Press Releases - Financial Services Commission

Press Releases

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Aug 16, 2023

FSC Announces Private-Public Joint Export Support Measures Worth KRW23 Trillion

The Financial Services Commission held a meeting with major banks, policy financial institutions along with the relevant government ministries on August 16 and announced a set of measures aimed at boosting support for the export industry. The announcement is a follow-up to the presidential export strategy meeting held in February, and the measures reflect opinions raised during FSCs meeting with the export sectors held earlier in May. Key details of the measures include (a) proving strategic support for domestic export businesses to more effectively prepare them for the rapidly changing global trade structure, (b) strengthening the medium- to long-term competitiveness of the strategic export sectors by expanding the size of export finance and (c) reducing the burden of using trade finance for some 2,500 outstanding export businesses selected by the government. Providing strategic support for domestic export businesses First, for exporters seeking to find a new export market or businesses seeking to explore export opportunities in partnership with a large exporter, special financial products worth KRW4.1 trillion-plus will be provided with the availability of interest rate reduction of maximum KRW1.5 percentage points and benefits for guarantee fees and maximum lending limit. To help domestic enterprises to win large-scale oversees project orders, policy financial institutions will each play a role in setting up a project package financing model in which private financial institutions can also participate. At the same time, a KRW500 billion worth of fund will be created to more effectively respond to the shifting global supply chain environment. The fund will provide support for the materials, parts and equipment businesses and provide funds needed to expand their business operation in export destinations or set up new production facilities in another country. Strengthening the medium- to long-term competitiveness of strategic export sectors Policy finance support wo
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Aug 16, 2023

Regulatory Change Proposed Postponing External Audit on Consolidated Internal Accounting Control

The Financial Services Commission issued a notice of legislative change (a revision bill of the Enforcement Decree of the Act on External Audit of Stock Companies) as a follow-up to the previously announced (June 12) plan to make improvements to the accounting regulations. The revision bill contains a provision postponing the requirement of external audit on the consolidated internal accounting control system for small- and medium-sized stock companies (those with assets less than KRW2 trillion) for five years until 2029. For stock companies with assets worth KRW2 trillion or more, the external audit requirement will be enforced as scheduled starting from this year, but those applying for postponement can get a maximum two-year postponement after having a review conducted by the authorities. Those wishing to apply for a postponement should submit applications within the application period (from September 1 to 8). The Securities and Futures Commission (SFC) will then review applications submitted by qualified businesses only and decide whether to grant postponement at a regularly scheduled meeting in November. The companies that have been granted postponement will need to disclose this and the reason for postponement in their business reports. This revision bill will be put up for public comment between August 16 and September 25, while the authorities seek to implement the revision starting from January 2024. * Please refer to the attached file for details.
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Aug 14, 2023

Government Approves Partial Revision Bill of the Enforcement Decree of the Banking Act

The Financial Services Commission announced that a partial revision bill of the Enforcement Decree of the Banking Act was approved by the government at a cabinet meeting held on August 14. This partial revision bill has been prepared to specify the details pertaining to the implementation of the revised Banking Act, which is scheduled to take effect from September 22. First, the partial revision bill of the Enforcement Decree of the Banking Act establishes a specific standard for when a bank should get authorization from the FSC if it chooses to close down or transfers or acquires a major part of its business operation. The major part of a banks business operation is determined as a part of business constituting 10/100 or more of the banks total assets or operating profits. In addition, considering that the transfer of a part of a business is in essence same as the closure of a part of a business, under this partial revision bill, banks are subject to get FSCs authorization when transferring a major part of a business constituting 10/100 or more of the banks total assets or operating profits. For the acquisition of banking business, on top of the aforementioned standard of assets and operating profits, the partial revision bill will subject banks to get FSCs authorization when the amount of debt acquiring is 10/100 or more of the acquiring enterprises total debt. The partial revision bill also contains a provision that specifically sets the minimum amount (KRW10 billion) for loans and payment guarantees extended by an enterprise to a bank for which the bank is required to report at its general shareholders meeting about certain criteria such as the status of the enterprise whose debt has been restructured in a given fiscal year and the details concerning its debt restructuring history. For failure to comply with this reporting duty, the partial revision bill specifically sets the maximum amount of administrative fine that can be imposed on a bank as up to KRW30 mill
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Aug 09, 2023

Household Loans, July 2023

The outstanding balance of household loans across all financial sectors rose KRW5.4 trillion in July 2023 (preliminary), going up for the fourth consecutive month. Compared to the same month last year, household loans dropped 0.8 percent. * Change (in trillion KRW): -8.1 (Jan 2023), -5.1 (Feb), -5.1 (Mar), +0.2 (Apr), +2.8 (May), +3.5 (Jun), +5.4 (Jul) (By Type) Home-backed mortgage loans grew at a slower pace but the pace of decline in other types of loans also slowed. Mortgage loans rose KRW5.6 trillion, despite a decline of KRW0.4 trillion in the nonbanking sector, as banks saw a rise of KRW6.0 trillion. Other types of loans fell KRW0.2 trillion as both banks and nonbanks saw drops of KRW0.01 trillion and KRW0.2 trillion, respectively. (By Sector) Household loans rose in the banking sector but declined in the nonbanking sector. Banks saw a rise of KRW6.0 trillion of household loans in July, which went up for the fourth straight month. Home mortgage loans went up KRW6.0 trillion in the banking sector as individual mortgage loans (up KRW3.9 trillion) and policy mortgage loans (up KRW2.4 trillion) increased. Jeonse loans (down KRW0.2 trillion) and group lending for new apartment subscription (down KRW0.1 trillion) declined. Other types of loans fell KRW0.01 trillion in the banking sector. Household loans in the nonbanking sector declined KRW0.6 trillion due to a drop of KRW1.6 trillion in the mutual finance sector, although insurance companies (up KRW0.5 trillion), savings banks (up KRW0.1 trillion) and specialized credit finance businesses (up KRW0.5 trillion) saw growths. As the growth of household loans has been picking up since April with the volume of housing transactions recovering recently, the financial authorities will closely monitor trends in household loans and work to prepare preemptive measures to stably manage the growth of household loans. * Please refer to the attached file for details.
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Jul 27, 2023

KoFIU Holds Meeting on Strengthening Compliance Capacity of VASPs

The Korea Financial Intelligence Unit (KoFIU) held a consultative body meeting on strengthening the compliance capacity of virtual asset service providers (VASPs) on July 27 along with the joint virtual asset crime investigation unit launched a day before and major VASPs. The meeting was held to ensure strong coordination and cooperation with the newly launched joint virtual asset crime investigation unit, bolster response to illegal activities and support VASPs to enhance their compliance capacity. Speaking at the meeting about the need to strengthen government-wide collective response, KoFIU Commissioner Rhee Yunsu said that although the KoFIU has been carrying out its oversight functions mainly within the framework of anti-money laundering efforts, we will operate a strategic analysis team on virtual assets to more systematically analyze criminal activities involving virtual assets so that we can provide more meaningful and valuable data to the investigative authorities. The consultative body meeting on compliance capacity of VASPs will be held regularly every two or three months to ensure mutual communication. * Please refer to the attached file for details.
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Jul 27, 2023

Authorities Propose Measures to Improve Special Listing Procedures for High-tech Companies

The Financial Services Commission held a meeting with the relevant government ministries and private sector entities on July 27 and unveiled a plan to improve the special listing procedures for technology companies. The plan includes 14 specific reform items from the stage of listing application to listing review to post-listing management. First, in the listing application stage, a new super gap tech listing track will be created for high-tech and strategically critical technology companies, for instance in deep tech or deep science sectors. Among them, businesses that are market-tested for their growth potential will be allowed to have a tech assessment conducted only by a single entity. They need to be designated as national strategic technology companies or national advanced strategic technology companies as prescribed by the relevant laws, have market capitalization of KRW100 billion or more and have received investment of KRW10 billion or more in the past five years. In addition, a business eligible to apply for the super gap tech listing track will be allowed to seek a special tech listing track even when its largest investor is a middle market enterprise, considering wide adoption of open innovation business models based on collaboration between an SME and a middle market enterprise. However, the size of investment by a middle market enterprise will be limited to less than fifty percent to prevent potential problems regarding the ownership of the company. Also, the complex structure of the current special tech listing track will be made simpler and more reasonable. For instance, businesses with technological prowess will be able to apply through innovative technology track, while those with distinctive business models can apply through business model track. Second, in the listing review stage, a fast-track review process will be granted to those that have been turned down previously for reasons other than their technology or business viability. In this case,
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Jul 26, 2023

Housing Loan Rules Temporarily Eased to Facilitate Landlords to Return Rent Deposits

The government announced that the housing loan regulations applied on landlords who are using bank loans (excluding internet-only banks) to return rent deposits to their current tenants will be temporarily eased for one year from July 27, 2023 until July 31, 2024. Under this scheme, landlords will be able to obtain bank loans for the difference between the previous and current jeonseprice of their property. Instead of the 40 percent debt service ratio (DSR) currently in place, a 60 percent debt to income (DTI) ratio will be applied, while the rent to interest(RTI) ratio will be lowered from 1.25 to 1.5 times currently to 1.0 times. With unexpected declines in jeonse prices recently, the measures intend to support tenants to move out on schedule by addressing the problem of a delay in collection of rent deposits or worries about the risk of not being able to receive their rent deposits. When there is no subsequent occupant from whom the landlord can get rent deposit to pay the current tenant immediately, this program allows landlords to use bank loans up to the limit of the eased DTI and RTI ratios. In this case, the landlord will need to fill vacancy and get a subsequent tenant within one year to repay the loan. Declining jeonse prices can cause problems as tenants experience difficulties in receiving their rent deposits back and moving to new places. Therefore, the eased lending rules being applied temporarily for one year are intended to minimize market shock. In order to prevent a potential increase in household debt and to minimize the risk of rent deposits not being returned to subsequent tenants, the government will ensure that the landlords financial capacity to return deposits is thoroughly assessed and that sufficient safeguards are prepared for tenants. The eased lending rules will be implemented through an administrative guidance (July 27). Revision to the regulation on the supervision of banking business will also be completed soon in August. * Please re
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Jul 25, 2023

Government Approves Revised Rules to Improve Financial Dispute Mediation Procedures

The Financial Services Commission announced that a revision bill of the Enforcement Decree of the Act on the Protection of Financial Consumers, which contains measures to improve the financial dispute mediation procedures, has been approved by the government during a cabinet meeting held on July 25. With financial products becoming increasingly diversified and complex in their type and structure, the number of disputes between financial consumers and financial companies has also increased. Due to the increased volume of dispute cases (28,118 in 2018 to 36,508 in 2022, based on the number of registered complaints), the time it takes to process mediations has also increased, causing inconvenience to consumers. Against this backdrop, the revision aims to enhance the speediness and independence of the financial dispute mediation procedures. First, a fast-track mediation process will be newly introduced, allowing cases to move onto the final stage of mediation committee without having to go through the settlement recommendation stage. Whether a case gets fast-tracked will be determined depending on the mediation amount in question and the extent of stakeholders involved. Second, additional standards have been introduced regarding the method of designating members of financial dispute mediation committee to enhance the level of independence in the operation of mediation committees and ensure fairness in how committee members are selected. The revision also includes some other improvement measures that have been brought up by FSCs ombudsman. The revised measures are scheduled to be publicly announced on August 1 and become effective after three months (November 2) from the day of announcement. * Please refer to the attached file for details.
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Jul 20, 2023

KoFIU Announces Measures to Strengthen Responsibility and Professional Capacity in AML Duties

The Korea Financial Intelligence Unit (KoFIU) held a meeting with financial industry groups on July 20 and introduced measures to strengthen responsibility and professional capacity in financial institutions anti-money laundering (AML) duties. The measures have been prepared after having numerous discussions and gathering comments from financial institutions throughout the first half of this year. First, the proposed measures make the role and responsibility of core AML officers (board of directors, chief executive officer, compliance officer and reporting officer) more reasonable to ensure that their AML duties are performed effectively commensurate with their respective position and responsibility. The role of CEOs has been made more specific to clearly indicate what types of activities constitute the establishment and operation of a company-wide AML system. Under the current legal framework, there is no specific indication about the role and responsibility of compliance officers regarding their AML activities. Therefore, the measures introduce a supervisory role on compliance officers over their employees. The measures also adjust the reporting officers scope of responsibilities more realistically so that they can be made accountable for the areas that can actually come under their supervision. Second, the proposed measures strengthen the professional capacity and independence of the reporting officer who is in charge of overseeing the companys AML activities. Financial institutions will need to appoint someone who has at least two years of AML experience. However, considering that there is currently a shortage of AML experts in the market vis--vis the number of financial institutions that are required to comply with AML duties, this requirement will apply only to the financial institutions that are legally bound to have a compliance officer as mandated by the Act on Corporate Governance of Financial Companies (the Act hereinafter). A grace period of two years an
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Jul 19, 2023

FSC Grants Preliminary Approval to Nextrade for Operating Alternative Trading System

The Financial Services Commission decided to grant a preliminary approval to Nextrade Co., Ltd. to operate an alternative trading system (ATS) at the 14th regular meeting held on July 19. The financial authorities have been seeking to introduce ATS platforms to enhance competition between exchanges and promote innovation in capital markets, and this is the first time that authorities are granting a preliminary approval since the legal framework on ATS was first established in 2013. After a review, the FSC found that Nextrade Co., Ltd. met all licensing requirements specified by the Financial Investment Services and Capital Markets Act (FSCMA) and an external review committee also approved the companys qualifications to operate an ATS. Considering the time it is expected to take for preparing a stable network system, Nextrade Co., Ltd. will be given eighteen months from the day of preliminary approval to apply for final authorization. * Please refer to the attached file for details.
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Jul 19, 2023

FSC Designates Eight More Data Specializing Institutions to Promote Big Data Analytics

The Financial Services Commission held the 14th regular meeting on July 19 and designated eight additional data specializing institutions (BC Card, Samsung SDS, Samsung Card, Shinhan Bank, Shinhan Card, LG CNS, Coocon, and Statistics Korea), bringing the total number of data specializing institutions to twelve. Data specializing institutions provide data convergence service on behalf of businesses when they develop new business strategies or services and evaluate the appropriateness of the pseudonymized data. In order to ensure the safety and efficiency of big data usage in financial sectors, data specializing institutions have been designated by the FSC since 2020 pursuant to the Credit Information Use and Protection Act. Since 2020, business demand for data convergence particularly between the financial and non-financial sectors has continued to increase. To ensure fairness, transparency and objectivity in data convergence, the seven newly designated data specializing institutions from the private sector other than Statistics Korea will be required to provide 50 percent or more of their data convergence services to non-affiliated external entities. With the addition of eight more data specializing institutions, it is expected that data convergence between different sectors as well as opening up of more private sector data will be promoted. * Please refer to the attached file for details.
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Jul 17, 2023

Authorities to Ease Rules on Overseas Subsidiary Ownership of Financial Companies

The financial regulatory reform committee held its 8th meeting on July 17. At the meeting, participants discussed (a) measures to ease rules on domestic financial companies ownership of subsidiaries in overseas markets, (b) ways to improve licensing standards on mergers between savings banks and (c) recent progress in the implementation of financial regulatory reform agendas sought by the committee. With regard to the measures to ease rules on financial companies ownership of subsidiaries in overseas markets, the proposed measures will first ease rules on domestic banks, insurance companies, specialized credit finance companies and fintech businesses making investment in foreign financial and non-financial companies within the scope of regulatory boundaries exhibited in overseas markets. For instance, a specialized credit finance business specializing in auto finance products may be able to acquire a rental car business in an overseas market to expand its sales operation. An insurance company will be able to own a foreign bank operating in an overseas market. A fintech business belonging to a domestic financial holding company can acquire an investment advisory or investment consulting business as a subsidiary. As many financial companies have been making requests to ease regulations regarding their foreign subsidiary holdings, it is expected that business diversification driven by local demand will help boost their competitiveness in overseas markets. Second, the proposed measures will ease rules on the maximum level of credit extension allowed for foreign subsidiaries. Through a revision to the supervisory regulations on financial holding companies, authorities plan to increase the maximum level of credit (within 10%p) that can be extended by a financial company to its foreign subsidiary for certain period of time (i.e. for first three years). Third, for the rules that have been set up for domestic environment and are thus not quite suitable to be applied on forei
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Jul 12, 2023

Household Loans, June 2023

The outstanding balance of household loans across all financial sectors went up KRW3.5 trillion in June 2023 (preliminary), rising for the third consecutive month. Compared to the same month last year, household loans fell 1.2 percent. * Change (in trillion KRW): -3.4 (Dec 2022), -8.1 (Jan 2023), -5.1 (Feb), -5.1 (Mar), +0.2 (Apr), +2.8 (May), +3.5 (Jun) (By Type) Home-backed mortgage loans edged up for four months in a row but other types of loans declined at a faster pace in June. Mortgage loans rose KRW6.4 trillion, with a drop of KRW0.6 trillion in the nonbanking sector and an increase of KRW7.0 trillion in the banking sector. Other types of loans fell KRW2.9 trillion as both banks and nonbanks saw drops of KRW1.1 trillion and KRW1.8 trillion, respectively. (By Sector) Household loans rose in the banking sector but declined in the nonbanking sector. Banks saw a rise of KRW5.9 trillion of household loans in June, which went up for the third straight month. Home mortgage loans went up KRW7.0 trillion in the banking sector as individual mortgage loans (up KRW3.7 trillion), policy mortgage loans (up KRW2.6 trillion), jeonse loans (up KRW0.1 trillion) and group lending for new apartment subscription (up KRW0.7 trillion) all increased. Other types of loans fell KRW1.1 trillion due to a drop in credit loans (down KRW0.9 trillion). The growth of mortgage loans in the banking sector seems to be caused by rising supply of special Bogeumjari Loan for non-speculative homebuyers and housing transactions rebounding in certain areas. However, as the volume of housing transactions is yet to bounce back to the level seen in previous years and with a significant number of mortgage borrowers taking out loans to return jeonse deposit money or for living expenses, the current pace of growth in home mortgage loans is not at an alarming level as to cause overheated speculation in the housing market. Nonbanks saw a drop of KRW2.4 trillion in household loans with a slight increase in th
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Jul 06, 2023

FSC Approves Recovery and Resolution Plans for D-SIFIs

The Financial Services Commission announced on July 6 that it has approved the recovery plans prepared by D-SIFIs (2023) and their resolution plans drawn up by the Korea Deposit Insurance Corporation as recommended by the Financial Stability Board. The FSC found that the recovery and resolution plans on ten D-SIFIs selected for 2023Shinhan, KB, KEB Hana, Woori and NongHyup financial holding companies and their banksmostly meet international standards including recommendations of the FSB. Compared to the previous year, the recovery and resolution plans approved by the FSC this year carry tools and mechanisms enabling large financial companies to more preemptively respond to risk situations and allow authorities to more swiftly carry out resolution proceedings, thereby helping to ensure stability in the financial system more thoroughly. The recovery and resolution plans are operated on a yearly basis and the authorities plan to review and approve the recovery and resolution plans for D-SIFIs selected for 2024 in the future. * Please refer to the attached file for details.
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Jul 05, 2023

FSC Announces Designation of Seven Non-Holding Financial Groups for 2023

The Financial Services Commission held the 13th regular meeting on July 5 and designated seven non-holding financial groups for 2023 pursuant to the Act on the Supervision of Financial Conglomerates. The designated entities are Samsung, Hanwha, Kyobo, Mirae Asset, Hyundai Motor, DB and Daou Kiwoom groups. This is the third time the FSC is designating non-holding financial groups (financial conglomerates) since the Act on the Supervision of Financial Conglomerates became effective in June 2021. The seven entities satisfied all designation criteria. The seven non-holding financial groups will be subject to the following rules. a) Select a financial business entity representing the entire group after considering the investment relationship, total size of asset, capital, etc. and report their selection to the Financial Supervisory Service. b) Periodically inspect and evaluate group-wide risks and prepare and follow their own internal control and risk management policy, and transparently disclose material information needed to ensure consumer protection and report to authorities. c) Draw up capital adequacy ratio reflecting risk-weighted capital based on the risk assessment conducted by financial authorities. d) Financial authorities will carry out a periodic assessment (every three years) on the risk and risk management status of non-holding financial groups. Authorities expect that the designation will help the non-holding financial groups to more effectively monitor and manage their group-wide risks on their own. * Please refer to the attached file for details.
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Jul 05, 2023

FSC Identifies D-SIBs and D-SIFIs for 2024

The Financial Services Commission identified five bank holding companies (BHCs) and five banks as domestic systemically important banks (D-SIBs) for 2024 on July 5: KB Financial Group, Shinhan Financial Group, Hana Financial Group, Woori Financial Group, NH Financial Group, KB Kookmin Bank, Shinhan Bank, Woori Bank, KEB Hana Bank and NH Bank. Those identified as D-SIBs are required to set aside an additional common equity capital of 1.0%, and the higher loss absorbency requirement will take effect on January 1, 2024. The FSC identifies D-SIBs every year in accordance with assessment criteria recommended by the Basel Committee on Banking Supervision (BCBS). Meanwhile, the FSC also identifies D-SIBs as domestic systemically important financial institutions (D-SIFIs) under the amended Act on the Structural Improvement of the Financial Industry. D-SIFIs are required to prepare and submit their own recovery plans to the Financial Supervisory Service (FSS) within three months from the day of being designated as a D-SIFI. * Please refer to the attached file for details.
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Jul 05, 2023

Financial Authorities to Promote Fair and Effective Competition in Banking Sector

The Financial Services Commission and the Financial Supervisory Service held a meeting with bank holding companies on July 5 and announced a set of measures intended to promote competition in the banking sector. The measures have been prepared after holding a series of taskforce meetings on improving the management and operating practices of banks since February this year. The key banking sector reform areas include (a) promoting competition and overhauling the industrial structure, (b) improving the interest rate system through expanded availability of fixed interest rates, (c) enhancing loss absorbing capacity, (d) increasing the proportion of non-interest revenues, (e) improving the employee remuneration system and the shareholder return policy and (f) promoting corporate social responsibility. At the beginning of the meeting, FSC Chairman Kim Joo-hyun delivered opening remarks emphasizing the need to promote fair and effective competition in the banking sector. The following is a summary of Chairman Kims remarks. Over the past four months since the end of February, the FSC and the FSS have been preparing reform measures together with private sector experts, financial industry officials and research institutions on the six key task items concerning how to improve the management and operating practices of banks. Due to the oligopolistic nature of the banking industry, there has been a widely held view among the public that banks are reluctant to make changes despite their easy profitmaking structure. Therefore, the main purpose of the reform measures prepared by the taskforce is to promote fair and effective competition in the banking sectorbut more importantly, competition driven by market forces. Authorities will work to bring about fair competition by requiring banks to provide adequate information about their business operation and products to the market so that consumers can make inform decisions. The purpose of creating an online loan transfer system introdu
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Jun 30, 2023

Revised FSCMA Strengthens Penalties on Unfair Trading Activities

The Financial Services Commission announced that a revision bill of the Financial Investment Services and Capital Markets Act (FSCMA) containing measures to strengthen penalties on unfair trading activities in capital markets was passed at the National Assemblys plenary session on June 30. The revised FSCMA creates legal grounds to impose penalty surcharge, introduce a method for calculating unfairly gained profits and grant leniency to those who report their wrongdoing voluntarily. It aims to overhaul the entire penalty system concerning unfair trading activities in capital markets from detection and prevention of stock price manipulation to administrative sanction to criminal punishment. First, the revised FSCMA establishes a provision on penalty surcharge of up to twice the amount of illegally earned profits (unfair gains), with the maximum penalty amount set at KRW4 billion when there is no unfairly gained profit or it is deemed unfeasible to calculate it. Until now, unfair trading activities in capital markets were punishable only through criminal penalties, taking a long time (two to three years) to bring penalties to the wrongdoer and lacking effectiveness in sanctions. In this regard, with the creation of penalty surcharge, economic sanctions on unfair trading activities can take place in a more swift and effective manner. Second, the revised FSCMA introduces a clear standard for calculating unfairly gained profits (total profit minus total cost generated by engaging in illicit activities). This will help ensure that the level of punishment is commensurate with the level of economic gain. Third, the revised FSCMA contains a leniency clause which makes it possible for those reporting their own wrongdoing voluntarily or testifying on others illicit activities to receive a reduction in criminal punishment or penalty surcharge. This leniency offered to whistle-blowers will help prevent and detect unfair transaction activities more effectively. The revised FSCMA
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Jun 30, 2023

Government to Ensure Virtual Asset User Protection, Transaction Transparency and Market Discipline

The Financial Services Commission announced that the Act on the Protection of Virtual Asset Users (the Act hereinafter) was passed at the National Assemblys plenary session on June 30. The newly established law on virtual assets is aimed at guaranteeing protection of assets held by virtual asset users, regulating unfair transaction activities in the virtual asset market and conferring the market oversight and sanctions authority to the FSC. Virtual asset service providers have been regulated under the revised Act on Reporting and Using Specified Financial Transaction Information since March 2021. However, the current regulatory framework had limits where authorities are not able to actively respond to various types of unfair transaction activities, prevent damages incurred to the users of virtual assets and more effectively supervise and sanction VASPs and assist victims with relief measures. Since the onset of this administration, the government has put forward establishing the infrastructure and regulatory framework on digital assets as a key policy agenda and has been supporting the relevant legislative process at the National Assembly. In August 2022, a private-public joint taskforce on digital assets was launched which established the following principles on the direction of creating a virtual asset regulatory framework(a) working on a gradual and phase-by-phase introduction of regulations, (b) applying same regulations on the same service and same risk and (c) ensuring global regulatory consistency with major economies and international organizations. On April 25 this year, given the urgency of protecting virtual asset users, the legislative subcommittee of the National Policy Committee at the National Assembly decided to go ahead with an enactment of the least necessary regulatory measures. Then, a legislative bill integrating nineteen previously pending bills was prepared and passed at the plenary session of the National Assembly on June 30. First, the Act e
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Jun 27, 2023

Campaign to Return KRW12.4 Trillion in Unclaimed Insurance Money to Begin in September

The Financial Services Commission along with the insurance industry returned about KRW3.9 trillion in unclaimed insurance money to their policyholders in 2022 and plan to send out postal mail in September to inform relevant policyholders about KRW12.4 trillion in unclaimed insurance money still remaining. This campaign to return unclaimed insurance money has been in place since 2017 and over the past five years more than KRW16.8 trillion worth of dormant insurance money has been returned to the policyholders (KRW3.85 trillion in 2022). Meanwhile, the FSC, the insurance sector and the Korea Inclusive Finance Agency (KINFA) plan to shorten the period for transferring dormant insurance money to KINFA by about one year starting from 2024. Insurance companies transfer dormant insurance money to KINFA pursuant to the Microfinance Support Act as a form of contribution. Therefore, for insurance companies, the period to make this transfer of dormant insurance money occurring within this year will be reduced from February the year after next year (2025) to May (expected) next year (2024). Once transferred to KINFA, dormant insurance money can be traced and retrieved along with other types of dormant financial assets on KINFAs mobile app or website. * Please refer to the attached file for details.
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