of Article 111 of the Act;
2. Supervision over administrative affairs related to liquidation under Article 84(3) of the Act (including cases applied mutatis mutandis in Articles 107 and 112 of the Act);
3. Request for measures against misconduct by employees of a member cooperative of the National Federation under Article 164(1) of the Act;
4. Audit of day-to-day business, among audits of members of the National Federation under Article 46(1), and necessary measures based on the results thereof.
(2) Pursuant to Article 162(3) of the Act, the Minister of Agriculture, Food and Rural Affairs shall entrust the National Federation Chairperson with the following authority over joint business corporations of cooperatives: <Added on Jan. 6, 2012; Mar. 23, 2013; Feb. 23, 2015; Jun. 30, 2015; Sep. 8, 2020>
1. Supervision over administrative affairs related to liquidation under Article 84(3) of the Act which shall apply mutatis mutandis in Article 112-11 of the Act;
2. Audit of the execution of a business plan and revenue and expenditure budget, among audits of joint business corporations of cooperatives under Article 162(1) of the Act and Article 46(1) of this Decree, and request for necessary measures based on the results thereof;
3. Making a request for measures against misconduct by employees of a joint business corporation of cooperatives under Article 164(1) of the Act;
4. Audit of day-to-day business, among audits of joint business corporations of cooperatives under Article 46(1), and necessary measures based on the results thereof.
(3) Pursuant to Article 166(7) of the Act, the Minister of Agriculture, Food and Rural Affairs shall entrust the National Federation Chairperson with management guidance under Article 166(1) of the Act. <Amended on Jan. 6, 2012; Mar. 23, 2013; Sep. 8, 2020>
[This Article Wholly Amended on Dec. 11, 2009]
[Title Amended on Sep. 8, 2020]
Article 51-2(Processing of personally identifiable information) #
(1) The Minister of Agriculture, Food and Rural Affairs (including persons to whom the authority of the Minister of Agriculture, Food and Rural Affairs is entrusted under Article 51) may manage data which contains resident registration numbers, passport numbers or alien registration numbers referred to in subparagraph 1, 2 or 4 Article 19 of the Enforcement Decree of the Personal Information Protection Act (hereafter referred to as "personally identifiable information" in this Article), if it is essential to perform administrative affairs regarding the following: <Amended on Sep. 8, 2020>
1. Supervision and inspection under Article 162(1) through (3) of the Act and measures taken accordingly;
2. Administrative dispositions and measures against executive officers and employees under Article 164 of the Act;
3. Management guidance under Article 166 of the Act and measures taken accordingly.
(2) The head of a local government may manage data including personally identifiable information where it is inevitable to conduct the administrative affairs related to supervision under Article 162(4) of the Act. <Added on Sep. 8, 2020>
(3) The Financial Services Commission may manage data including personally identifiable information where it is inevitable to conduct the administrative affairs related to supervision under Article 162(5) of the Act. <Amended on Sep. 8, 2020>
(4) The Governor of the Financial Supervisory Service may manage data including personally identifiable information where it is inevitable to conduct the administrative affairs related to the due diligence on property of a cooperative, etc. under the latter part of Article 166(3) and (4) of the Act and measures taken accordingly. <Amended on Sep. 8, 2020>
(5) The National Federation Chairperson, the chief executive officer of the NongHyup Agribusiness Group (limited to subparagraph 3) and the head of the NongHyup Bank (limited to subparagraph 7) may manage data including personally identifiable information where it is inevitable to conduct the administrative affairs regarding the following: <Amended on Jun. 27, 2017; Sep. 8, 2020>
1. Inspection and investigation of compliance with the internal control standards under Article 125-4(2) of the Act, and reporting thereon;
2. Audits of property and business execution status under Article 129(1) of the Act;
3. Operation of distribution support funds under Article 136(1) and (2) of the Act;
4. Supervision over subsidiaries of the National Federation under Article 142-2 of the Act;
5. Audits of members under Article 146 of the Act and measures taken accordingly;
6. Issuance and management of preferential investment under Article 147 of the Act;
7. Issuance and management of agricultural financial bonds under Article 153 of the Act;
8. Confirmation of grounds for disqualification under Article 49(1) of the Act which shall apply mutatis mutandis pursuant to Article 161 of the Act;
9. Inspection of cooperatives under Article 162(6) of the Act;
10. Due diligence on property of a cooperative, etc. under the latter part of Article 166(3) of the Act and paragraph (4) of that Article and measures taken accordingly.
(6) The president of a cooperative may manage data containing personally identifiable information where it is inevitable to perform the administrative affairs regarding the following. In such cases, subparagraphs 2, 3, 5 through 7, 11, and 12 shall include cases applied mutatis mutandis in Articles 107 and 112 of the Act: <Amended on Jun. 30, 2017; Sep. 8, 2020>
1. Membership of cooperatives under Articles 19, 105, and 110 of the Act;
2. Joining of a local agricultural cooperative and use of its business by associate members, and distribution of dividends for them under Articles 20 and 68(3) of the Act;
3. Investment, use of business and withdrawal of members, and refund of equity interests and distribution of surplus funds to members under Articles 21, 24(2), 29, 31, and 68(3) of the Act;
4. Issuance and management of preferential investment under Article 147 of the Act which shall apply mutatis mutandis pursuant to Article 21-2 of the Act;
5. Election and management of delegates under Article 42 of the Act;
6. Audits under Article 46(6) and (7) of the Act and reporting thereon;
7. Confirmation of grounds for disqualification of executive officers under Article 49(1) of the Act;
8. Safekeeping of securities, etc. under Article 57(1)3 f and subparagraph 3f of Article 106 of the Act;
9. Agency service for receipt and payment of utility bills, administrative fees, etc. under Article 57(1)3g and subparagraph 3g of Article 106 of the Act;
10. Agency service for sale of revenue stamps (limited to electronic revenue stamps for paper documents under Article 2(2)1 of the Revenue Stamp Act), lottery tickets, and gift certificates under Article 57(1)3h of the Act and subparagraph 3h of Article 106 of the Act;
11. Management of the use of business by non-members under Article 58 of the Act;
12. Operation of distribution support funds under Article 59(1) and (2) of the Act.
[This Article Added on Feb. 23, 2015]
[Previous Article 51-2 moved to Article 51-3 <Feb. 23, 2015>]
Article 51-3(Re-examination of regulation) #
The Minister of Agriculture, Food and Rural Affairs shall, every 3 years (referring to the period before January 1 of every third year), review the validity of the matters in the following subparagraphs based on the respective base dates specified therein, and shall take measures for improvement, etc.: <Amended on Feb. 23, 2015; Dec. 30, 2016; Dec. 26, 2017; Apr. 12, 2022; Mar. 24, 2026>
1. Standards for authorization for establishment of a cooperative under Article 2: January 1, 2017;
2. Qualification of a member of a local agricultural cooperative under Article 4: January 1, 2017;
3. Standards for a cooperative required to have a non-member director under Article 4-4: January 1, 2017;
4. Standards for a cooperative required to have a standing director under Article 4-5: January 1, 2017;
5. Deleted; <Mar. 24, 2026>
6. Deleted; <Mar. 24, 2026>
7. Deleted; <Mar. 24, 2026>
8. Standards for a cooperative subject to audit by external auditor under Article 8-2: January 1, 2017;
9. Financial institutions subject to deposit of surplus funds of a cooperative under Article 9 and securities subject to purchase: January 1, 2017;
10. Standards and procedures for authorization for establishment of a joint business corporation of cooperatives under Article 11-2: January 1, 2017;
11. Deleted; <Mar. 24, 2026>
12. Standards for exercising voting rights at a general meeting of the National Federation under Article 11-4: January 1, 2017;
13. Deleted; <Mar. 24, 2026>
14. Qualification requirements for a chief mutual finance officer and a managing director of the National Federation under Article 12: January 1, 2017;
15. Deleted; <Mar. 24, 2026>
16. Deleted; <Dec. 30, 2016>
17. Methods of operation and management of surplus funds of members under Article 15: January 1, 2017;
18. Methods of operation and management of reserves for repayment to members under Article 15-2: January 1, 2017;
19. Qualification requirements for the chairperson and members of the audit committee for cooperatives under Article 22: January 1, 2017;
20. Deleted; <Mar. 24, 2026>
21. Deleted; <Mar. 3, 2020>
22. Deleted; <Dec. 30, 2016>
23. Deleted; <Dec. 30, 2016>
24. Deleted; <Dec. 30, 2016>
25. Deleted; <Dec. 30, 2016>
26. Deleted; <Dec. 30, 2016>
27. Deleted; <Dec. 30, 2016>
28. Deleted; <Dec. 30, 2016>
29. Deleted; <Mar. 24, 2026>
30. Deleted; <Mar. 24, 2026>
31. Deleted. <Mar. 3, 2020>
[This Article Added on Dec. 30, 2013]
[Moved from Article 51-2 <Feb. 23, 2015>]
Article 52(Standards for imposition of administrative fines) #
(1) The standards for imposing administrative fines under Article 174(1) and (2) of the Act shall be as specified in Appendix 5.
(2) Article 34(3) and (4) and Appendix 2 of the Rules on Elections Entrusted by Public Organizations shall apply mutatis mutandis to the standards for imposing administrative fines under Article 174(4) of the Act.
[This Article Wholly Amended on Feb. 23, 2015]