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11Nov/21

Act nº 7929, Apr. 28, 2006, Electronic Financial Transactions Act

Act nº 7929, Apr. 28, 2006, Electronic Financial Transactions Act. (Amended by Act nº 8387, Apr. 27, 2007, Act nº 8863, Feb. 29, 2008, Act nº 9325, Dec. 31, 2008, Act nº 10303, May 17, 2010, Act nº 11087, Nov. 14, 2011, Act nº 11407, Mar. 21, 2012, Act nº 11461, jun. 1, 2012, Act nº 11814, May 22, 2013, Act nº 12837, Oct. 15, 2014, Act nº 13929, Jan. 27, 2016, Act nº 14132, Mar. 29, 2016, Act nº 14828, Apr. 18, 2017, Act nº 14839, Jul. 26, 2017).

ELECTRONIC FINANCIAL TRANSACTIONS ACT

CHAPTER I.- GENERAL PROVISIONS

Article 1 (Purpose)

The purpose of this Act is to ensure the safety and reliability of electronic financial transactions by clarifying their legal relations and to promote financial conveniences for people and contribute to national economic development by creating a foundation for the sound development of the electronic financial industry.

Article 2 (Definitions)

The definitions of terms used in this Act shall be as follows: (Amended by Act nº 8387, Apr. 27, 2007; Act nº 8863; Feb. 29, 2008; Act nº 11407, Mar. 21, 2012; Act nº 11461, Jun. 1, 2012; Act nº 11814, May 22, 2013)

1. The term “electronic financial transaction” means any transaction whereby a financial company or an electronic financial business entity provides financial products and services through electronic apparatus (hereinafter referred to as “electronic financial business“) and users use them in a non-facing and automated manner without any direct contact with employees of the financial company or electronic financial business entity;

2. The term “electronic payment transaction” means any electronic financial transaction whereby a person providing a payment (hereinafter referred to as “payer“) requires a financial company or an electronic financial business entity to transfer money to another person receiving the payment (hereinafter referred to as “payee“) by electronic payment means;

3. The term “financial company” means any of the following institutions, organizations or business entities:

(a) An institution referred to in subparagraphs 1 through 5, 7 and 8 of Article 38 of the Act on the Establishment, etc. of Financial Services Commission;

(b) A specialized credit financial company established under the Specialized Credit Finance Business Act;

(c) A postal service agency under the Postal Savings and Insurance Act;

(d) A community credit cooperative and Korean Federation of Community Credit Cooperatives established under the Community Credit Cooperatives Act;

(e) Any other person prescribed by Presidential Decree, which is an institution, organization, or a business entity carrying on financial business and other finance-related business pursuant to Acts;

4. The term “electronic financial business entity” means any person who has obtained permission or whose business has been registered (excluding any financial company) pursuant to Article 28;

5. The term “subsidiary electronic financial business entity” means any person prescribed by the Financial Services Commission established under Article 3 of the Act on the Establishment, etc. of Financial Services Commission (hereinafter referred to as the “Financial Services Commission“), who assists in electronic financial transactions; or vicariously performs the part of such transactions for a financial company or an electronic financial business entity; or who operates a payment gateway system;

6. The term “payment gateway system” means any financial data processing system that deals with business affairs relating to the settlement of accounts and payments by transmitting electronic financial transaction information between a financial company and an electronic financial business entity;

7. The term “user” means any person who conducts an electronic financial transaction under a contract concluded with a financial company or an electronic financial business entity for facilitating electronic financial transactions (hereinafter referred to as “electronic financial transaction contract“);

8. The term “electronic apparatus” means any apparatus used to transmit or process electronic financial transaction information by electronic means, such as a cash dispenser, automatic teller machine, debit terminal, computer, telephone, or other devices that transmit or process information by electronic means;

9. The term “electronic document” means any information prepared, transmitted, received or stored pursuant to subparagraph 1 of Article 2 of the Framework Act on Electronic Documents and Transactions;

10. The term “means of access” means any of the following means or information which is used to issue a transaction request in electronic financial transactions or to secure the authenticity and accuracy of users and the details of such transaction:

(a) An electronic card or other electronic information equivalent thereto;

(b) An electronic signature creating key defined in subparagraph 4 of Article 2 of the Digital Signature Act and a certificate referred to in subparagraph 7 of the said Article;

(c) A user number registered with a financial company or an electronic financial business entity;

(d) Biological information of users;

(e) A password required to use the means or information referred to in item (a) or (b);

11. The term “electronic payment means” means an electronic funds transfer, electronic debit payment means, electronic prepayment means, electronic currency, a credit card, an electronic bond or other means of payment by electronic means;

12. The term “electronic funds transfer” means any transfer of funds by any of the following methods from an account opened with a financial company or an electronic financial business entity (limited to any account linked to a financial company; hereinafter the same shall apply) to another account through electronic apparatus for the purpose of transferring funds between a payer and a payee:

(a) A payment request made by a payer to a financial company or an electronic financial business entity;

(b) A collection request made by a payee (hereinafter referred to as “collection transfer“) to a financial company or an electronic financial business entity;

13. The term “electronic debit payment means” means any certificate (excluding any certificate available for loans), or information on such certificate, issued by a financial company or an electronic financial business entity to simultaneously supply goods or services and pay their prices by the method of transferring funds from the account of a financial company between a user and a chain store by electronic means;

14. The term “electronic prepayment means” means any certificate, or information on such certificate, issued with transferable monetary values stored by electronic means, which meets all of the following requirements: Provided, That this shall not include any electronic currency:

(a) It shall be used to purchase goods or services from a third person other than the issuer (including specially related persons prescribed by Presidential Decree) and pay their prices;

(b) It shall be able to purchase goods or services in at least two business categories (referring to mid-classification business categories in the Korean Standard Industrial Classification publicly announced by the Commissioner of the National Statistical Office pursuant to Article 22 (1) of the Statistics Act; hereafter the same shall apply in this Article);

15. The term “electronic currency” means any certificate, or information on such certificate, issued with transferable monetary values stored by electronic means, which meets all of the following requirements:

(a) It shall be used in the areas and chain stores which meet the standards prescribed by Presidential Decree;

(b) It shall meet the requirements referred to in subparagraph 14 (a);

(c) It shall be able to purchase goods or services in at least five business categories and the number of such business categories shall be at least that prescribed by Presidential Decree;

(d) It shall be issued in exchange for the same value of cash or deposits;

(e) It shall be exchangeable for cash or deposits under guarantee of the issuer;

16. The term “electronic bond” means any creditor’s monetary claims stated in an electronic document, which meets the following requirements:

(a) The debtor shall designate the creditor;

(b) It shall include the contents of debts;

(c) It shall include the certified digital signature defined in subparagraph 3 of Article 2 of the Digital Signature Act;

(d) It shall be registered with an electronic bond management agency under Article 29 (1) (hereinafter referred to as “electronic bond management agency“) via a financial company;

(e) The debtor shall transmit an electronic document which meets all requirements referred to in items (a) through (c) to the creditor pursuant to Article 6 (1) of the Framework Act on Electronic Documents and Transactions and the creditor shall receive it in accordance with Article 6 (2) of the said Act;

17. The term “transaction request” means any request whereby a user asks a financial company or an electronic financial business entity to process electronic financial transactions pursuant to the electronic financial transaction contract;

18. The term “error” means any case where an electronic financial transaction fails to be made pursuant to the electronic financial transaction contract or the user’s transaction request neither intentionally nor with negligence;

19. The term “electronic payment settlement agency service” means any service to transmit or receive payment settlement information in purchasing goods or using services by electronic means or to execute as an agent or mediate the settlement of prices thereof;

20. The term “chain store” means any person, other than a financial company or an electronic financial business entity, who supplies goods or services to users in transactions conducted by an electronic debit payment means, electronic prepayment means or electronic currency under a contract concluded with a financial company or an electronic financial business entity;

21. The term “electronic financial infrastructure” means any information processing system used in electronic financial transactions and information and communication network defined in Article 2 (1) 1 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc.;

22. The term “electronic infringement” means any attack on electronic financial infrastructure by means of hacking, computer virus, logic bomb, mail bomb, denial of service, high-powered electromagnetic wave, etc.

Article 3 (Scope of Application)

(1) Except as otherwise expressly provided for in other Acts, this Act shall apply to all electronic financial transactions: Provided, That this Act shall not apply to the electronic financial transactions prescribed by Presidential Decree among those conducted under a separate contract between a financial company and an electronic financial business entity. (Amended by Act nº 11814, May 22, 2013)

(2) The provisions of Chapter V shall not apply to the financial companies referred to in subparagraph 3 (c) and (d) of Article 2. (Amended by Act nº 11814, May 22, 2013)

(3) The following shall not apply to the financial companies prescribed by Presidential Decree, considering the frequency of electronic financial transactions, size of company, etc. among financial companies: (Inserted by Act nº 11814, May 22, 2013)

1. Meeting the standards set by the Financial Services Commission for the information technology sector, in terms of human resources, facilities, electronic apparatus, etc. and electronic financial business under Article 21 (2);

2. Establishing and submitting plans for the information technology sector under Article 21 (4);

3. Appointing the chief information security officer under Article 21-2;

4. Analyzing and assessing the vulnerability of electronic financial infrastructure under Article 21-3.

Article 4 (Reciprocity)

This Act shall also apply to a foreigner or foreign corporation: Provided, That with respect to any foreigner or foreign corporation of the State which fails to provide protections corresponding to this Act for any national or corporation of the Republic of Korea, any protection under this Act or the treaties acceded to or concluded by the Republic of Korea may be restricted commensurately therewith.

CHAPTER II.- RIGHTS AND DUTIES OF PARTIES TO ELECTRONIC FINANCIAL TRANSACTIONS

SECTION 1.- Common Provisions

Article 5 (Use of Electronic Documents)

(1) Articles 4 through 7, 9, and 10 of the Framework Act on Electronic Documents and Transactions shall apply to electronic documents used for electronic financial transactions. (Amended by Act nº 11461, Jun. 1, 2012)

(2) Each electronic document received by a financial company or an electronic financial business entity in relation to a transaction request shall be deemed independent, respectively: Provided, That where the financial company or electronic financial business entity and a user undergoes the procedures for confirmation on an electronic financial transaction contract concluded among them, such procedures shall prevail. (Amended by Act nº 11814, May 22, 2013)

Article 6 (Selection, Use and Management of Means of Access)

(1) A financial company or an electronic financial business entity shall select, use and manage the means of access necessary for electronic financial transactions and confirm the identity and authority of a user, the details of a transaction request, etc. (Amended by Act nº 11814, May 22, 2013)

(2) A financial company or an electronic financial business entity shall issue the means of access only if an application is made by the user after verifying the identity of such user: Provided, That it may be also issued without the user’s application nor the verification of the user’s identity in any of the following cases: (Amended by Act nº 11814, May 22, 2013)

1. In case of an electronic prepayment means or electronic currency referred to in the proviso to Article 16 (1);

2. Where a user’s consent is obtained for the renewal, replacement, etc. of the means of access, as prescribed by Presidential Decree.

(3) No one shall commit any of the following acts unless otherwise expressly provided for in other Acts with respect to the use and management of a means of access: Provided, That the same shall not apply to cases (excluding the act referred to in subparagraph 3 and other acts of assisting the said act) where it is necessary to transfer an electronic prepayment means or electronic currency, or to offer it as security under Article 18: (Amended by Act nº 9325, Dec. 31, 2008; Act nº 13069, Jan. 20, 2015; Act nº 13929, Jan. 27, 2016)

1. Transferring or taking over a means of access;

2. Borrowing or lending a means of access, or storing, delivering or distributing a means of access, accompanied by receipt, demand or promise of any compensation;

3. Borrowing or lending a means of access, or storing, delivering or distributing a means of access, for the purpose of using it for any crime or with the knowledge of the fact that it will be used for any crime;

4. Providing a means of access as the object of pledge;

5. Arranging or advertizing any act referred to in subparagraphs 1 through 4.

Article 6-2 (Suspension, etc. of Using Telephone Numbers Used in Illegal Advertisements)

(1) When the Prosecutor General, Commissioner of the National Police Agency, or Governor of the Financial Supervisory Service (referring to the Governor of the Financial Supervisory Service under Article 29 of the Act on the Establishment, etc. of Financial Services Commission; hereafter the same shall apply) identifies a telephone number used in illegal advertisements referred to in Article 6 (3) 5, he/she may request the Minister of Science and Information and Communications Technology (ICT) to suspend provision of telecommunications services related to the relevant telephone number. (Amended by Act nº 14839, Jul. 26, 2017)

(2) A person to whom provision of telecommunications services is suspended following a request made pursuant to paragraph (1) may raise an objection to the person who requested suspension of provision of telecommunications services.

(3) Matters necessary for the procedures, etc. regarding raising of an objection under paragraph (2) shall be prescribed by Presidential Decree.

(Article Inserted by Act nº 13929, Jan. 27, 2016)

Article 7 (Confirmation of Transaction Details)

(1) Any financial company or electronic financial business entity shall ensure that a user can confirm the transaction details through an electronic apparatus (including electronic apparatus, if any, stipulated in advance between the financial company or electronic financial business entity and the user) used for electronic financial transactions. (Amended by Act nº 11814, May 22, 2013)

(2) Any financial company or electronic financial business entity shall, upon a user’s request to deliver relevant transaction details in writing (excluding any electronic document; hereinafter the same shall apply), deliver to him/her a document stating the details of his/her transaction within two weeks after receipt of such request. (Amended by Act nº 11814, May 22, 2013)

(3) Matters concerning the coverage period, types and scope of the transaction details offered pursuant to paragraphs (1) and (2) and other matters shall be prescribed by Presidential Decree.

Article 8 (Correction, etc. of Errors)

(1) When a user recognizes the existence of any error in electronic financial transactions, he/she may request the relevant financial company or electronic financial business entity to correct such error. (Amended by Act nº 11814, May 22, 2013)

(2) Upon receipt of a request to correct an error under paragraph (1), any financial company or electronic financial business entity shall immediately investigate and effect appropriate corrections to the processed transaction, and inform the user of the causes of the error and the results of correction by the methods prescribed by Presidential Decree within two weeks after receipt of such request. (Amended by Act nº 9325, Dec. 31, 2008; Act nº 11814, May 22, 2013)

(3) When any financial company or electronic financial business entity recognizes the existence of any error in electronic financial transactions, it or he/she shall immediately investigate and effect appropriate corrections to the processed transaction, and inform the user of the causes of the error and the results of correction in the methods prescribed by Presidential Decree within two weeks after recognizing such error. (Amended by Act nº 9325, Dec. 31, 2008; Act nº 11814, May 22, 2013)

Article 9 (Liability of Financial Companies or Electronic Financial Business Entities)

(1) When a user suffers any loss due to any of the following incidents, the relevant financial company or electronic financial business entity shall be liable for indemnifying him/her for the loss: (Amended by Act nº 11814, May 22, 2013)

1. An incident caused by the forgery or alteration of the means of access;

2. An incident caused in the course of electronically transmitting or processing the conclusion of a contract or a transaction request;

3. An incident caused by the use of a means of access acquired by fraudulent or other illegal means by invading electronic apparatus for electronic financial transactions or an information and communication network defined in Article 2 (1) 1 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc.

(2) Notwithstanding paragraph (1), a financial company or an electronic financial business entity may require a user to fully or partially bear the liability for any loss in any of the following cases: (Amended by Act nº 11814, May 22, 2013)

1. Where, with respect to any incident caused by the intention or gross negligence of the user, a prior agreement is made with the user to the effect that all or part of the loss may be borne by the user;

2. Where a corporate user (excluding any small enterprise defined in Article 2 (2) of the Framework Act on Small and Medium Enterprises) suffers any loss although the financial company or electronic financial business entity fulfills the duty of due care reasonably required to prevent incidents, such as the establishment and strict observance of security procedures.

(3) The intention or gross negligence of the user referred to in paragraph (2) 1 shall be limited to that stipulated in the terms and conditions of electronic financial transactions (hereinafter referred to as “terms and conditions“) within the limits prescribed by Presidential Decree.

(4) Every financial company or electronic financial business entity shall take measures necessary to discharge the liability provided for in paragraph (1), such as purchasing insurance, joining a mutual aid society or accumulating reserves, pursuant to the standards determined by the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

Article 10 (Liability for Loss or Theft of Means of Access)

(1) Upon receipt of a user’s notification of the loss or theft of the means of access, the relevant financial company or electronic financial business entity shall be liable for compensating the user for any loss he/she might suffer due to the use of such means of access by a third party from the time such notification is received: Provided, That the same shall not apply to cases prescribed by Presidential Decree where any damage is caused by the loss, theft, etc. of electronic prepayment means or electronic currency. (Amended by Act nº 11814, May 22, 2013)

(2) Notwithstanding paragraph (1) of this Article and Article 9, if any provision of other Acts and subordinate statutes applicable favorably to the user exists, such provision shall prevail.

Article 11 (Status of Subsidiary Electronic Financial Business Entities)

(1) The intention or negligence of a subsidiary electronic financial business entity (including any electronic bond management agency; hereafter the same shall apply in this Chapter) in relation to electronic financial transactions shall be deemed the intention or negligence of the relevant financial company or electronic financial business entity. (Amended by Act nº 11814, May 22, 2013)

(2) When any financial company or electronic financial business entity compensates the user for any loss caused by the intention or negligence of its or his/her subsidiary electronic financial business entity, it or he/she may exercise the right of indemnity over the subsidiary electronic financial business entity. (Amended by Act nº 11814, May 22, 2013)

(3) Any user may give various notifications he/she is obligated to give to a financial company or an electronic financial business entity to its or his/her subsidiary electronic financial business entity pursuant to an agreement made with the financial company or electronic financial business entity. In such cases, a notification given to the subsidiary electronic financial business entity shall be deemed to have been given to the relevant financial company or electronic financial business entity. (Amended by Act nº 11814, May 22, 2013)

SECTION 2.- Electronic Payment Transactions, etc.

Article 12 (Validity of Electronic Payment Transaction Contracts)

(1) Any financial company or electronic financial business entity shall make a payment by transmitting the amount requested by a payer or payee on a transaction request to the payee or his/her financial company or electronic financial business entity, pursuant to an agreement made with the payer or payee to facilitate electronic payment transactions. (Amended by Act nº 11814, May 22, 2013)

(2) When any financial company or electronic financial business entity becomes unable to transmit the amount requested pursuant to paragraph (1), it or he/she shall return to the payer the amount received for electronic payment transactions. In such cases, when the failure to transmit the amount is caused by the negligence of the payer, the expenses incurred in relation to such transmission may be deducted. (Amended by Act nº 11814, May 22, 2013)

Article 13 (Time when Payment Takes Effect)

(1) Where a payment is made by electronic payment means, such payment shall take effect at the time set forth in the following: (Amended by Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

1. For electronic funds transfers: When the information on the amount transferred on a transaction request is completely recorded on the ledger of the account of a financial company or an electronic financial business entity with which the payee’s account is opened;

2. For withdrawal of cash directly from electronic apparatus: When the payee receives such cash;

3. For payments made by an electronic prepayment means or electronic currency: When the information on the amount requested on a transaction request gets to the electronic apparatus designated by the payee;

4. For payments made by other electronic payment means: When the information on the amount requested on a transaction request is completely input in the electronic apparatus of a financial company or an electronic financial business entity with which the payee’s account is opened.

(2) The financial companies or electronic financial business entities prescribed by Presidential Decree in consideration of their total assets, etc. shall, upon their user’s request, ensure that payment of electronic funds transfer takes effect after a certain time has elapsed since such user makes such transaction request, in accordance with the procedures and methods prescribed by Presidential Decree. (Inserted by Act nº 12837, Oct. 15, 2014)

Article 14 (Withdrawal of Transaction Requests)

(1) Any user may withdraw his/her transaction request before the payment takes effect pursuant to each subparagraph of Article 13 (1). (Amended by Act nº 12837, Oct. 15, 2014)

(2) Notwithstanding paragraph (1), a financial company or an electronic financial business entity and its user may, pursuant to a prior agreement, determine differently the timing for withdrawing a transaction request with respect to any batch transaction, reserved transaction, etc. (Amended by Act nº 11814, May 22, 2013)

(3) Any financial company or electronic financial business entity shall include in its or his/her terms and conditions the matters relating to the methods and procedures for withdrawing a transaction request under paragraph (1) and the prior agreement under paragraph (2). (Amended by Act nº 11814, May 22, 2013)

Article 15 (Consent to Withdraw Deposits by Transfer)

(1) Any financial company or electronic financial business entity shall obtain consent from the payer in advance to the withdrawal of deposits to effect a collection transfer, as prescribed by Presidential Decree. (Amended by Act nº 11814, May 22, 2013)

(2) Any payer may request a financial company or an electronic financial business entity to revoke his/her consent to withdrawal under paragraph (1) before the withdrawal of deposits is completely recorded on the ledger of the payer’s account pursuant to a transaction request of the payee. (Amended by Act nº 11814, May 22, 2013)

(3) Notwithstanding paragraph (2), a financial company or an electronic financial business entity may, pursuant to a prior agreement made with the payer, determine differently the timing for revoking the consent with respect to any batch transaction, reserved transaction, etc. (Amended by Act nº 11814, May 22, 2013)

(4) Any financial company or electronic financial business entity shall include in its or his/her terms and conditions the matters relating to the methods and procedures for revoking the consent and the prior agreement under paragraphs (2) and (3). (Amended by Act nº 11814, May 22, 2013)

Article 16 (Issuance, Use and Exchange of Electronic Currencies)

(1) Any financial company or electronic financial business entity that issues an electronic currency (hereinafter referred to as “electronic currency issuer“) shall, in issuing the electronic currency, assign identifiable numbers to the means of access and manage it by linking the numbers to the user’s real name (hereinafter referred to as “real name“) defined in subparagraph 4 of Article 2 of the Act on Real Name Financial Transactions and Confidentiality or deposit account: Provided, That the same shall not apply to any electronic currency, the upper limit of whose face value does not exceed the amount prescribed by Presidential Decree. (Amended by Act nº 11814, May 22, 2013)

(2) The electronic currency issuer shall issue the electronic currency in exchange for the same value of cash or deposits.

(3) The electronic currency issuer shall take necessary measures to keep and use the issued electronic currency so that electronic currency holders can use it.

(4) The electronic currency issuer shall, upon a request by its holder, have the duty to exchange such electronic currency for cash or deposits.

(5) The methods and procedures for the issuance and exchange of electronic currency under paragraphs (1) through (4) shall be prescribed by Presidential Decree.

Article 17 (Validity of Payment by Electronic Currencies)

When an electronic currency holder pays the prices of goods or services by electronic currency pursuant to an agreement with the payee, the duty to pay such prices shall be deemed fulfilled.

Article 18 (Transferability of Electronic Currencies, etc.)

(1) The holder of an electronic prepayment means or electronic currency may transfer it to a third party or offer it as a security pursuant to an agreement with its issuer.

(2) When an electronic prepayment means or electronic currency is transferred to a third party or offered as a security under paragraph (1), it shall be necessarily done via the issuer’s central computer system: Provided, That the same shall not apply to any electronic prepayment means whose real name is not confirmed or the electronic currency referred to in the proviso to Article 16 (1).

Article 19 (Refund of Electronic Prepayment Means)

(1) Any financial company or electronic financial business entity that issues an electronic prepayment means shall, upon a request by its holder, refund the balance recorded on such electronic prepayment means pursuant to a prior agreement. (Amended by Act nº 11814, May 22, 2013)

(2) Any financial company or electronic financial business entity shall enter, in the terms and conditions, the agreement on the refund under paragraph (1) and the fact that it or he/she will fully pay the balance recorded on the electronic prepayment means in any of the following cases: (Amended by Act nº 11814, May 22, 2013)

1. Where the electronic prepayment means becomes unavailable because it is impracticable for a chain store to supply goods or services due to an act of God, etc.;

2. Where a chain store cannot supply goods or services due to any defect in the electronic prepayment means;

3. Where the balance recorded on the electronic prepayment means falls below a fixed rate. In such cases, the fixed rate shall be less than 20/100.

Article 20 (Requisite for Setting Up Transfer of Electronic Bonds)

(1) The transfer of electronic bonds shall be deemed to satisfy the requisite for setting up against the obligor referred to in Article 450 (1) of the Civil Act when meeting all the following requirements:

1. The notice made by the transferor to transfer the electronic bonds or the obligor’s consent thereto shall be given through an electronic document bearing the certified digital signature provided for in subparagraph 3 of Article 2 of the Digital Signature Act;

2. The electronic document stating the notice or consent referred to in subparagraph 1 shall be registered with an electronic bond management agency.

(2) The electronic document stating the notice or consent referred to in paragraph (1) shall be deemed to satisfy the requisite for setting up against the obligor referred to in Article 450 (2) of the Civil Act when completing the time-stamp stipulated in Article 20 of the Digital Signature Act and meeting all the requirements referred to in paragraph (1).

CHAPTER III.- ENSURING SAFETY OF ELECTRONIC FINANCIAL TRANSACTIONS AND PROTECTION OF USERS

Article 21 (Duty to Ensure Safety)

(1) A financial company or an electronic financial business entity and its or his/her subsidiary electronic financial business entity (hereinafter referred to as “financial company, etc.”) shall perform its or his/her duties of a good manager to ensure the safe processing of electronic financial transactions. (Amended by Act nº 11814, May 22, 2013)

(2) In order to ensure the safety and reliability of electronic financial transactions, a financial company etc. shall comply with the standards determined by the Financial Services Commission with respect to the information technology sector, such as human resources, facilities, electronic apparatus, and expenses for conducting electronic transmissions or processing, the electronic financial affairs and certification methods including the use of certificates under the Digital Signature Act. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

(3) The Financial Services Commission shall not compel the use of any specific technology or service when determining the standards referred to in paragraph (2) and shall endeavor to promote the fair competition of security technologies and certification technologies. (Amended by Act nº 12837, Oct. 15, 2014)

(4) For safe electronic financial transactions, the financial companies or electronic financial business entities prescribed by Presidential Decree shall annually establish a plan for the information technology sector and submit it to the Financial Services Commission after obtaining confirmation and signature of its or his/her representative, as prescribed by Presidential Decree. (Inserted by Act nº 11814, May 22, 2013)

Article 21-2 (Appointment of Chief Information Security Officers)

(1) Any financial company or electronic financial business entity shall appoint a chief information security officer to be responsible for managing electronic financial business and information technology security which forms the basis of electronic financial business. (Amended by Act nº 11814, May 22, 2013)

(2) A financial company or an electronic financial business entity prescribed by Presidential Decree in consideration of its or his/her total assets, number of employees, etc. shall appoint one of the executives (including any person prescribed in Article 401-2 (1) 3 of the Commercial Act) as a chief information security officer. (Amended by Act nº 11814, May 22, 2013)

(3) The chief information security officer of the financial companies or electronic financial business entities prescribed by Presidential Decree in consideration of its or his/her total assets, number of employees, etc. shall not concurrently perform duties in the information technology sector other than those referred to in paragraph (4). (Inserted by Act nº 12837, Oct. 15, 2014)

(4) A chief information security officer under paragraph (1) shall perform the following duties: (Amended by Act nº 12837, Oct. 15, 2014)

1. Establishing strategies and plans for securing the stability of electronic financial transactions and protecting the users thereof;

2. Protecting the information technology sector;

3. Managing human resources and forming a budget, which are necessary for the security of the information technology sector;

4. Preventing electronic financial transaction accidents, and taking measures therefor;

5. Other matters prescribed by Presidential Decree for securing the stability of electronic financial transactions.

(5) Matters necessary for qualifications, etc. for a chief information security officer shall be prescribed by Presidential Decree. (Amended by Act nº 12837, Oct. 15, 2014)

(Article Inserted by Act nº 11087, Nov. 14, 2011)

Article 21-3 (Analyzing and Assessing Vulnerability of Electronic Financial Infrastructure)

(1) To ensure the safety and reliability of electronic financial transactions, a financial company and an electronic financial business entity shall analyze and assess the following matters with respect to its or his/her electronic financial infrastructure and report the findings therefrom (referring to the findings from analysis and assessment of vulnerability, where conducted under Article 9 of the Act on the Protection of Information and Communications Infrastructure) to the Financial Services Commission:

1. Matters relating to the organization, facilities, and internal control of the information technology sector;

2. Matters relating to electronic apparatus and the means of access of the information technology sector;

3. Matters relating to measures to respond to infringements in order to maintain electronic financial transactions;

4. Other matters prescribed by Presidential Decree.

(2) A financial company and an electronic financial business entity shall establish and implement a plan to take necessary complementary measures based on the findings from analysis and assessment of vulnerability in the electronic financial infrastructure under paragraph (1).

(3) The Financial Services Commission may require public officials under its control to inspect the findings from analysis and assessment of vulnerability in the electronic financial infrastructure under paragraph (1) and the actual status of implementing complementary measures pursuant to paragraph (2).

(4) Details of and procedures for analysis and assessment of vulnerability in the electronic financial infrastructure under paragraph (1) and the establishment and implementation of the plan under paragraph (2) and other necessary matters shall be prescribed by Presidential Decree.

(Article Inserted by Act nº 11814, May 22, 2013)

Article 21-4 (Prohibition against Electronic Infringement, etc.)

No person shall commit any of the following offences:

1. For anyone without access authority to access electronic financial infrastructure, or for anyone with access authority to fabricate, destroy, hide or lose the stored data beyond his/her authority;

2. Installing programs, such as computer virus, logic bomb, or mail bomb, for the purpose of destroying data of electronic financial infrastructure or obstructing the operation of electronic financial infrastructure;

3. Causing errors or hindrance to electronic financial infrastructure by methods, such as sending mass signal, high-powered electromagnetic wave or data simultaneously or having fraudulent commands be processed, for the purpose of obstructing the stable operation of electronic financial infrastructure.

(Article Inserted by Act nº 11814, May 22, 2013)

Article 21-5 (Notification, etc. of Infringement Incidents)

(1) If an incident, such as disturbance or paralysis of electronic financial infrastructure, occurs due to an electronic infringement (hereinafter referred to as “infringement incident”), the relevant financial company and electronic financial business entity shall, without delay, inform the Financial Services Commission thereof.

(2) If an infringement incident occurs, the relevant financial company and electronic financial business entity shall analyze the causes thereof and take necessary measures to prevent the spread of damage.

(Article Inserted by Act nº 11814, May 22, 2013)

Article 21-6 (Response to Infringement Incidents)

(1) The Financial Services Commission shall perform the following duties to respond to infringement incidents:

1. Collecting and disseminating information on infringement incidents;

2. Issuing preannouncements and warnings about infringement incidents;

3. Taking emergency measures against infringement incidents;

4. Other matters prescribed by Presidential Decree for responding to infringement incidents.

(2) Procedures and methods necessary for performing the duties referred to in paragraph (1) and other matters shall be prescribed by Presidential Decree.

(Article Inserted by Act nº 11814, May 22, 2013)

Article 22 (Creation, Preservation and Destruction of Electronic Financial Transaction Records)

(1) A financial company, etc. shall create the records (hereafter referred to as “electronic financial transaction records” in this Article) necessary to trace and search the details of electronic financial transactions or to verify or correct any error in such details and shall preserve them for a period prescribed by Presidential Decree within up to five years. (Amended by Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

(2) If the preservation period under paragraph (1) elapses and any commercial transaction relation, including financial transactions, is terminated, a financial company, etc. shall, within five years, destroy the relevant electronic financial transaction records (excluding credit information under the Credit Information Use and Protection Act; hereafter the same shall apply in this paragraph): Provided, That this shall not apply in any of the following cases: (Inserted by Act nº 12837, Oct. 15, 2014)

1. Where it is inevitable to meet any obligation under other Acts;

2. Other cases determined by the Financial Services Commission, where it is necessary to preserve electronic financial transaction records.

(3) The types, preservation methods, destruction procedures and methods of electronic financial transaction records to be preserved by financial companies, etc. in accordance with paragraphs (1) and (2), and the standards for determining the day when a commercial transaction relation is terminated shall be prescribed by Presidential Decree. (Amended by Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

Article 23 (Issuance and Limit of Use of Electronic Payment Means, etc.)

(1) The Financial Services Commission may require a financial company or an electronic financial business entity to set the following limits or take other necessary measures, in consideration of the characteristics of electronic payment means, as prescribed by Presidential Decree: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

1. The upper limit of the face value of an electronic currency and electronic prepayment means to be issued;

2. The limit of use of electronic funds transfer;

3. The limit of use of electronic debit payment means.

(2) The Financial Services Commission may require a financial company or an electronic financial business entity to set the upper limit of cash withdrawal from electronic apparatus or may take other necessary measures, as prescribed by Presidential Decree. (Inserted by Act nº 11814, May 22, 2013)

Article 24 (Clarification of Terms and Conditions and Notification of Alterations thereof)

(1) Any financial company or electronic financial business entity shall clarify the terms and conditions in concluding a contract for electronic financial transactions with a user, and, at the request of a user, deliver a copy of the terms and conditions to the user, along with explaining the details thereof, in the manner prescribed by the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(2) No financial company or electronic financial business entity shall, if it or he/she has concluded a contract in violation of paragraph (1), assert that the details of the terms and conditions are included in the relevant contract. (Amended by Act nº 11814, May 22, 2013)

(3) Any financial company or electronic financial business entity shall, if it or he/she has altered the terms and conditions, publish the altered terms and conditions and inform the users thereof by one month prior to the enforcement of the altered terms and conditions, in the manner prescribed by the Financial Services Commission: Provided, That if the terms and conditions are urgently altered due to any amendment to Acts and subordinate statutes, it or he/she shall promptly publish the terms and conditions so altered and inform the users thereof in such manner prescribed by the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(4) Any user may terminate a contract for electronic financial transactions by no later than the business day immediately preceding the enforcement date of the altered terms and conditions after the details of the altered terms and conditions are published or informed pursuant to paragraph (3). When the user fails to raise an objection against the details of the altered terms and conditions within the period referred to in the first sentence, he/she shall be deemed to have approved the altered terms and conditions.

Article 25 (Preparation and Alteration of Terms and Conditions)

(1) When a financial company or an electronic financial business entity intends to prepare or alter the terms and conditions for electronic financial transactions, it or he/she shall in advance report thereon to the Financial Services Commission: Provided, That in cases determined by the Financial Services Commission which do not adversely affect the rights, interests or duties of users, a report may be file to the Financial Services Commission within ten days after the terms and conditions is prepared or altered. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(2) The Financial Services Commission may recommend a financial company or an electronic financial business entity to alter the terms and conditions under paragraph (1) if necessary to maintain orderly electronic financial transactions. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(3) The Financial Services Commission may determine the period and procedures for reporting the preparation or alteration of the terms and conditions under paragraph (1) and other necessary matters. (Amended by Act nº 8863, Feb. 29, 2008)

(4) Paragraphs (1) through (3) shall not apply to the financial companies defined in subparagraph 3 (c) and (d) of Article 2. (Amended by Act nº 11814, May 22, 2013)

Article 26 (Provision, etc. of Electronic Financial Transaction Information)

No one who recognizes the existence of any of the following matters in the course of performing duties relating to electronic financial transactions shall provide or disclose such information to any third party or use it for any purpose other than his/her duties without the consent of the relevant user: Provided, That the same shall not apply to cases provided for in the proviso to Article 4 (1) of the Act on Real Name Financial Transactions and Confidentiality or in any other Act:

1. The matters relating to the identity of the user;

2. The information or materials relating to the accounts, the means of access, and the details and results of electronic financial transactions of the user.

Article 27 (Settlement and Mediation of Disputes)

(1) Any financial company or electronic financial business entity shall prepare procedures to reflect reasonable opinions or complaints presented by users in relation to electronic financial transactions and to compensate for any loss sustained by users in the course of conducting electronic financial transactions, as prescribed by Presidential Decree. (Amended by Act nº 11814, May 22, 2013)

(2) When a user has an objection to the processing of electronic financial transactions, he/she may demand the settlement of dispute, such as compensation for losses, pursuant to the procedures determined under paragraph (1) or file an application for mediation of dispute with the Financial Supervisory Service, the Korea Consumer Agency, etc. (Amended by Act nº 11814, May 22, 2013)

(3) Detailed procedures and methods for the settlement of disputes and the application for mediation of disputes under paragraphs (1) and (2) and other matters shall be prescribed by Presidential Decree.

(4) Any financial company or electronic financial business entity shall clarify the procedures referred to in paragraphs (1) through (3) in concluding a contract for electronic financial transactions. (Amended by Act nº 11814, May 22, 2013)

CHAPTER IV.- PERMISSION, REGISTRATION AND FUNCTIONS OF ELECTRONIC FINANCIAL BUSINESS

Article 28 (Permission and Registration of Electronic Financial Business)

(1) Any person who intends to engage in a business issuing and managing electronic currencies shall obtain permission therefor from the Financial Services Commission: Provided, That the same shall not apply to the banks provided for in the Banking Act and other financial companies prescribed by Presidential Decree. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 10303, May 17, 2010; Act nº 11814, May 22, 2013)

(2) Any person who intends to provide any of the following services shall register himself/herself with the Financial Services Commission: Provided, That the same shall not apply to the banks provided for in the Banking Act and other financial companies prescribed by Presidential Decree: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 10303, May 17, 2010; Act nº 11814, May 22, 2013)

1. Electronic funds transfer services;

2. Issuance and management of electronic debit payment means;

3. Issuance and management of electronic prepayment means;

4. Electronic payment settlement agency services;

5. Other electronic financial services prescribed by Presidential Decree.

(3) Notwithstanding paragraph (2), any of the following persons may provide the services referred to in each subparagraph of the said paragraph without registering himself/herself with the Financial Services Commission: (Amended by Act nº 8863, Feb. 29, 2008)

1. Any person who issues an electronic prepayment means falling under any of the following cases:

(a) Where it is only used at chain stores meeting the standards prescribed by Presidential Decree, such as the chain stores located within specially designated buildings;

(b) Where the total balance of its issued amount does not exceed the amount prescribed by Presidential Decree;

(c) Where it is an electronic prepayment means, the price of which has not been pre-paid directly by a user and is covered by a refund guarantee insurance, etc. as prescribed by Presidential Decree to discharge the liability for monetary values stored by the user;

2. Any person who performs the electronic payment settlement agency services prescribed by Presidential Decree, such as delivering information only for the electronic processing of electronic payment transactions without direct involvement in the transfer of funds.

(4) Article 4, Chapters II (excluding Article 19) and III (excluding Articles 21 (4), 21-2, 21-3, 23 and 25), and Articles 37, 38, 39 (1) and (6), 41 (1), 43 (2) and (3), 46, 46-2, and 47 concerning electronic financial business entities shall apply mutatis mutandis to the persons who issue electronic prepayment means exempted from registration under paragraph (3) 1 (c): Provided, That Articles 25, 39 (2) through (5), and 40 (2) and (3) shall apply mutatis mutandis where the financial incidents prescribed by Presidential Decree occur, such as insolvency due to any illegal or unjust act committed by the relevant employees or officers. (Amended by Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

(5) The Financial Services Commission may attach a condition to the permission granted under paragraph (1). (Amended by Act nº 8863, Feb. 29, 2008)

Article 29 (Registration of Electronic Bond Management Agencies)

(1) Any person who intends to engage in a business registering and managing electronic bonds shall register himself/herself with the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008)

(2) Articles 21, 22, 39, 41, and 43 shall apply mutatis mutandis to the electronic bond management agencies which are registered to carry out the business of registering and managing electronic bonds pursuant to paragraph (1).

(3) The procedures and methods for the registration of electronic bonds by electronic bond management agencies and other necessary matters shall be prescribed by Presidential Decree.

Article 30 (Capital)

(1) Any person who intends to obtain permission pursuant to Article 28 (1) shall be a stock company with a capital of at least five billion won.

(2) Either of the following entities is eligible for registration pursuant to Article 28 (2) 1 through 3, and its capital or total investment shall exceed the amount prescribed by Presidential Decree, which is at least two billion won for each category of business: (Amended by Act nº 11814, May 22, 2013)

1. A company provided for in Article 170 of the Commercial Act;

2. A corporation incorporated under a special Act (limited to the issuance and management of electronic prepayment means under Article 28 (2) 3 to perform the duties provided for in the relevant Act).

(3) An entity eligible for registration pursuant to Article 28 (2) 4 and 5 and Article 29 shall be a company provided for in Article 170 of the Commercial Act or a corporation stipulated in Article 32 of the Civil Act, the capital, total investments or fundamental property of which exceeds the amount prescribed by Presidential Decree, which is at least the amount referred to in the following subparagraphs for each category of business: (Amended by Act nº 14132, Mar. 29, 2016)

1. A person who intends to operate below the standard defined by the Financial Services Commission, within the scope in which the total amount of electronic financial transactions per quarter does not exceed three billion won (excluding a person who intends to register pursuant to Article 29): An amount prescribed by Presidential Decree of at least 300 million won;

2. A person not falling under subparagraph 1: An amount prescribed by Presidential Decree of at least 500 million won.

(4) Where a person falling under paragraph (3) 1 registers pursuant to Article 28 and continues to exceed the standard defined by the Financial Services Commission under paragraph (3) 1 for at least two consecutive quarters, he/she shall report the relevant details to the Financial Services Commission, and shall satisfy the requirements for capital under paragraph (3) 2 within the period set by the Financial Services Commission. (Inserted by Act nº 14132, Mar. 29, 2016)

Article 31 (Requirements for Permission and Registration)

(1) Any person who intends to obtain permission or file for registration pursuant to Articles 28 and 29 shall meet all of the following requirements. Subparagraphs 4 and 5 shall only apply to permission:

1. He/she shall hold the capital or fundamental property referred to in Article 30;

2. He/she shall be equipped with professional human resources and physical installations, such as computer equipment, sufficient to protect users and carry out the intended business;

3. He/she shall meet the standards of financial soundness prescribed by Presidential Decree;

4. He/she shall have a proper and sound plan necessary to execute the business concerned;

5. He/she shall secure the major investors prescribed by Presidential Decree, with sufficient investment capability, sound financial state and social credit.

(2) Matters necessary for the detailed requirements for permission and registration under paragraph (1) shall be determined by the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008)

Article 32 (Disqualification for Permission and Registration)

None of the following persons are entitled to permission or registration under Articles 28 and 29: (Amended by Act nº 8863, Feb. 29, 2008)

1. A corporation for which one year has not yet passed since its registration was cancelled pursuant to Article 34, and a person who was a large stockholder (referring to any such investor prescribed by Presidential Decree; hereinafter the same shall apply) of the corporation at the time of cancellation of such registration and for whom one year has not yet passed since the registration was cancelled;

2. A corporation for which three years have not yet passed since its permission or registration was revoked pursuant to Article 43 (1), and a person who was a large stockholder of the corporation at the time of such revocation and for whom three years have not yet passed since such revocation;

3. A company which is in process of the rehabilitation procedure pursuant to the Debtor Rehabilitation and Bankruptcy Act and the large stockholders of such company;

4. Any person who has failed to pay a debt within an agreed period in financial transactions and other commercial transactions and who is determined by the Financial Services Commission;

5. Any person who has been punished by a fine or heavier punishment for violating the finance-related Acts or subordinate statutes prescribed by Presidential Decree within the three years preceding the date of application for permission or registration;

6. A corporation whose large stockholder falls under any of subparagraphs 1 through 5.

Article 33 (Applications, etc. for Permission, Registration and Authorization)

(1) Any person who intends to obtain permission or authorization or file for registration pursuant to Article 28, 29, or 45 shall submit an application therefor to the Financial Services Commission, as prescribed by Presidential Decree. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(2) Upon receipt of an application under paragraph (1), the Financial Services Commission shall grant permission, registration, or authorization and notify the applicant of the results, as prescribed by Presidential Decree. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(3) When the Financial Services Commission grants permission, registration or authorization pursuant to Articles 28, 29, and 45, it shall, without delay, publish the details thereof in the Official Gazette and inform the general public thereof through computer communications, etc. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

Article 33-2 (Preliminary Permission)

(1) Any person who intends to obtain permission under Article 28 (1) (hereafter referred to as “final permission” in this Article) may, in advance, file an application for preliminary permission with the Financial Services Commission.

(2) When the Financial Services Commission decides whether to grant preliminary permission under paragraph (1), it shall verify that the person who intends to obtain preliminary permission meets all requirements for final permission.

(3) The Financial Services Commission may attach a condition to preliminary permission under paragraph (2).

(4) When any person who obtained preliminary permission files an application for final permission, the Financial Services Commission shall verify whether he/she has fulfilled the condition to preliminary permission under paragraph (3) and has met all requirements for final permission, before it decides whether to grant final permission.

(5) Article 33 (1) and (2) shall apply mutatis mutandis to preliminary permission.

(Article Inserted by Act nº 11814, May 22, 2013)

Article 34 (Cancellation of Registration Subject to Application)

(1) Any person who has been granted registration pursuant to Articles 28 (2) and 29 may file an application for the cancellation of such registration, as prescribed by Presidential Decree.

(2) The Financial Services Commission shall, upon receipt of an application under paragraph (1), cancel the registration without delay. (Amended by Act nº 8863, Feb. 29, 2008)

(3) When the Financial Services Commission has cancelled registration pursuant to paragraph (2), it shall, without delay, publish the details thereof in the Official Gazette and inform the general public thereof through computer communications, etc. (Amended by Act nº 8863, Feb. 29, 2008)

Article 35 (Restriction on Concurrent Businesses)

(1) Any electronic financial business entity who has obtained permission pursuant to Article 28 (1) shall be prohibited from concurrently engaging in any business other than the following:

1. Services provided for in the subparagraphs of Article 28 (2) (limited to registered ones);

2. Business permitted pursuant to Article 28 (1) and other business prescribed by Presidential Decree and necessary to provide the services referred to in subparagraph 1.

(2) Notwithstanding paragraph (1), any electronic financial business entity who has obtained permission pursuant to Article 28 (1) may engage in the business other than those referred to in the subparagraphs of paragraph (1), if it or he/she is provided with payment guarantee by the financial companies prescribed by Presidential Decree or purchase refund guarantee insurance for all of the non-refunded portions of electronic currency. (Amended by Act nº 11814, May 22, 2013)

Article 36 (Prohibition against Use of Similar Names)

(1) The name ‘electronic currency’ shall be used only for the electronic currency referred to in subparagraph 15 of Article 2.

(2) Any person who has failed to obtain permission pursuant to Article 28 (1) may not use the phrase ‘electronic currency’ in his/her trade name.

Article 37 (Matters to be Observed by Chain Stores)

(1) No chain store shall refuse to provide goods or services, or treat any user unfavorably, on the grounds that transactions are conducted by electronic debit payment means, electronic prepayment means or electronic currency (hereinafter referred to as “electronic currency, etc.”).

(2) No chain store shall charge users a merchant fee to be borne by such store.

(3) No chain store shall commit any of the following offences:

1. Pretending that a transaction is conducted by electronic currency, etc. without providing goods or services;

2. Conducting transactions by electronic currency, etc. in excess of actual turnover;

3. Conducting transactions by electronic currency, etc. under the name of another chain store;

4. Lending the name of the chain store to a third party;

5. Conducting, as an agent, transactions by electronic currency, etc.

(4) A person other than a chain store shall not conduct any transaction by electronic currency, etc. under the name of a chain store.

Article 38 (Recruitment, etc. of Chain Stores)

(1) In recruiting a chain store, any financial company or electronic financial business entity shall confirm whether the store seeking membership actually carries on its own business: Provided, That the same shall not apply to a chain store which has already been confirmed pursuant to Article 16-2 of the Specialized Credit Finance Business Act. (Amended by Act nº 11814, May 22, 2013)

(2) No financial company or electronic financial business entity shall have its or his/her chain store bear a loss incurred by either of the following transactions: Provided, That the same shall not apply where a financial company or an electronic financial business entity concludes a contract with its or his/her chain store to the effect that such loss shall be fully or partially borne by the chain store when the financial company or electronic financial business entity proves the intention or gross negligence of the chain store in connection with the transaction: (Amended by Act nº 11814, May 22, 2013)

1. A transaction conducted using a lost or stolen electronic currency, etc.;

2. A transaction conducted using a forged or altered electronic currency, etc.

(3) Any financial company or electronic financial business entity shall inform its or his/her chain stores of the following matters, in the manner prescribed by the Financial Services Commission: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

1. A merchant fee to be borne by chain stores;

2. Liability for chain stores under paragraph (2);

3. Matters to be observed by chain stores under Article 37.

(4) When a chain store is sentenced to a punishment for violating Article 37 or receives a written notification of such violation from the relevant administrative agency, and thus falls under the grounds prescribed by Presidential Decree, the relevant financial company or electronic financial business entity shall, without delay, terminate the contract with the said chain store unless any special ground exists to the contrary. (Amended by Act nº 11814, May 22, 2013)

CHAPTER V.- SUPERVISION OF ELECTRONIC FINANCIAL BUSINESS

Article 39 (Supervision and Inspection)

(1) The Financial Supervisory Service (referring to the Financial Supervisory Service established under Article 24 (1) of the Act on the Establishment, etc. of Financial Services Commission; hereinafter the same shall apply) shall supervise whether financial companies and electronic financial business entities abide by this Act or orders issued under this Act, following instructions from the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(2) The Governor of the Financial Supervisory Service may require a financial company or an electronic financial business entity to report on its or his/her business operations and financial conditions if necessary to conduct supervision under paragraph (1). (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013; Act nº 13929, Jan. 27, 2016)

(3) The Governor of the Financial Supervisory Service may inspect the electronic financial business and other related financial conditions of a financial company and an electronic financial business entity and, if deemed necessary to conduct such inspection, ask the financial company and the electronic financial business entity to submit data relating to its or his/her business operations and financial conditions or to order the attendance of all relevant persons. (Amended by Act nº 11814, May 22, 2013)

(4) Any person who conducts an inspection pursuant to paragraph (3) shall carry an identification indicating his/her authority and present it to relevant persons.

(5) Upon conducting an inspection pursuant to paragraph (3), the Governor of the Financial Supervisory Service shall report the findings therefrom to the Financial Services Commission, as determined by the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008)

(6) When a financial company or an electronic financial business entity is deemed likely to undermine the sound operation of the financial company or electronic financial business entity in violation of any provision of this Act or any order issued under this Act, the Financial Services Commission may, upon recommendation of the Governor of the Financial Supervisory Service, take any of the following measures or authorize the Governor of the Financial Supervisory Service to take any measure referred to in subparagraphs 1 through 3: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013; Act nº 14828, Apr. 18, 2017)

1. Issuing an order to correct the relevant offence;

2. Issuing a caution or warning against a financial company or an electronic financial business entity;

3. Demanding caution, warning or reprimand against an executive officer or employee;

4. Recommending dismissal of an executive officer (excluding an operating officer under subparagraph 5 of Article 2 of the Act on Corporate Governance of Financial Companies; hereafter the same shall apply in Article 39-2) or suspending performance of his/her duties.

Article 39-2 (Notification of Details of Measures against Retired Executive Officer, etc.)

(1) Where, if a retired executive officer or employee (including an operating officer under subparagraph 5 of Article 2 of the Act on Corporate Governance of Financial Companies) of a financial company or electronic financial business entity held office as such, he/she would be deemed to be subject to any measure falling under Article 39 (6) 3 or 4, the Financial Services Commission (including the Governor of the Financial Supervisory Service authorized to take measures pursuant to Article 39 (6)) may notify the head of such financial company or electronic financial business entity of the details of such measure.

(2) The head of a financial company or electronic financial business entity in receipt of a notification under paragraph (1) shall notify the retired executive officer or employee of such fact, and keep and maintain the content of such notification.

(Article Inserted by Act nº 14828, Apr. 18, 2017)

Article 40 (Supervision and Inspection of Outside Orders, etc.)

(1) Where a financial company or an electronic financial business entity concludes or alters a contract with its or his/her subsidiary electronic financial business entity for affiliation, entrustment or outside orders (hereafter referred to as “outside order, etc.” in this Article) in relation to electronic financial transactions (including where a subsidiary electronic financial business entity concludes or alters a contract with another subsidiary electronic financial business entity for outside orders, etc.), it or he/she shall meet the standards determined by the Financial Services Commission to ensure the safety and reliability of electronic financial transactions and the soundness of the financial company and electronic financial business entity. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(2) Where the contents of a contract under paragraph (1) are deemed likely to undermine the operational soundness of a financial company or an electronic financial business entity and the rights and interests of users, the Financial Services Commission may direct the financial company or electronic financial business entity to correct or supplement the relevant contents of the contract. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(3) When the Governor of the Financial Supervisory Service conducts an inspection of a financial company or an electronic financial business entity in relation to outside orders, etc. under paragraph (1), he/she may request its or his/her subsidiary electronic financial business entity to submit data pursuant to the standards determined by the Financial Services Commission. (Amended by Act nº 8863, Feb. 29. 2008; Act nº 11814, May 22, 2013)

(4) When a subsidiary electronic financial business entity fails to submit data under paragraph (3) or submit insufficient data, the Governor of the Financial Supervisory Service may investigate the relevant subsidiary electronic financial business entity. (Inserted by Act nº 11814, May 22, 2013)

(5) The Governor of the Financial Supervisory Service may request the following from a subsidiary electronic financial business entity, if deemed necessary for conducting an investigation under paragraph (4): (Inserted by Act nº 11814, May 22, 2013)

1. Submitting a written statement relating to matters subject to such investigation;

2. Submitting a ledger, document or other articles necessary for such investigation;

3. Attendance of a relevant person.

(6) A subsidiary electronic financial business entity entrusted with any duties related to the data protection of the information technology sector shall not re-entrust such duties to a third party: Provided, That this shall not apply to cases recognized by the Financial Services Commission within the extent not impairing the protection and safe processing of electronic financial transaction information. (Inserted by Act nº 12837, Oct. 15, 2014)

(7) Article 39 (4) shall apply mutatis mutandis to investigations conducted under paragraph (4). (Inserted by Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

Article 41 (Requests, etc. for Submission of Data by Bank of Korea)

(1) When the Monetary Policy Committee deems it necessary for implementing monetary credit policies and facilitating the smooth operation of payment and settlement systems in relation to electronic payment transactions, the Bank of Korea may request a financial company or an electronic financial business entity to submit data. In such cases, the scope of data so requested shall be limited to a necessary minimum in consideration of the work burden of the relevant financial company and electronic financial business entity. (Amended by Act nº 11814, May 22, 2013)

(2) When the Monetary Policy Committee deems it necessary for implementing monetary credit policies, the Bank of Korea may request the Financial Supervisory Service to inspect the electronic currency issuer and the financial company and electronic financial business entity registered to provide the service referred to in Article 28 (2) 1 or to conduct a joint inspection thereof with the Bank of Korea. (Amended by Act nº 11814, May 22, 2013)

(3) Articles 87 and 88 of the Bank of Korea Act and Article 62 of the Act on the Establishment, etc. of Financial Services Commission shall apply mutatis mutandis to the methods and procedures for making requests under paragraphs (1) and (2). (Amended by Act nº 8863, Feb. 29, 2008)

Article 42 (Keeping Separate Accounts and Guidance for Sound Management)

(1) A financial company and an electronic financial business entity shall keep separate accounts by the category of business provided for in Article 28 (1) and (2) to analyze the performance of business relating to fund management and electronic financial transactions, and prepare a report on the business relating to electronic financial transactions and the outcomes of management and submit it to the Financial Services Commission, as determined by the Financial Services Commission. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

(2) The Financial Services Commission may set the standards for management guidance for the following matters to direct the sound management of a financial company or an electronic financial business entity that performs the business relating to electronic financial transactions and to prevent electronic financial incidents, as prescribed by Presidential Decree: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

1. Matters relating to the appropriateness of capital;

2. Matters relating to the soundness of assets;

3. Matters relating to liquidity;

4. Other matters necessary to ensure the soundness of management.

(3) Where any financial company or electronic financial business entity that has obtained permission under Article 28 (1) is deemed likely to severely undermine the soundness of its or his/her own management, such as failing to meet the standards for management guidance under paragraph (2), the Financial Services Commission may request it or him/her to take necessary measures to improve its or his/her own management, such as increasing capital and limiting dividends. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

(4) Articles 10, 11 (1), (4) and (5), 13-2, 14, 14-2 through 14-4, 14-7, 15 through 19, 27, and 28 of the Act on the Structural Improvement of the Financial Industry shall apply mutatis mutandis to the measures, etc. necessary to be taken when the financial standing of the financial company or electronic financial business entity that has obtained permission under Article 28 (1) falls short of the standards for management guidance under paragraph (2) or is evidently deemed to fall short of the said standards due to any serious financial incident or insolvency claims. (Amended by Act nº 11814, May 22, 2013)

Article 43 (Revocation, etc. of Permission or Registration)

(1) When a financial company or an electronic financial business entity falls under any of the following cases, the Financial Services Commission may revoke permission or registration under Article 28: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

1. Where it or he/she has obtained permission or registration under Article 28 by fraudulent or other illegal means;

2. Where it or he/she falls under any of subparagraphs 1 through 5 of Article 32;

3. Where it or he/she has violated an order to suspend business issued under paragraph (2);

4. Where it or he/she has failed to run a business for one or more consecutive years without any just ground;

5. Where it or he/she has virtually closed its or his/her business due to the merger, bankruptcy or business closure of the relevant corporation or on other grounds.

(2) When a financial company or an electronic financial business entity falls under any of the following cases, the Financial Services Commission may order it or him/her to wholly or partially suspend the relevant business with a given period of up to six months: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013; Act nº 14132, Mar. 29, 2016)

1. Where it or he/she has violated Article 6 (1) or (2), 16 (1) through (4), 19 (1), 21 (1) or (2), 21-5 (2), 35, 36, or 38 (3) or (4);

2. Where it or he/she has failed to investigate an error and effect appropriate corrections, in violation of Article 8 (2) and (3);

3. Where it or he/she has failed to comply with any measure, direction or order taken or issued by the Financial Services Commission under Article 23, 39 (6), 40 (2) or 42 (3).

4. Where it or he/she fails to file a report under Article 30 (4) or fails to satisfy the requirements within the period.

(3) A financial company or an electronic financial business entity, whose business is wholly or partially suspended or permission or registration is revoked under paragraphs (1) and (2), may even so continue to perform the payment and settlement business of electronic financial transactions conducted prior to such disposition. (Amended by Act nº 11814, May 22, 2013)

(4) When the Financial Services Commission revokes permission or registration under paragraph (1), it shall, without delay, publish the details thereof in the Official Gazette and inform the general public thereof through computer communications, etc. (Amended by Act nº 8863, Feb. 29, 2008)

Article 44 (Hearings)

When the Financial Services Commission intends to revoke permission or registration under Article 43 (1), it shall hold a hearing thereon. (Amended by Act nº 8863, Feb. 29, 2008)

Article 45 (Authorization for Merger, Dissolution, Business Closure, etc.)

(1) When any electronic financial business entity who has obtained permission pursuant to Article 28 (1) intends to engage in any of the following activities, he/she shall obtain authorization therefor from the Financial Services Commission, as prescribed by Presidential Decree: (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013)

1. A merger with another financial company or electronic financial business entity;

2. Dissolution or the closure of electronic financial business;

3. Transfer and takeover all or part of business.

(2) The Financial Services Commission may attach a condition to authorization under paragraph (1). (Amended by Act nº 8863, Feb. 29, 2008)

Article 45-2 (Preliminary Authorization)

(1) Any person who intends to obtain authorization under Article 45 (1) (hereafter referred to as “final authorization” in this Article) may, in advance, file an application for preliminary authorization with the Financial Services Commission.

(2) When the Financial Services Commission decides whether to grant preliminary authorization under paragraph (1), it shall verify whether the person who intends to obtain preliminary authorization meets all requirements for final authorization.

(3) The Financial Services Commission may attach a condition to preliminary authorization under paragraph (2).

(4) When any person who obtained preliminary authorization files an application for final authorization, the Financial Services Commission shall verify whether he/she has fulfilled the condition to preliminary authorization under paragraph (3) and has met all requirements for final authorization before it decides whether to grant final authorization to him/her.

(5) Article 33 (1) and (2) shall apply mutatis mutandis to preliminary authorization.

(Article Inserted by Act nº 11814, May 22, 2013)

Article 46 (Penalty Surcharges)

(1) Where a financial company or an electronic financial business entity provides or discloses any electronic financial transaction information to any other person, or uses it for any purpose other than its duties in violation of Article 21 (1) or (2), the Financial Services Commission may impose a penalty surcharge not exceeding five billion won. (Inserted by Act nº 12837, Oct. 15, 2014)

(2) Where a financial company or an electronic financial business entity comes to fall under any of the subparagraphs of Article 43 (2) (excluding cases where a penalty surcharge is imposed under paragraph (1)), the Financial Services Commission may, as prescribed by Presidential Decree, impose a penalty surcharge not exceeding 50 million won in lieu of an order to suspend business. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

(3) The amount of a penalty surcharge for each type, severity, etc. of violations subject to the imposition of a penalty surcharge under paragraph (1) or (2) and other necessary matters shall be prescribed by Presidential Decree. (Amended by Act nº 12837, Oct. 15, 2014)

(4) Where a penalty surcharge under paragraph (1) or (2) is not paid within a prescribed period, the Financial Services Commission shall collect it in the same manner as delinquent national taxes are collected. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 12837, Oct. 15, 2014)

(5) The Financial Services Commission may entrust duties concerning both collection of penalty surcharges and dispositions on default to the Commissioner of the National Tax Service, as prescribed by Presidential Decree. (Amended by Act nº 8863, Feb. 29, 2008; Act nº 12837, Oct. 15, 2014)

Article 46-2 (Refund of Overpayments or Erroneous Payments)

(1) Where a person obliged to pay a penalty surcharge requests a refund of the overpaid or erroneously paid penalty surcharge on grounds of adjudication on the objection or a court ruling, the Financial Services Commission shall, without delay, make a refund thereof, and shall refund the overpaid or erroneously paid penalty surcharge confirmed by the Financial Services Commission, even without a request from the person obliged to pay such penalty surcharge.

(2) If a person entitled to a refund has to pay other penalty surcharges to the Financial Services Commission, the Financial Services Commission may appropriate the refund for such penalty surcharges when making a refund of overpayments or erroneous payments under paragraph (1).

(3) When making a refund of overpayments or erroneous payments under paragraph (1), the Financial Services Commission shall refund additional money calculated by applying the interest rate on additional money prescribed by Presidential Decree, for the period from the day following the payment date of the penalty surcharge to the date of refund.

(Article Inserted by Act nº 11814, May 22, 2013)

CHAPTER VI.- SUPPLEMENTARY PROVISIONS

Article 47 (Statistical Surveys of Electronic Financial Transactions)

(1) The Bank of Korea may conduct a statistical survey of electronic financial businesses and electronic financial transactions to apprehend the current status of electronic financial transactions and to establish and implement effective monetary credit policies. In such cases, it may request necessary data from a government agency, financial company, etc., and a corporation and organization related to electronic financial transactions. (Amended by Act nº 11814, May 22, 2013)

(2) Upon receipt of a request for data under paragraph (1), a government agency, financial company, etc., and a corporation and organization related to electronic financial transactions shall comply with such request unless any just ground exists to the contrary. (Amended by Act nº 11814, May 22, 2013)

(3) Matters necessary for the subject matter, methods and procedures of the statistical survey under paragraph (1) shall be prescribed by Presidential Decree.

Article 48 (Entrustment of Authority)

The Financial Services Commission may entrust the Governor of the Financial Supervisory Service with part of its authority under this Act, as prescribed by Presidential Decree. (Amended by Act nº 8863, Feb. 29, 2008)

CHAPTER VII.- PENALTY PROVISIONS

Article 49 (Penalty Provisions)

(1) Any of the following persons shall be punished by imprisonment with labor for not more than ten years, or by a fine not exceeding 100 million won: (Inserted by Act nº 12837, Oct. 15, 2014)

1. A person who accesses any electronic financial infrastructure or fabricate, destroy, conceal, or leak any stored data, in violation of subparagraph 1 of Article 21-4;

2. A person who destroys any data or installs programs, such as a computer virus, a logic bomb, a mail bomb, in violation of subparagraph 2 of Article 21-4;

3. A person who sends mass signal, high-powered electromagnetic wave or data simultaneously or causes errors or hindrance to electronic financial infrastructure, in violation of subparagraph 3 of Article 21-4;

4. A person who provides or leaks any electronic financial transaction information to any other person or uses such information for any purpose other than his/her duties (including a person issuing an electronic prepayment means applicable mutatis mutandis pursuant to Article 28 (4)), in violation of Article 26.

(2) Any of the following persons shall be punished by imprisonment with labor for not more than seven years, or by a fine not exceeding 50 million won: (Amended by Act nº 11814, May 22, 2013; Act nº 12837, Oct. 15, 2014)

1. A person who forges or alters a means of access;

2. A person who intermediates the sale of, sells, exports, imports, or uses a forged or altered means of access;

3. A person who intermediates the sale of, sells, exports, imports, or uses a lost or stolen means of access;

4. A person who intrudes into any electronic financial infrastructure or any electronic apparatus for electronic financial transactions to acquire a means of access by fraud or other unjustifiable means, or conducts electronic financial transactions by using the means of access so acquired;

5. A person who intermediates the sale of, sells, exports, imports or uses a means of access which was extorted, embezzled, or acquired by deceiving or blackmailing other person;

6. Deleted (By Act nº 12837, Oct. 15, 2014)

(3) Electronic currencies shall be deemed valuable securities with respect to which a person might be charged with any of the crimes prescribed in Articles 214 through 217 of the Criminal Act, and a crime involving with electronic currencies shall be subject to the punishment provided for in each of such Articles, correspondingly. (Amended by Act nº 12837, Oct. 15, 2014)

(4) Any of the following persons shall be punished by imprisonment with labor for not more than three years, or by a fine not exceeding 20 million won: (Amended by Act nº 9325, Dec. 31, 2008; Act nº 13069, Jan. 20, 2015; Act nº 13929, Jan. 27, 2016)

1. Any person who acquires or transfers a means of access in violation of Article 6 (3) 1;

2. Any person who borrows or lends a means of access, or storing, delivering or distributing a means of access, in violation of Article 6 (3) 2 or 3;

3. Any pledger or pledgee who violates Article 6 (3) 4;

4. Any person who arranges or advertises any act in violation of Article 6 (3) 5;

5. Any person who performs the duties without permission or registration under Article 28 or 29;

6. Any person who obtains permission or registration under Article 28 or 29 by fraudulent or other illegal means;

7. Any person who conducts a transaction by electronic currency, etc. under the name of another chain store in violation of Article 37 (3) 3;

8. Any person who has conducted, as an agent, transactions by electronic currency, etc. in violation of Article 37 (3) 5;

9. Any person who conducts a transaction by electronic currency, etc. under the name of another chain store in violation of Article 37 (4);

10. Any person who peruses or is provided with electronic financial transaction information by fraudulent or other illegal means.

(5) Any of the following persons shall be punished by imprisonment with labor for not more than one year, or by a fine not exceeding ten million won:

1. Deleted (By Act nº 9325, Dec. 31, 2008)

2. Deleted; (By Act nº 11814, May 22, 2013)

3. Any person who refuses to provide goods or services, or treats any user unfavorably, on grounds of transaction by electronic currency, etc. in violation of Article 37 (1);

4. Any person who charges a user a merchant fee to be borne by the relevant chain store in violation of Article 37 (2);

5. Any person who lend the name of a chain store to a third party in violation of Article 37 (3) 4;

6. Any person who engages in an activity falling under any subparagraph of Article 45 (1) without authorization under Article 45 (1).

(6) An attempt to commit the crimes referred to in paragraphs (1) 1, 2, and 3 and (2) 1, 2, and 4 shall be subject to punishment. (Amended by Act nº 12837, Oct. 15, 2014)

(7) The imprisonment with labor and fines referred to in paragraphs (1) through (6) may be concurrently imposed.

Article 50 (Joint Penalty Provisions)

(1) If the representative of a corporation, or any agent, employee or other employed persons of a corporation or individual has committed any offence falling under Article 49 (1), (2), (3) (limited to where any person is subject to the punishment prescribed in Article 216 of the Criminal Act) and (4) through (6) in connection with the duties of such corporation or individual, not only shall such offender be punished, but also such corporation or individual shall be punished by the fines prescribed in the relevant Article: Provided, That where such corporation or individual has not been negligent in giving due attention and supervision concerning the relevant duties to prevent such offense, this shall not apply. (Amended by Act nº 12837, Oct. 15, 2014)

(2) If the representative of a corporation, or any agent, employee or other employed persons of a corporation or individual has committed any offense falling under Article 49 (3) (limited to where any person is subject to the punishment prescribed in Article 214, 215, or 217 of the Criminal Act) in connection with the duties of such corporation or individual, not only shall such offender be punished, but also such corporation or individual shall be punished by a fine not exceeding 50 million won: Provided, That where such corporation or individual has not been negligent in giving due attention and supervision concerning the relevant duties to prevent such offense, this shall not apply. (Amended by Act nº 12837, Oct. 15, 2014)

(Article Amended by Act nº 11087, Nov. 14, 2011)

Article 51 (Administrative Fines)

(1) Any of the following persons (in cases falling under subparagraph 3, including persons who issue electronic prepayment means to which the relevant provisions apply mutatis mutandis pursuant to the proviso to Article 28 (4)) shall be subject to an administrative fine not exceeding 50 million won: (Amended by Act nº 12837, Oct. 15, 2014; Act nº 14828, Apr. 18, 2017)

1. A person who fails to either perform his/her duties with the due care of a good manager or comply with the standards determined by the Financial Services Commission, in violation of Article 21 (1) or (2);

2. A person who uses the name ‘electronic currency’, in violation of Article 36;

3. A person who refuses, obstructs or evades an inspection, data submission, a request for attendance and an investigation under Article 39 (3) (including cases where Article 39 (3) applies mutatis mutandis in Article 29 (2)) or Article 40 (3) and (4);

4. A person who fails to submit a report or submits a false report, in violation of Article 42 (1).

(2) Any of following persons (including a person issuing an electronic prepayment means applicable mutatis mutandis pursuant to Article 28 (4), in cases falling under subparagraph 2) shall be subject to an administrative fine not exceeding 20 million won: (Amended by Act nº 12837, Oct. 15, 2014; Act nº 14828, Apr. 18, 2017)

1. A person who fails to have the payment of electronic funds transfer take effect, in violation of Article 13 (2);

2. A person who fails to appoint the chief information security officer or appoint an executive officer as the chief information security officer, in violation of Article 21-2 (1) or (2);

3. A person who has the chief information security officer concurrently perform duties in the information technology sector other than those under Article 21-2 (4) or himself/herself concurrently performs duties in such sector, in violation of paragraph (3) of that Article;

4. A person who fails to analyze and assess the vulnerabilities of the electronic financial infrastructure, in violation of Article 21-3 (1);

5. A person who fails to formulate and implement a plan for complying with complementary measures, in violation Article 21-3 (2);

6. A person who fails to destroy any record of electronic financial transactions, in violation of Article 22 (2);

7. A person who makes a re-entrustment to a third party, in violation of Article 40 (6).

(3) Any of the following persons (including any person issuing an electronic prepayment means applicable mutatis mutandis pursuant to Article 28 (4), in cases falling under subparagraphs 1, 6 through 8, and 10) shall be punished by an administrative fine not exceeding ten million won: (Amended by Act nº 14828, Apr. 18, 2017)

1. Any person who fails to deliver a document stating the details of a transaction, in violation of Article 7 (2);

2. Any person who fails to inform the relevant user of the causes of an error and results of correction, in violation of Article 8 (2) and (3);

3. Any person who transfers an electronic prepayment means or electronic currency to a third party or provides it as a security, in violation of Article 18 (2);

4. Any person who fails to submit a plan for the information technology sector, in violation of Article 21 (4);

5. Any person who fails to report the findings from analysis and assessment of vulnerability in electronic financial infrastructure, in violation of Article 21-3 (1);

6. Any person who fails to inform the Financial Services Commission of an infringement incident, in violation of Article 21-5 (1);

7. Any person who fails to create or keep records in violation of Article 22 (1) (including where it is applicable mutatis mutandis under Article 29 (2));

8. Any person who fails to clarify, explain, deliver, publish or notify the terms and conditions, in violation of Article 24 (1) or (3);

9. Any person who fails to report to the Financial Services Commission, in violation of Article 25 (1);

10. Any person who fails to prepare the procedures for the settlement of disputes, in violation of Article 27 (1);

11. Deleted (By Act nº 14828, Apr. 18, 2017)

12. Any person who fails to keep separate accounts by the category of business provided for in Article 28 (1) and (2), in violation of Article 42 (1).

(4) The administrative fines under paragraphs (1) through (3) shall be imposed and collected by the Financial Services Commission, as prescribed by Presidential Decree. (Amended by Act nº 14828, Apr. 18, 2017)

(Article Amended by Act nº 11814, May 22, 2013)

ADDENDA

Article 1 (Enforcement Date)

This Act shall enter into force on January 1, 2007.

Article 2 (Transitional Measures concerning Means of Access, etc.)

The means of access and electronic payment means issued as at the time this Act enters into force shall be deemed to have been issued pursuant to this Act.

Article 3 (Transitional Measures concerning Permission and Registration)

(1) Any person who is engaged in issuing or managing electronic currency as at the time this Act enters into force shall obtain permission therefor from the Financial Supervisory Commission pursuant to Article 28 (1) within three months from the date when this Act takes effect.

(2) Any person who is engaged in performing electronic funds transfer services, the issuance and management business of electronic debit payment means or electronic prepayment means or electronic payment settlement agency services, etc. as at the time this Act enters into force shall file a registration with the Financial Supervisory Commission pursuant to Article 28 (2) within six months from the date when this Act takes effect.

(3) Any person who is engaged in the business of electronic bond management agency as at the time this Act enters into force shall file a registration with the Financial Supervisory Commission pursuant to Article 29 within three months from the date when this Act takes effect.

Article 4 Omitted.

ADDENDA (Act nº 8387, Apr. 27, 2007)

Article 1 (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation.

Articles 2 through 9 Omitted.

ADDENDA (Act nº 8863, Feb. 29, 2008)

Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation.

Articles 2 though 5 Omitted.

ADDENDUM (Act nº 9325, Dec. 31, 2008)

This Act shall enter into force three months after the date of its promulgation.

ADDENDA (Act nº 10303, May 17, 2010)

Article 1 (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)

Articles 2 though 10 Omitted.

ADDENDUM (Act nº 11087, Nov. 14, 2011)

This Act shall enter into force six months after the date of its promulgation.

ADDENDA (Act nº 11407, Mar. 21, 2012)

Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)

Articles 2 and 3 Omitted.

ADDENDA (Act nº 11461, Jun. 1, 2012)

Article 1 (Enforcement Date)

This Act shall enter into force three months after the date of its promulgation.

Articles 2 through 10 Omitted.

ADDENDA (Act nº 11814, May 22, 2013)

Article 1 (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation.

Article 2 (Applicability to Submission of Plans for Information Technology Sector)

The submission of a plan for the information technology sector under the amended provisions of Article 21 (4) shall begin to apply from the business year beginning after this Act enters into force.

Article 3 (Transitional Measures concerning Penalty Provisions and Administrative Fines)

The application of penalty provisions and the imposition of administrative fines for violations committed before this Act enters into force shall be governed by the former provisions.

ADDENDA (Act nº 12837, Oct. 15, 2014)

Article 1 (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation: Provided, That the amended provisions of Articles 13 (2) and 21 (2) and (3) shall enter into force one year after the date of its promulgation.

Article 2 (Applicability to Prohibition against Concurrent Position of Chief Information Security Officers)

The amended provisions of Article 21-2 (3) shall apply beginning with the first chief information security officer appointed (including cases where he/she is reappointed) after this Act enters into force.

Article 3 (Applicability to Prohibition against Re-Entrustment of Duties Related to Information Protection)

The amended provisions of Article 40 (6) shall apply beginning with the first case where any duty is re-entrusted or a re-entrustment period is extended after this Act enters into force.

Article 4 (Applicability to Imposition of Penalty Surcharges)

The amended provisions of Article 46 (1) shall apply beginning with the first financial company or electronic financial business entity who commits any violation after this Act enters into force.

Article 5 (Transitional Measures concerning Penalty Provisions and Administrative Fines)

The application of penalty provisions and the imposition of an administrative fine for any violation committed before this Act enters into force shall be governed by the former provisions of this Act.

ADDENDA (Act nº 13069, Jan. 20, 2015)

Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation.

Article 2 (Transitional Measures concerning Penalty Provisions)

The application of penalty provisions to any violation committed before this Act enters into force shall be governed by the former provisions of this Act.

ADDENDUM (Act nº 13929, Jan. 27, 2016)

This Act shall enter into force on the date of its promulgation: Provided, That the amended provisions of Article 6-2 shall enter into force six months after the date of its promulgation.

ADDENDUM (Act nº 14132, Mar. 29, 2016)

This Act shall enter into force three months after the date of its promulgation.

ADDENDA (Act nº 14828, Apr. 18, 2017)

Article 1 (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation.

Article 2 (Applicability to Notification of Details of Measures against Retired Executive Officer)

The amended provisions of Article 39-2 shall also apply to the executive officers and employees who have committed an violation before this Act enters into force, but resign or retire thereafter.

Article 3 (Transitional Measures concerning Demand for Suspension of Performance of Duties)

Notwithstanding the amended provisions of Article 39 (6) 4 (limited to the suspension of performance of duties), the former provision shall apply to the violations committed before this Act enters into force.

ADDENDA (Act nº 14839, Jul. 26, 2017)

Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation: Provided, That among the Acts amended pursuant to Article 5 of the Addenda, amendments to the Acts which have been promulgated before this Act enters into force, but the enforcement dates of which have not yet arrive, shall enter into force on the enforcement dates of the relevant Acts, respectively.

Articles 2 through 6 Omitted.

05Nov/21

Act nº 10166, Mar. 22, 2010. Telecommunications Business Act

Act nº 10166, Mar. 22, 2010. Telecommunications Business Act (Amended by Act nº 10656, May 19, 2011, Act nº 11201, Jan. 17, 2012).

CHAPTER I.- GENERAL PROVISIONS

Article 1 (Purposes)

The purpose of this Act is to contribute to the promotion of public welfare by encouraging sound development of the telecommunications business and ensuring convenience to the users of the telecommunications business through proper management of such business and efficient operation of telecommunications.

Article 2 (Definitions)

The terms used in this Act shall be defined as follows: (Amended by Act nº 10656, May 19, 2011)

1. The term “telecommunications” means any transmission or reception of signs, signals, writing, sounds and images by wire, radio, optics or other electromagnetic systems;

2. The term “telecommunications equipment and facilities” means equipment and facilities necessary for telecommunications, such as machinery, appliances, lines, etc.;

3. The term “telecommunications line equipment and facilities” means equipment and facilities which constitute communications channels between transmission and reception points for telecommunications among the telecommunications equipment and facilities, such as the transmission and line equipment and facilities, exchange facilities installed as one body of the transmission and line equipment and facilities, and all facilities attached thereto;

4. The term “commercial telecommunications equipment and facilities” means telecommunications equipment and facilities to be provided for tele communications business;

5. The term “private telecommunications equipment and facilities” means telecommunications equipment and facilities, other than commercial telecommunications equipment and facilities, installed by an individual to be used for his/her own telecommunications;

6. The term “telecommunications services” means services to advocate a third party’s communications through telecommunications equipment and facilities or to provide telecommunications equipment and facilities for a third party’s communications;

7. The term “telecommunications business” means any business which provides telecommunications services;

8. The term “telecommunications business operator” means an entity that provides telecommunications services upon obtaining a license, or completing registration or reporting (including cases of exemption from reporting) under this Act;

9. The term “user” means a person who concludes a contract for the use of telecommunications services with a telecommunications business operator in order to procure telecommunications services;

10. The term “pervasive services” means basic telecommunications services which any user may use at reasonable fees regardless of time and place;

11. The term “common telecommunications services” means telecommunications services for transmitting or receiving sounds, data, images, etc. without any change in the form or contents thereof and to lease telecommunications line equipment and facilities for the use of transmission or reception of sounds, data, images, etc., such as telephone services or Internet services: Provided, That this shall not include telecommunications services (referring to detailed independent services among telecommunications services under subparagraph 6; hereinafter the same shall apply) determined and publicly announced by the Korea Communications Commission;

12. The term “value-added telecommunications services” means telecommunications services, other than common telecommunications services:

13. The term “special value-added telecommunications services” shall be as follows:

(a) Value-added telecommunications services provided by a special on-line service provider under Article 104 of the Copyright Act;

(b) Other value-added telecommunications services for the purpose of storing and transmitting, or transmitting information under subparagraph 1 of Article 3 of the Framework Act on National Informatization by using computers among others.

Article 3 (Duties to Provide Services, etc.)

(1) No telecommunications business operator may refuse to provide any telecommunications service, without justifiable grounds.

(2) A telecommunications business operator shall perform his/her business in a fair, swift and accurate manner.

(3) Fees for telecommunications services shall be reasonably determined so as to ensure the efficient development of the telecommunications business and to provide users with convenient and various telecommunications services fairly and inexpensively.

Article 4 (Provision, etc. of Pervasive Services)

(1) Each telecommunications business operator shall have obligations to provide pervasive services or to compensate for losses incurred therefrom.

(2) Notwithstanding paragraph (1), the Korea Communications Commission may release any of the following telecommunications business operators from the obligations mentioned under paragraph (1):

1. A telecommunications business operator, prescribed by Presidential Decree, for whom the imposition of obligations under paragraph (1) is deemed inadequate in consideration of the nature of telecommunications services;

2. A telecommunications business operator whose profits from telecommunications services is not more than the amounts determined by Presidential Decree within 1/100 of the total profits from all telecommunications services.

(3) Details of pervasive services shall be determined by Presidential Decree in consideration of the following matters:

1. Level of the development of information and communications technology;

2. Level of the dissemination of telecommunications services;

3. Public interest and safety;

4. Promotion of social welfare;

5. Acceleration of informatization.

(4) In order to provide pervasive services in an efficient and stable manner, the Korea Communications Commission may, according to standards and procedures prescribed by Presidential Decree, designate a telecommunications business operator who provides pervasive services, taking into account the scope, quality and level of fees of pervasive services, and the technical capability of the telecommunications business operator.

(5) The Korea Communications Commission may distribute the burden of compensation for losses incurring from providing pervasive services to telecommunications business operators, based on their profits, in accordance with the methods and procedures prescribed by Presidential Decree.

CHAPTER II.- TELECOMMUNICATIONS BUSINESS

SECTION 1.- General Provisions

Article 5 (Classification, etc. of Telecommunications Businesses)

(1) The telecommunications business shall be classified into the common telecommunications business, special category telecommunications business and value-added telecommunications business.

(2) The common telecommunications business shall install telecommunications line equipment and facilities, and thereby provide telecommunications services.

(3) The special category telecommunications business shall be as follows:

1. Business that provides common telecommunications services by using telecommunications line equipment and facilities, etc. of a person who has obtained a license for the common telecommunications business under Article 6 (hereinafter referred to as “common telecommunications business“);

2. Business that installs telecommunications equipment and facilities in the premises prescribed by Presidential Decree, and provides telecommunications services therein by using such equipment and facilities.

(4) The value-added telecommunications business shall provide value-added telecommunications services.

SECTION 2.- Common Telecommunications Business

Article 6 (Licenses, etc. for Common Telecommunications Business)

(1) A person who intends to operate the common telecommunications business shall obtain a license from the Korea Communications Commission.

(2) When granting a license under paragraph (1), the Korea Communications Commission shall comprehensively examine the following matters:

1. Financial capability to implement plans for providing common telecommunications services;

2. Technical capability to implement plans for providing common telecommunications services;

3. Adequacy of plans for protecting users;

4. Other matters prescribed by Presidential Decree concerning capabilities necessary for the stable provision of common telecommunications services.

(3) The Korea Communications Commission shall establish detailed criteria for examination by subject matter to be examined, under paragraph (2), a period for granting licenses and guidelines for application for licenses, and publicly announce them.

(4) When granting a license for the common telecommunications business under paragraph (1), the Korea Communications Commission may place necessary conditions to facilitate fair competition, protect users, improve service quality and efficiently utilize information and telecommunications resources. In such cases, details of such conditions shall be published on the Official Gazette or posted on the web site.

(5) A license under paragraph (1) shall be granted only to a corporation.

(6) Procedures for granting licenses under paragraph (1) and other necessary matters shall be determined by Presidential Decree.

 Article 7 (Grounds for Disqualification of Licenses)

No person falling under any of the following subparagraphs shall be entitled to obtain a license for the common telecommunications business under Article 6:

1. The State or local governments;

2. Foreign governments or foreign corporations;

3. Corporations, stocks of which are held by foreign governments or foreigners in excess of the limitation on stock holdings referred to in Article 8 (1).

Article 8 (Limitation on Stock Holdings by Foreign Governments or Foreigners)

(1) A foreign government or foreigner may hold stocks of the common telecommunications business (excluding non-voting stocks under Article 370 of the Commercial Act, but including voting stock equivalents, such as security depositary receipts, and equity shares; hereinafter the same shall apply) within 49/100 of the total number of outstanding stocks of the common telecommunications business, when aggregating all of those held by foreign governments or foreigners.

(2) Where a foreign government or foreigner (including a specially related person under Article 9 (1) 1 of the Financial Investment Services and Capital Markets Act; hereinafter the same shall apply) holds 15/100 or more of the total number of outstanding stocks of a corporation and is the largest shareholder under Article 9 (1) 1 of the Financial Investment Services and Capital Markets Act, such corporation shall be deemed as a foreign corporation (hereinafter referred to as “deemed-foreign corporation“).

(3) Any corporation which holds less than 1/100 of the total number of outstanding stocks of the common telecommunications business may not be deemed as a foreign corporation, even if it satisfies the requirements under paragraph (2).

Article 9 (Grounds for Disqualification as Executives)

(1) Any person falling under any of the following subparagraphs shall be disqualified as an executive of any common telecommunications business operator:

1. A minor, or an incompetent or quasi-incompetent person;

2. A person who is not yet reinstated after having been declared bankrupt by a court;

3. A person in whose case three years have not passed since he/she had been sentenced to imprisonment without prison labor or heavier punishment for a violation of this Act, the Framework Act on Telecommunications, the Radio Waves Act or the Act on Promotion of Information and Communications Network Utilization and Information Protection, etc. (excluding matters not directly related to the telecommunications business; hereinafter referred to as “this Act, etc.”), and the execution of the punishment was completed (including cases that the execution is deemed to have been completed) or he/she was exempted from the enforcement of the sentence;

4. A person who was sentenced to a suspended execution of imprisonment without prison labor or heavier punishment for a violation of this Act, etc. and is still under the period of suspension;

5. A person in whose case one year has not passed since he/she had been sentenced to a fine for a violation of this Act, etc.;

6. A person in whose case three years have not passed since he/she has been subject to a disposition to fully or partially cancel his/her license in accordance with Article 20 (1), a disposition to fully or partially revoke his/her registration in accordance with Article 27 (1) or an order to fully or partially discontinue the business in accordance with Article 27 (2). In cases of a corporation, “person” refers to a person who causes cancellation of its license, revocation of its registration or an order to discontinue the business, and its representative.

(2) Where any executive falls under any subparagraph of paragraph (1) or is found to fall under any subparagraph of paragraph (1) at the time he/she is appointed as an executive, he/she shall duly resign from office.

(3) Any activity in which any executive has been involved prior to his/her resignation under paragraph (2) may not lose its legal effect.

Article 10 (Examination on Public Benefits of Possession, etc. of Stocks by Common Telecommunications Business)

(1) A Public Benefit Examination Committee (hereinafter referred to as the “Committee“) shall be established in the Korea Communications Commission in order to examine as to whether any of the following cases impairs public interests prescribed by Presidential Decree (hereinafter referred to as “examination on public benefits“), such as national security, public safety and maintenance of order:

1. Where a person holds not less than 15/100 of the total number of outstanding stocks of the common telecommunications business, including those stocks held by a specially related person under Article 9 (1) 1 of the Financial Investment Services and Capital Markets Act (hereinafter referred to as “specially related person“);

2. Where the largest stockholder of the common telecommunications business changes;

3. Where the common telecommunications business operator or any stockholder of a common telecommunications business concludes a contract with a foreign government or a foreigner for important managerial matters prescribed by Presidential Decree, such as the appointment and dismissal of executives and the transfer or acquisition of business;

4. Where any stockholder who has de facto management rights for the common telecommunications business changes, as prescribed by Presidential Decree

(2) Where a common telecommunications business operator or any stockholder of the common telecommunications business falls under paragraph (1), he/she shall report thereon to the Korea Communications Commission within 30 days from the date when such case occurs.

(3) Where a common telecommunications business operator or any stockholder of the common telecommunications business falls under paragraph (1), he/she may request the Korea Communications Commission to examine public benefits before such case occurs.

(4) Where the Korea Communications Commission has received reporting under paragraph (2) or a request for examination under paragraph (3), it shall refer such matters to the Committee for deliberation.

(5) Where the Korea Communications Commission determines as a result of examination on public benefits under paragraph (1) that the cases under any subparagraph of paragraph (1) are likely to impair public interests, it may issue an order to modify the details of a contract, suspend the implementation of a contract, suspend the exercise of voting rights, or sell relevant stocks.

(6) The scope of common telecommunications business operators who shall report or may request an examination on public benefits pursuant to paragraph (2) or (3), procedures for reporting and examinations on public benefits and other necessary matters shall be prescribed by Presidential Decree.

Article 11 (Organization, Operation, etc. of the Committee)

(1) The Committee shall consist of not less than five but not more than 10 members, including one chairperson.

(2) The Vice Chairperson of the Korea Communications Commission shall hold office as the chairperson, and members shall be commissioned by the chairperson, from among public officials ranking Grade III of the relevant central administrative agencies prescribed by Presidential Decree, public officials in general service belonging to the Senior Civil Service, and those falling under any of the following persons:

1. Persons who have advanced knowledge and career backgrounds in information and communications;

2. Persons recommended by Government-funded research institutes which is related to the national security, public safety or maintenance of order;

3. Persons recommended by nonprofit, non-governmental organizations referred to in Article 2 of the Assistance for Non-profit, Non-Governmental Organizations Act;

4. Other persons deemed necessary by the chairperson.

(3) The Committee may conduct investigations necessary for the examination on public benefits, or request an interested party or a reference witness to provide necessary data. In such cases, the relevant interested party or reference witness shall comply with such request unless justifiable grounds exist.

(4) Where the Committee deems it necessary, it may require an interested party or a reference witness to appear at a Committee meeting and state his/her opinions. In such cases, the relevant interested party or reference witness shall appear at a Committee meeting unless justifiable grounds exist.

(5) Matters necessary for the organization, operation, etc. of the Committee shall be prescribed by Presidential Decree.

Article 12 (Restrictions, etc. on Excess Stock Holdings)

(1) Where a foreign government or a foreigner has acquired stocks in violation of Article 8 (1), it or he/she shall not exercise the voting rights in the excess stocks.

(2) The Korea Communications Commission may order a stockholder who has acquired stocks in violation of Article 8 (1), a common telecommunications business operator to which the stockholder belongs, or a stockholder of the deemed-foreign corporation to correct the violation within a period up to six months.

(3) Any person in receipt of a corrective order under paragraph (2) shall correct the violation within a specified period.

(4) Where a stockholder has acquired stocks in violation of Article 8 (1), a common telecommunications business operator may refuse to renew the register of stockholders or register of members to record the excess portion.

Article 13 (Charges for Compelling Compliance)

(1) The Korea Communications Commission may impose a charge for compelling compliance, on a person who has been subjected to the order referred to in Article 10 (5), 12 (2) or 18 (8) (hereinafter referred to as “corrective order“) and fails to comply with such order within a specified period. In such cases, the charge for compelling compliance leviable daily shall not be more than 3/1,000 of the purchase price of stocks held by such person, but in cases not related with stock holdings, it shall not exceed 100 million won.

(2) A period for which charges for compelling compliance are imposed pursuant to paragraph (1) shall be from the date following the date the period prescribed by the corrective order expires to the date the corrective order is complied with. In such cases, the charge for compelling compliance shall be imposed within 30 days from the date following the date the period prescribed by the corrective order expires, in the absence of special grounds.

(3) The provisions of Article 53 (5) shall apply mutatis mutandis to the surcharge on compelling compliance.

(4) Matters necessary for the imposition, payment, refund, etc. of charges for compelling compliance shall be prescribed by Presidential Decree.

Article 14 (Issuance of Stocks)

Where a common telecommunications business operator issues stocks, such stocks shall be registered.

Article 15 (Obligation to Commence Business)

(1) A common telecommunications business operator shall install telecommunications equipment and facilities and commence the business within the period prescribed by the Korea Communications Commission.

(2) Where a common telecommunications business operator fails to commence the business within the period under paragraph (1) due to natural disasters or other unavoidable circumstances, the Korea Communications Commission may extend the relevant period only once, upon an application from the common telecommunications business operator.

Article 16 (Modification of Licenses)

(1) Where a common telecommunications business operator intends to modify the importance matters prescribed by Presidential Decree among the matters of his/her license under Article 6, he/she shall obtain a revised license from the Korea Communications Commission, as prescribed by Presidential Decree.

(2) The provisions of Articles 6 (4) and 15 shall apply mutatis mutandis to a revised license pursuant to paragraph (1).

Article 17 (Concurrent Management of Business)

(1) Where a common telecommunications business operator intends to manage any of the following businesses, he/she shall obtain approval from the Korea Communications Commission: Provided, That this may not apply to a common telecommunications business operator whose profits do not exceed 30 billion won:

1. Communications equipment manufacturing business;

2. Information and communications construction business (excluding any improvement and integration business of telecommunications networks) under subparagraph 3 of Article 2 of the Information and Communications Construction Business Act;

3. Service business (excluding any improvement and integration business of telecommunications networks) under subparagraph 6 of Article 2 of the Information and Communications Construction Business Act.

(2) The Korea Communications Commission shall grant approval under paragraph (1) if it deems that the common telecommunications business is unlikely to impede the management of the telecommunications business due to the management of the business under paragraph (1), and that it is necessary for the development of telecommunications.

Article 18 (Acquisition of Business and Merger of Corporations, etc.)

(1) Any person falling under any of the following subparagraphs shall obtain authorization from the Korea Communications Commission, as prescribed by Presidential Decree: Provided, That where the person sells telecommunications line equipment and facilities, except major telecommunications line equipment and facilities prescribed by Presidential Decree, he/she shall report thereon to the Korea Communications Commission, as prescribed by Presidential Decree, notwithstanding the provisions of subparagraph 3:

1. Any person who intends to fully or partially acquire the business of a common telecommunications business operator;

2. Any person who intends to merge with a corporate common telecommunications business;

3. Any common telecommunications business operator who intends to sell the telecommunications line facilities necessary for providing licensed common telecommunications services;

4. Any person who intends to hold not less than 15/100 of the total number of outstanding stocks of a common telecommunications business, or to become the largest stockholder of a common telecommunications business, including those stocks held by a specially related person;

5. Any person who intends to acquire stocks of a common telecommunications business operator or conclude an agreement with a common telecommunications business operator with the intent to exercise dominant influence over the right of the common telecommunications business operator to manage the business, as prescribed by Presidential Decree;

6. Any common telecommunications business operator who intends to establish a corporation to partially provide licensed common telecommunications services.

(2) Where the Korea Communications Commission intends to grant authorization under paragraph (1), it shall comprehensively examine the following matters:

1. Appropriateness of financial, technical and managerial capabilities;

2. Appropriateness of the management of information and communications resources, such as frequencies and telecommunications numbers;

3. Influence over competition among common telecommunications business operators;

4. Protection of users;

5. Utilization of telecommunications equipment and facilities and communications networks, efficiency of research and development, and influence over public benefits, such as international competitiveness of the telecommunications industry.

(3) Matters necessary for the detailed guidelines for examinations for each subject matter and procedures for examinations under paragraph (2) shall be determined and publicly announced by the Korea Communications Commission.

(4) Any person falling under any of the following subparagraphs shall succeed to the status of the relevant common telecommunications business operator which is related to his/her license:

1. Any person who acquires the common telecommunications business by obtaining authorization under paragraph (1) 1;

2. Any corporation which survived a merger or has been newly established in the course of a merger by obtaining authorization under paragraph (1) 2;

3. Any corporation which is established to partially provide common telecommunications services by obtaining authorization under paragraph (1) 6.

(5) The Korea Communications Commission may place conditions provided for in Article 6 (4) when granting authorization under paragraph (1).

(6) The Korea Communications Commission shall consult with the Fair Trade Commission when intending to grant authorization under paragraph (1).

(7) The provisions of Article 7 shall apply mutatis mutandis to the grounds for disqualification of authorization under paragraph (1).

(8) Where a person falling under paragraph (1) 4 or 5 fails to obtain authorization referred to in paragraph (1), the Korea Communications Commission may order him/her to suspend the exercise of the voting right or to sell the relevant stocks and, where such person fails to comply with the conditions under paragraph (5), issue an order to comply with such conditions within a specified period set by it.

(9) Any person who intends to obtain authorization under paragraph (1) shall be prohibited from engaging in the following conducts, prior to obtaining such authorization:

1. Integration of telecommunications networks;

2. Appointment of executives;

3. Acquisition of business, or execution of agreements for merger or sales of equipment and facilities;

4. Follow-up measures for the establishment of a company.

(10) Where any person falling under paragraph (1) is subject to the examination on public benefits, he/she may present the documents required to be submitted for the examination on public benefits, when applying for authorization under paragraph (1).

Article 19 (Suspension or Discontinuation of Business)

(1) Where a common telecommunications business operator intends to fully or partially suspend or discontinue his/her common telecommunications business, he/she shall notify users by not later than 60 days before the scheduled date of such suspension or discontinuance and obtain approval therefor from the Korea Communications Commission.

(2) Where the Korea Communications Commission deems it necessary to protect users in a separate means due to the suspension or discontinuation of the common telecommunications business, it may order the relevant common telecommunications business operator to take necessary measures for the protection of users, such as the vicarious execution of subscription change, payment of expenses incurred therein or cancellation of subscription.

(3) Where the Korea Communications Commission is in receipt of an application for approval under paragraph (1) and deems that the suspension or discontinuation of the relevant business threatens to impair public benefits, it shall not grant such approval.

Article 20 (Cancellation, etc. of Licenses)

(1) Where a common telecommunications business operator falls under any of the following subparagraphs, the Korea Communications Commission may fully or partially cancel his/her license or issue an order to fully or partially suspend business operation for up to one year:

1. Where he/she obtains a license by fraudulent or other illegal means;

2. Where he/she fails to satisfy the conditions under Articles 6 (4) and 18 (5);

3. Where he/she fails to comply with an order under Article 12 (2);

4. Where he/she fails to commence business within a period prescribed by Article 15 (1) (referring to an extended period, if such period is extended under paragraph (2) of the same Article);

5. Where he/she fails to comply with the terms and conditions of use, which are authorized or reported under Article 28 (1) and (2);

6. Where he/she fails to comply with an order under Article 52 (1) or a corrective order under Article 92 (1) without any justifiable ground.

(2) Guidelines and procedures for the dispositions under paragraph (1) and other necessary matters shall be prescribed by Presidential Decree.

SECTION 3 .- Special Category Telecommunications Business and Value-Added Telecommunications Business

Article 21 (Registration of Special Category Telecommunications Business)

(1) Any person who intends to operate the special category telecommunications business shall satisfy the following conditions and file for registration (including any registration through an information and telecommunications network) with the Korea Communications Commission, as prescribed by Presidential Decree:

1. Financial and technical capabilities;

2. Plans for protecting users;

3. Business plans, etc. and other matters prescribed by Presidential Decree.

(2) The Korea Communications Commission in receipt of registration for the special category telecommunications business under paragraph (1) may place necessary conditions to facilitate fair competition, protect users, improve service quality, efficiently utilize information and telecommunications resources.

(3) Any registration for the special category telecommunications business under paragraph (1) shall be granted only to a corporation.

(4) Any person who has completed registration for the special category telecommunications business (hereinafter referred to as “special category telecommunications business operator”) shall commence his/her business within one year after the date he/she has completed such registration.

(5) Requirements, procedures and other necessary matters for the registration under paragraph (1) shall be prescribed by Presidential Decree.

Article 22 (Reporting, etc. on Value-Added Telecommunications Business)

(1) Any person who intends to operate the value-added telecommunications business shall report (including cases of reporting through information and telecommunications networks) to the Korea Communications Commission, in accordance with conditions and procedures prescribed by Presidential Decree. In such cases, a small-scale value-added telecommunications business operator shall be deemed to have reported if he/she meets the standards for capital, etc. prescribed by Presidential Decree.

(2) Notwithstanding the provisions of paragraph (1), any person who intends to conduct special value-added telecommunications business shall register (including registration through an information and communications network) with the Korea Communications Commission along with the following: (Inserted by Act nº 10656, May 19, 2011)

1. An implementation plan to take technical measures to comply with the provisions of Articles 42, 42-2, 42-3 and 45 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, etc. and Article 104 of the Copyright Act;

2. Human resources and physical facilities necessary to conduct affairs;

3. Financial soundness;

4. Other matters prescribed by Presidential Decree, such as a business plan.

(3) Where the Korea Communications Commission accepts the registration of value-added telecommunications business pursuant to paragraph (2), it may attach conditions necessary for the implementation of a plan under subparagraph 1 of the same paragraph thereto. (Inserted by Act nº 10656, May 19, 2011)

(4) Where a common telecommunications business operator intends to operate the value-added telecommunications business, he/she shall be deemed to have reported thereon. (Amended by Act nº 10656, May 19, 2011)

(5) Any person who has reported on value-added telecommunications business pursuant to the forepart of paragraph (1) and any person who has registered value-added telecommunications business pursuant to paragraph (2) shall commence his/her business within one year after he/she reports or registers such business. (Amended by Act nº 10656, May 19, 2011)

(6) A report under the forepart of paragraph (1), requirements and procedures for registration under paragraph (2), and other necessary matters shall be prescribed by Presidential Decree. (Inserted by Act nº 10656, May 19, 2011)

Article 22-2 (Disqualifications for Registration)

Any individual or corporation, for whom three years have not passed from the date the registration thereof is cancelled pursuant to Article 27 (2), or a person who is a major stockholder (referring to an investor prescribed by Presidential Decree) of such corporation at the time of such cancellation shall not conduct registration under Article 22 (2).

(Article Inserted by Act nº 10656, May 19, 2011)

Article 23 (Modification of Registered or Reported Matters)

Where any special category telecommunications business operator or any person who has reported on the value-added telecommunications business pursuant to the forepart of Article 22 (1) or any person who has registered value-added telecommunications business pursuant to paragraph (2) of the same Article intends to modify matters prescribed by Presidential Decree among registered or reported matters, he/she shall make a revised registration or a revised report (including cases of making a revised registration or a revised report through information and telecommunications networks) with the Korea Communications Commission, as prescribed by Presidential Decree. (Amended by Act nº 10656, May 19, 2011)

Article 24 (Transfer, Acquisition. etc. of Business)

Where any person transfers or acquires all or part of his/her special category telecommunications business or value-added telecommunications business, or a corporate special category telecommunications business operator or a corporate value-added telecommunications business operator (referring to a person who has reported value-added telecommunications business pursuant to the forepart of Article 22 (1), a person who has registered value-added telecommunications business pursuant to paragraph (2) of the same Article or a person deemed to have reported value-added telecommunications business pursuant to the latter part of paragraph (1) of the same Article or paragraph (4); hereinafter the same shall apply) is merged with another corporation or comes into an inheritance, any of the following persons shall report (including cases of reporting through information and telecommunications networks) to the Korea Communications Commission, in accordance with conditions and procedures prescribed by Presidential Decree: (Amended by Act nº 10656, May 19, 2011)

1. A person who acquires the relevant business;

2. A corporation which survived or has been newly established following the merger;

3. A person who inherits the relevant business.

Article 25 (Succession of Business)

Where any person transfers or acquires the special category telelcommunications business or the value-added telecommunications business, a corporate special category telecommunications business operator or a corporate value-added telecommunications business operator merges with another corporation, or any person inherits the value-added telecommunications business, pursuant to Article 24, a person who falls under any of the following subparagraphs shall succeed to the status of the preceding special category telecommunications business operator or the value-added telecommunications business operator:

1. A person who acquires the relevant business;

2. A corporation which survived or has been newly established in the course of the merger;

3. A person who inherits the relevant business.

Article 26 (Suspension, Discontinuation, etc. of Business)

(1) Where a special category telecommunications business operator or a value-added telecommunications business operator intends to fully or partially suspend or discontinue his/her business, he/she shall notify the users of the relevant telecommunications services of such suspension or discontinuation, and report (including cases of reporting through information and telecommunications networks) thereon to the Korea Communications Commission by not later than 30 days prior to the scheduled date of such suspension or discontinuation. In such cases, the duration of suspension of the business shall not exceed one year.

(2) Where a corporate special category telecommunications business operator or a corporate value-added telecommunications business operator is dissolved for a reason other than a merger, the relevant liquidator (referring to the trustee in bankruptcy, when such corporate business operator is dissolved by bankruptcy) shall promptly report thereon (including cases of reporting through information and telecommunications networks) to the Korea Communications Commission.

Article 27 (Cancellation of Business Registration, Order to Discontinue Business, etc.)

(1)          Where a special category telecommunications business operator falls under any of the following subparagraphs, the Korea Communications Commission may fully or partially cancel his/her business registration, or issue an order to fully or partially suspend the business operation for up to one year: Provided, That if he/she falls under subparagraph 1, the Korea Communications Commission shall fully or partially cancel his/her business registration:

1. Where he/she registers the business by fraudulent or other illegal means;

2. Where he/she fails to satisfy the conditions under Article 21 (2);

3. Where he/she fails to commence the business within one year from the date he/she has completed the business registration, in violation of Article 21 (4) or where he/she suspends the business operation for at least one year, in violation of the latter part of Article 26 (1);

4. Where he/she fails to comply with an order under Article 52 (1) or a corrective order under Article 92 (1) without justifiable grounds.

(2) Where a value-added telecommunications business operator falls under any of the following subparagraphs, the Korea Communications Commission may order him/her to discontinue all or part of his/her business (in cases of a special value-added telecommunication business operator, referring to the cancellation of all or part of registration) or to suspend all or part of his/her business operation for up to one year: Provided, That if he/she falls under subparagraph 1, the Korea Communications Commission shall order a partial or whole closure of the business: (Amended by Act nº 10656, May 19, 2011)

1. Where he/she reports or registers such business by fraudulent or other illegal means;

2. Where he/she fails to fulfill the conditions under Article 22 (3);

3. Where he/she fails to commence the business within one year from the date he/she reports or registers such business, in violation of Article 22 (5) or where he/she suspends the business operation for at least one year, in violation of the latter part of Article 26 (1);

4. Where he/she fails to comply with an order under Article 52 (1) or a corrective order under Article 92 (1) without justifiable grounds;

5. Where he/she fails to execute an order to take corrective measures under Article 64 (4) of the Act on Promotion of Information and Communications Network Utilization and Information Protection, etc.;

6. Where a person who has been subjected to the disposition of a fine for negligence not less than three times pursuant to Article 142 (1) and (2) 3 of the Copyright Act is subjected to the disposition of a fine for negligence again, in whose case the Minister of Culture, Sports and Tourism requests such disposition through deliberation by the Korea Copyright Commission under Article 112 of the same Act.

(3) Guidelines, procedures and other matters necessary for the dispositions under paragraph (1) or (2) shall be prescribed by Presidential Decree.

CHAPTER III.- TELECOMMUNICATIONS SERVICES

Article 28 (Reporting, etc. on Terms and Conditions of Use)

(1) A common telecommunications business operator shall determine the service charges and the terms and conditions of use for each service type he/she intends to provide (hereinafter referred to as “terms and conditions of use“), and report thereon (including cases of reporting modified matters; hereafter the same shall apply in this Article) to the Korea Communications Commission.

(2) Notwithstanding paragraph (1), in cases of common telecommunications services to be provided by a common telecommunications business operator who satisfies the standards prescribed by Presidential Decree, such as the scale of business and market share, the common telecommunications business operator shall obtain authorization (including revised authorization; hereafter the same shall apply in this Article) from the Korea Communications Commission: Provided, That if a common telecommunications business operator reduces the service charges which are stated in the terms and conditions of use already authorized, he/she shall report thereon to the Korea Communications Commission.

(3) In cases under the main sentence of paragraph (2), the Korea Communications Commission shall authorize the terms and conditions of use, if they satisfy the following requirements:

1. Telecommunications service charges shall be determined with reasonable consideration of the cost for supply, profits, classification of expenses and profits corresponding to each service, cost saving depending on the methods of service delivery, influence over fair competition environments, etc.;

2. They shall not put users at a disadvantage in terms of matters concerning the responsibility of common telecommunications business operators and relevant users or cost-sharing methods for installation works of telecommunications facilities and other works;

3. They shall not unfairly restrict the use of telecommunications line facilities by other telecommunications business operators or users;

4. They shall not unfairly discriminate specific persons;

5. They shall secure major telecommunications under Article 85, taking into consideration the efficient implementation of functions of the State.

(4) Any person who intends to report on the terms and conditions of use of telecommunications service or obtain authorization therefor under paragraphs (1) and (2) shall submit to the Korea Communications Commission the materials stating the basis of the calculation of telecommunications service charges (in cases of any alteration, including a comparative table on matters before and after the alteration), including subscription expenses, basic rates, user’s fees, additional service charges, actual expenses, etc.

(5) Necessary matters concerning the scope of and procedures for report or authorization, other than those under paragraphs (1) through (4), shall be prescribed by Presidential Decree.

Article 29 (Reduction or Exemption of Fees)

A common telecommunications business operator may reduce or exempt telecommunications service charges, as prescribed by Presidential Decree, to the extent necessary to sustain national security, disaster relief, social welfare, public interests, etc.

Article 30 (Restrictions on Use by Third Parties)

No person shall advocate a third party’s communications through telecommunications services provided by a telecommunications business operator or provide such services for a third party’s communications: Provided, That the same shall not apply in the following cases:

1. Where it is required to ensure the prevention and rescue from disaster, traffic and communications, and the supply of electricity, and to maintain order in a national emergency situation;

2. Where a person renders ancillary telecommunications services to clients while running his/her business other than the telecommunications business;

3. Where a person is allowed to use telecommunications services on a trial basis for the purpose of developing and marketing telecommunications equipment and facilities, such as terminal devices, etc. which enable to use the telecommunications services;

4. Where any user allows any third party to use telecommunications services to the extent that the latter does not use them repeatedly;

5. Where it is necessary for the public interests or where the use of telecommunications services do not impede the business operations by a telecommunications business, as prescribed by Presidential Decree.

Article 31 (Use of Transmission or Line Equipment and Facilities, etc.)

(1) Any composite cable TV business operator, transmission network business operator, or relay cable broadcasting business operator under the Broadcasting Act may permit common telecommunications business operators to use his/her own transmission or line equipment and facilities or cable broadcasting equipment and facilities in a manner prescribed by Presidential Decree.

(2) Where a common telecommunications business operator intends to provide value-added telecommunications services by using transmission or line equipment and facilities or cable broadcasting equipment and facilities owned by any composite cable TV business operator, transmission network business operator, or relay cable broadcasting business operator under the Broadcasting Act, he/she shall report thereon to the Korea Communications Commission pursuant to Article 22 (1).

(3) Articles 35 through 37, and 39 through 55 shall apply mutatis mutandis to a permit to use transmission or line equipment and facilities or cable broadcasting equipment and facilities pursuant to paragraph (1).

(4) Article 28 (2) through (7) of the Framework Act on Broadcasting Communications Development shall apply mutatis mutandis to the provision of services pursuant to paragraph (2).

Article 32 (Protection of Users)

(1) A telecommunications business operator shall promptly address the reasonable opinions or dissatisfactions raised by users with respect to telecommunications services. In such cases, if it is difficult to promptly address them, he/she shall notify the users of the reasons thereof and the schedule for treatment.

(2) Compensation for losses incurred by the occurrence of reasons causing the opinions or dissatisfactions under paragraph (1) and by the delay in addressing them shall be governed by Article 33.

(3) Where a telecommunications business operator who provides common telecommunications services intends to receive service charges from users in advance, prior to providing such telecommunications services, he/she shall purchase a guarantee insurance policy by which the person designated by the Korea Communications Commission is insured and which covers an amount calculated according to the guidelines prescribed by Presidential Decree within the total amount of advance service charges so as to compensate for losses suffered by users due to a failure to provide such telecommunications services: Provided, That a telecommunications business operator may choose not to purchase a guarantee insurance policy in any case prescribed by Presidential Decree taking into consideration the financial capability of the relevant telecommunications business operator, service charges, etc.

(4) Any insured person who has been designated under paragraph (3) shall pay the amount of coverage provided under a guarantee insurance policy referred to in paragraph (3) to the users, etc. who fail to receive telecommunications services after pre-paying service charges.

(5) Matters necessary for the purchase of guarantee insurance policies, renewal of guarantee insurance, procedures for paying insurance, etc. pursuant to paragraphs (3) and (4) shall be prescribed by Presidential Decree.

Article 32-2 (Notification of Excess, etc. of Limits on Charges)

(1) Where any telecommunications business operator who uses frequency allocated pursuant to the Radio Waves Act falls under any of the followings, he/she shall notify users of such fact:

1. Where he/she exceeds the limits on a charge for each telecommunications service on which he/she agreed with a user at the beginning;

2. Where a charge is imposed following the use of international telecommunications service, such as international telephone service.

(2) Matters necessary for objects, methods, etc. of a notification under paragraph (1) shall be determined and announced by the Korea Communications Commission.

(Article Inserted by Act nº 11201, Jan. 17, 2012)

Article 33 (Compensation for Losses)

A telecommunications business operator shall compensate for any losses suffered by a user when he/she has caused such losses in the course of providing telecommunications services: Provided, That if such loss results from a force majeure event or such user causes such losses on purpose or by gross negligence, the liability for compensation for the relevant losses shall be mitigated or exempted.

CHAPTER IV.- PROMOTION OF COMPETITION IN TELECOMMUNICATIONS BUSINESS

Article 34 (Promotion of Competition)

(1) The Korea Communications Commission shall endeavor to establish an efficient competition system and to promote environments of fair competition in the telecommunications business.

(2) The Korea Communications Commission shall appraise the conditions of competition in the common telecommunications business every year for the purpose of developing competition policies to establish an efficient competition system and to promote environments of fair competition in the telecommunications business under paragraph (1).

(3) The detailed guidelines, procedures and methods for appraising competition conditions under paragraph (2) and other necessary matters shall be prescribed by Presidential Decree.

Article 35 (Provision of Equipment and Facilities)

(1) Where a telecommunications business operator requests a common telecommunications business operator or an authority that constructs, operates or manages roads, railroads, subways, water and sewage systems, electrical equipment, telecommunications line equipment and facilities, etc. (hereinafter referred to as “facility management authority“) to provide him/her with ducts, common utility conduits, poles, cables, stations, or other equipment (including telecommunications equipment and facilities; hereinafter the same shall apply) or facilities (hereinafter referred to as “equipment and facilities“), such common telecommunications business operator or such facility management authority may provide equipment and facilities by contract with him/her.

(2) Any of the following common telecommunications business operators or facility management authorities shall provide equipment and facilities by contract, notwithstanding the provisions of paragraph (1): Provided, That this shall not apply in cases where a facility management authority plans to use such equipment and facilities;

1. A common telecommunications business operator who possesses equipment and facilities indispensable for other telecommunications business operators to provide telecommunications services;

2. Any of the following facility management authorities who possess equipment and facilities, such as ducts, common utility conduits, or poles:

(a) Korea Highway Corporation established under the Korea Highway Corporation Act;

(b) Korea Water Resources Corporation established under the Korea Water Resources Corporation Act;

(c) Korea Electric Power Corporation established under the Korea Electric Power Corporation Act;

(d) Korea Rail Network Authority established under the Korea Rail Network Authority Act;

(e) A local public enterprise under the Local Public Enterprises Act;

(f) A local government under the Local Autonomy Act;

(g) A regional construction management administration under the Road Act;

3. A common telecommunications business operator or facility management authority whose scale of the business, market share, etc. of common telecommunications services meet the standards prescribed by Presidential Decree.

(3) The Korea Communications Commission shall establish and publicly announce the scope of equipment and facilities under paragraphs (1) and (2) and the guidelines for the conditions, procedures, methods and calculation of prices for providing such equipment and facilities. In such cases, the scope of equipment and facilities to be provided under paragraph (2) shall be determined in consideration of the demand for equipment and facilities by common telecommunications business operators or facility management authorities falling under any subparagraph of the same paragraph.

(4) A telecommunications business operator who has been provided with equipment and facilities may install the apparatus enhancing the efficiency of the relevant equipment and facilities to the extent necessary to provide telecommunications services.

(5) The Korea Communications Commission may, as prescribed by Presidential Decree, order a telecommunications business operator or facility management authority to submit data concerning equipment and facilities, so as to efficiently utilize and manage equipment and facilities. In such cases, the telecommunications business operator or facility management authority shall comply with such order unless justifiable grounds exist.

(6) The Korea Communications Commission may designate a specialized institution to provide equipment and facilities under paragraphs (1) and (2).

(7) Matters necessary for the designation of a specialized institution under paragraph (6) and the methods of business operations shall be determined and publicly announced by the Korea Communications Commission.

Article 36 (Joint Use of Subscriber Lines)

(1) Where a telecommunications business operator determined and publicly announced by the Korea Communications Commission requests a common telecommunications business operator to jointly use the lines installed in the section from modems directly connected with the users to the users (hereafter referred to as “subscriber lines” in this Article), the common telecommunications business operator shall permit the joint use of subscriber lines.

(2) The Korea Communications Commission shall establish and publicly announce the scope of, and the guidelines for the conditions, procedures, methods and calculation of prices for the joint use of subscriber lines under paragraph (1).

Article 37 (Joint Utilization of Radio Communications Facilities)

(1) Where a common telecommunications business operator receives a request for joint utilization of radio communications facilities (hereinafter referred to as “joint utilization“) from other common telecommunications business operators, he/she may permit joint utilization by contract. In such cases, the prices for joint utilization by common telecommunications business operators which are determined and publicly announced by the Korea Communications Commission shall be computed and adjusted in a fair and reasonable manner.

(2) Where a common telecommunications business operator determined and publicly announced by the Korea Communications Commission receives a request for joint utilization of radio communications facilities from another common telecommunications business operator determined and publicly announced by the Korea Communications Commission, he/she shall permit the joint utilization by contract, notwithstanding paragraph (1), in order to enhance the efficiency of the telecommunications business and protect users.

(3) The guidelines for calculating the prices for the joint utilization under the latter part of paragraph (1), procedures and methods for paying such prices, and the scope of, and the guidelines for the conditions, procedures, methods and calculation of prices for the joint utilization under paragraph (2) shall be determined and publicly announced by the Korea Communications Commission.

Article 38 (Wholesale Provision of Telecommunications Services)

(1) Where a common telecommunications business operator receives a request from another telecommunications business operator, he/she may reach agreements with such telecommunications business operators to provide his/her telecommunications services to them or permit them to fully or partially use telecommunications equipment and facilities required for the provision of telecommunications services (hereinafter referred to as “wholesale services“) so as to enable them to provide his/her telecommunications services to users (hereinafter referred to as “resale“).

(2) For the purpose of the promotion of competition in the telecommunications business, the Korea Communications Commission may designate and publicly announce telecommunications services (hereinafter referred to as “mandatory wholesale services“) to be provided by a common telecommunications business operator who shall provide wholesale services by contract (hereinafter referred to as “mandatory wholesale service provider“), upon receipt of a request from other telecommunications business operators who intend to provide resale telecommunications services. In such cases, mandatory wholesale services to be provided by a mandatory wholesale service provider shall be designated among telecommunications services provided by a common telecommunications business operator who satisfies the standards determined by Presidential Decree, such as the scale of the business and market share.

(3) Where the Korea Communications Commission deems, as a result of the annual assessment of competition in communications markets, that the purposes of wholesale telecommunications services are achieved by vitalizing the competition in the telecommunications business or mandatory wholesale services fail to meet the standards for designation, it may revoke the designation of mandatory wholesale services provided by a mandatory wholesale service provider.

(4) The Korea Communications Commission shall determine and publicly announce the guidelines for the conditions, procedures, methods and calculation of prices for providing wholesale services to be observed by a mandatory wholesale service provider when reaching an agreement for the provision of mandatory wholesale services. In such cases, in principle, the prices for providing wholesale services shall be calculated by subtracting avoidable costs (referring to the relevant costs that can be avoided if a common telecommunications business operator does not directly provide telecommunications services to users) from the resale prices for mandatory wholesale services.

(5) A common telecommunications business operator shall, upon receipt of a request for wholesale services from other telecommunications business operators, reach an agreement for such wholesale services within 90 days, unless justifiable grounds exist, and the telecommunications business operator who has reached an agreement for wholesale services with a common telecommunications business operator shall report to the Korea Communications Commission within 30 days after the date of such agreement, as prescribed by Presidential Decree. The same shall apply to the amendment to or revocation of an agreement for wholesale services.

(6) An agreement under paragraph (5) shall comply with the guidelines publicly announced by the Korea Communications Commission pursuant to paragraph (4).

Article 39 (Interconnection)

(1) Where a telecommunications business operator receives a request for interconnection of telecommunications equipment and facilities from other telecommunications business operators, he/she may permit the interconnection by contract.

(2) The Korea Communications Commission shall determine and publicly announce the scope of, and the guidelines for the conditions, procedures, methods and calculation of prices for interconnections of telecommunications equipment and facilities under paragraph (1).

(3) Notwithstanding paragraphs (1) and (2), any of the following common telecommunications business operators shall permit the interconnection by contract, upon receipt of a request under paragraph (1):

1. The common telecommunications business operator who possesses equipment and facilities indispensable for other telecommunications business operators to provide telecommunications services;

2. The common telecommunications business operator whose scale of the business, market share, etc. of common telecommunications services meet the standards determined by Presidential Decree.

Article 40 (Prices of Interconnection)

(1) Prices for interconnection shall be calculated in a fair and reasonable manner and adjusted by mutual agreements, and detailed guidelines, procedures and methods for calculating prices for interconnection shall be governed by the guidelines under Article 39 (2).

(2) Where a telecommunications business operator experiences any disadvantage in a method of interconnection, connection quality, the provision of information required for interconnection, etc. for reasons not attributable to him/her, he/she may pay the prices for interconnection reduced according to the guidelines under Article 39 (2).

Article 41 (Joint Use, etc. of Telecommunications Equipment and Facilities)

(1) Where a common telecommunications business operator receives a request for access to or joint use of his/her own telecommunications equipment and facilities, such as ducts, cables, poles or stations, from other telecommunications business operators who intend to establish or operate equipment and facilities required for interconnection, he/she may enter reach agreement with them to permit such access or joint use.

(2) The Korea Communications Commission shall determine and publicly announce the scope of and the guidelines for conditions, procedures, methods and calculation of prices for access to or joint use of telecommunications equipment or facilities under paragraph (1).

(3) Notwithstanding the provisions of paragraph (1), any of the following common telecommunications business operators shall permit access to or joint use of the telecommunications equipment or facilities under paragraph (1) by contract, upon receipt of a request under paragraph (1):

1. A common telecommunications business operator who possesses equipment and facilities indispensable for another telecommunications business operator to provide telecommunications services;

2. A common telecommunications business operator whose business scale, market share, etc. of common telecommunications services meet the standards prescribed by Presidential Decree.

Article 42 (Provision of Information)

(1) Where a telecommunications business operator requests a common telecommunications business operator to provide technical information or users’ personal information needed for the provision of equipment and facilities, wholesale services, interconnection services, joint-use services, billing and collections, and telephone number information services, the common telecommunications business operator may provide such information by contract with the telecommunications business operator.

(2) The Korea Communications Commission shall determine and publicly announce the scope of and the guidelines for conditions, procedures, methods and calculation of prices for providing information under paragraph (1).

(3) Notwithstanding the provisions of paragraph (1), any of the following common telecommunications business operators shall provide information requested by contract, upon receipt of a request under paragraph (1):

1. A common telecommunications business operator who possesses equipment and facilities indispensable for other telecommunications business operator to provide telecommunications services;

2. A common telecommunications business operator whose business scale, market share, etc. of common telecommunications services meet the standards prescribed by Presidential Decree.

(4) A common telecommunications business operator under paragraph (3) shall determine the technical standards to be satisfied by other telecommunications business operator or users who intend to connect their terminal devices, etc. with his/her own telecommunications equipment and facilities, the requirements for the provision and use, and other standards required for the creation of environments for fair competition, and publicly announce them by obtaining approval from the Korea Communications Commission.

Article 43 (Prohibition of Misuse of Information)

(1) No telecommunications business operator shall disclose any user’s personal information that he/she has obtained in the course of providing his/her own services, telecommunications equipment and facilities, wholesale services, interconnection services or joint-use services: Provided, That the same shall not apply in cases where a telecommunications business operator discloses such information with the user’s consent or under a lawful procedure pursuant to any Act.

(2) A telecommunications business operator shall use the technical information or user’s personal information obtained under Article 42 (1) and (3) only for its original purposes, and shall not misuse such information or provide such information to a third party.

Article 44 (Reporting, etc. on Agreement on Interconnection, etc.)

(1) Where a common telecommunications business operator or a facility management authority has received a request for the provision of equipment and facilities, joint utilization, interconnection or joint-use services or provision of information from other telecommunications business operators, he/she shall reach an agreement under Article 35 (1) and (2), the former part of Article 37 (1), Article 39 (1), 41 (1) or 42 (1) within 90 days unless special grounds exist and report it to the Korea Communications Commission within 30 days after the date of such agreement, as prescribed by Presidential Decree. The same shall apply to the amendment to or revocation of an agreement.

(2) Notwithstanding paragraph (1), if a common telecommunications business operator under the latter part of paragraph (1) and paragraph (2) of Article 37, and Articles 39 (3), 41 (3) or 42 (3) is a party to an agreement and requests another common telecommunications business operator to reach such agreement, the common telecommunications business operator who has received the request shall enter into the agreement within 90 days unless special grounds exist and apply for authorization to the Korea Communications Commission within 30 days after the date of agreement as prescribed by Presidential Decree, and disclose the details of such agreement within 30 days after the date of authorization. The same shall apply to the amendment to or revocation of an agreement.

(3) Agreements under paragraphs (1) and (2) shall comply with the guidelines publicly announced by the Korea Communications Commission pursuant to Articles 35 (3), 37 (3), 39 (2), 41 (2), or 42 (2).

(4) Where it is necessary to supplement an application for authorization under paragraph (2), the Korea Communications Commission may issue an order for supplementation by specifying a time limit for supplementation.

(5) Agreements under Articles 41 (1) and 42 (1) may be included in agreements under Article 39 (1).

Article 45 (Ruling by the Korea Communications Commission)

(1) A telecommunications business operator or user may apply for a ruling on the following matters to the Korea Communications Commission, when the parties concerned have failed to reach an agreement thereon or it is impossible to reach an agreement thereon:

1. Compensation for losses under Article 33;

2. Conclusion of an agreement within 90 days on the provision of equipment and facilities, joint utilization, wholesale services, interconnection or joint-use services, provision of information, etc.;

3. Implementation of an agreement on the provision of equipment and facilities, joint utilization, wholesale services, interconnection or joint-use services, provision of information, etc. or compensation for losses rising from the implementation of such agreement;

4. Other disputes related to the telecommunications business or subject matters of the ruling by the Korea Communications Commission under other Acts.

(2) The Korea Communications Commission shall, upon receipt of an application for a ruling under paragraph (1), give notice thereof to the other party and provide an opportunity to state his/her opinion within a specified period: Provided, That this shall not apply in cases where the party concerned fails to state his/her opinion without any justifiable ground.

(3) The Korea Communications Commission shall make a ruling within 90 days from the date of receipt of the application for a ruling: Provided, That if it fails to make a ruling within such period due to inevitable circumstances, the period may be extended only once for up to 90 days following a resolution passed by the Korea Communications Commission.

(4) Where one of the parties files a lawsuit during the ruling procedures, the Korea Communications Commission shall suspend such procedures and give notice thereof to the other party. The same shall apply in cases where it is confirmed that a lawsuit has been filed before the application for a ruling.

(5) Where the Korea Communications Commission makes a ruling on the matters under paragraph (1), it shall promptly serve the ruling documents on the parties concerned.

(6) Where no lawsuit is filed over the dispute between business operators or between a business operator and a user within 60 days after the date the certified transcripts of the ruling documents of the Korea Communications Commission are served on the business operator or user who is a party to the ruling or the lawsuit over such dispute is withdrawn or both parties clearly express their consent for the ruling to the Korea Communications Commission, both parties shall be deemed to have reached an agreement with the same effect as the ruling.

Article 46 (Referral of Disputes)

The Korea Communications Commission may establish a dispute settlement panel on a case-by-case basis and refer disputes to the relevant dispute settlement panel if it deems it appropriate or necessary to make a ruling on the matters under Article 45 (1).

Article 47 (Request for Appearance, Hearing of Opinions, etc.)

Where the Korea Communications Commission deems it necessary to deal with ruling cases, it may take any of the following measures upon receipt of an application by the party concerned or ex officio:

1. Requests for appearance by or hearing of opinions from the party concerned or a witness;

2. Requests for appraisal by an appraiser;

3. Requests for submission of documents or articles related to disputes and keeping documents or articles submitted in custody.

Article 48 (Management Plan for Telecommunications Numbers, etc.)

(1) The Korea Communications Commission shall develop and implement management plans for telecommunications numbers in order to efficiently provide telecommunications services, to promote user convenience and to create environments for fair competition among telecommunications business operators.

(2) Where the Korea Communications Commission has developed the plans under paragraph (1), it shall publicly announce them. The same shall also apply to an amendment to the developed plan.

(3) Any telecommunications business operator shall comply with the matters publicly announced under paragraph (2).

Article 49 (Settlement of Accounts)

(1) Any common telecommunications business operator shall complete settlement of accounts as prescribed by Presidential Decree, prepare a business report for the preceding year and submit it to the Korea Communications Commission by not later than three months after the end of each fiscal year, and retain the related books and source documents.

(2) Where the Korea Communications Commission intends to determine the matters concerning settlement of accounts under paragraph (1), it shall first consult with the Minister of Strategy and Finance.

(3) The Korea Communications Commission may verify the details of any business report submitted by a common telecommunications business operator in accordance with paragraph (1).

(4) If it is necessary to conduct the verification referred to in paragraph (3), the Korea Communications Commission may order the relevant common telecommunications business operator to submit related material or conduct an inspection necessary to ascertain the facts.

(5) Where the Korea Communications Commission intends to conduct an inspection pursuant to paragraph (4), it shall notify the relevant common telecommunications business operator of the inspection plan, including the period for and reasons and details of the inspection by not later than seven days before such inspection.

(6) Any person who conducts an inspection pursuant to paragraph (4) shall present a certificate indicating his/her authority to the persons concerned, and deliver thereto a document stating his/her name, the period and purpose of visit, etc. at the time of his/her first visit.

Article 50 (Prohibited Acts)

(1)          No telecommunications business operator may commit any of the following acts (hereinafter referred to as “prohibited acts“) which undermine or are feared to undermine fair competition or users’ interests, or allow other telecommunications business operators or third parties to commit such acts:

1. Acts which place unfair or discriminative conditions or restrictions on the provision of equipment and facilities, joint utilization, interconnection or joint-use services, wholesale services, provision of information, etc.;

2. Acts which unfairly refuse to conclude an agreement on the provision of equipment and facilities, joint utilization, interconnection or joint-use services, wholesale services, provision of information, etc. or failing to implement a concluded agreement without justifiable grounds;

3. Acts which misuse the information of other telecommunications business operators that he/she has obtained in the course of the provision of equipment and facilities, joint utilization, interconnection or joint-use services, wholesale services, provision of information, etc., for his/her business operations;

4. Acts which compute telecommunications service charges or the prices for the provision of equipment and facilities, joint utilization, interconnection or joint-use services, wholesale services, provision of information, etc., by unfairly itemizing the expenses or revenues;

5. Acts which provide telecommunications services in a manner different from the terms and conditions of use (limited to the terms and conditions of use reported or authorized under Article 28 (1) and (2)), or in a manner which substantially undermines telecommunications users’ interests;

6. Acts which determine that the prices for the provision of equipment and facilities, joint utilization, interconnection or joint-use services, wholesale services, provision of information, etc. which are unfairly higher than the supply prices;

7. Acts which refuse or restrict appropriate profit sharing when trading digital content through telecommunications services using the frequencies allocated under the Radio Waves Act.

(2) Where the provisions of Articles 52 and 53 apply to the acts under paragraph (1) 5 committed by a person who acts for a telecommunications business operator to conclude contracts (or modify the terms of concluded contracts) with users under an agreement with the telecommunications business operator, such acts shall be deemed to have been committed by the telecommunications business operator: Provided, That the same shall not apply in cases where the telecommunications business operator has paid considerable attention in order to prevent such acts.

(3) Matters necessary for categories of and standards for the acts prohibited under paragraph (1) shall be prescribed by Presidential Decree.

Article 51 (Fact-Finding Investigations, etc.)

(1) Where the Korea Communications Commission is notified or become aware that any act has been committed in violation of Article 50 (1), it may order the public officials under its control to conduct a fact-finding investigation necessary for the verification thereon.

(2) Ifthe Korea Communications Commission deems a fact-finding investigation under paragraph (1) is necessary, it may order the public official under its control to visit the offices or places of business of a telecommunications business operator or places of business of a person entrusted with the affairs of a telecommunications business operator (if the affairs entrusted by a telecommunications business operator are related to the provisions of Article 50, limited only to such affairs; hereafter the same shall apply in this Article) for an investigation on books, documents, other data or articles.

(3) Where the Korea Communications Commission intends to conduct a fact-finding investigation under paragraph (1), it shall notify the relevant telecommunications business operator of an investigation plan, including a period for and reasons and details of the investigation by not later than seven days before such investigation: Provided, That this shall not apply in cases of emergency or in cases where deemed that any prior notification might cause the destruction of any evidence to make it impossible to attain the purposes of such investigation.

(4) A person who visits the offices or places of business of a telecommunications business operator or the places of business of a person entrusted with the affairs of a telecommunications business operator to conduct a fact-finding investigation under paragraph (2) shall present a certificate indicating his/her authority, and allow the persons interested in the relevant offices or places of business to participate in such fact-finding investigation.

(5) Any public official in charge of a fact-finding investigation under paragraph (2) may order a telecommunications business operator or a person entrusted with the affairs of a telecommunications business operator to submit necessary data or articles, and temporarily keep such data or articles in his/her custody if the destruction of evidence, such as the disposal, concealment, or replacement of such data or articles, is anticipated.

(6) The Korea Communications Commission shall promptly return the data or articles kept in custody if they fall under any of the following subparagraphs:

1. Where it is deemed upon examination that they are not associated with the relevant investigation;

2. Where it is no longer necessary to keep them in custody because the purposes of the relevant investigation are achieved.

Article 52 (Measures on Prohibited Acts)

(1) The Korea Communications Commission may order a telecommunications business operator to take any of the following measures if it deems that a violation of Article 50 (1) has been committed:

1. Separation of the supply system of telecommunications services;

2. Amendment to internal accounting regulations, etc. concerning telecommunications services;

3. Disclosure of information concerning telecommunications services;

4. Conclusion, implementation or change of terms of an agreement between telecommunications business operators;

5. Amendment to the terms and conditions of use and the articles of incorporation of telecommunications business operators;

6. Suspension of prohibited acts;

7. Public announcement of a fact that a corrective order is issued due to prohibited acts;

8. Measures necessary for correcting the violation caused by prohibited acts, such as the removal of telecommunications equipment and facilities;

9. Business process improvement for telecommunications services;

10. Prohibition on the recruitment of new users for up to three months (limited to the cases where a violation is repeated at least three times even though the measures under subparagraphs 1 through 9 have been taken on such violation or where it is clearly recognized that such measures are not sufficient to prevent damage to users);

11. Other matters prescribed by Presidential Decree as may be necessary to take the measures referred to in subparagraphs 1 through 10.

(2) Telecommunications business operators shall comply with an order issued by the Korea Communications Commission under paragraph (1) within a period specified by Presidential Decree: Provided, That the Korea Communications Commission may extend the relevant period only once, if it is deemed that the telecommunications business operator is unable to comply with the order within the specified period due to natural disasters and other extenuating circumstances.

(3) The Korea Communications Commission shall notify the parties concerned of the details of measures and provide them with an opportunity to state their opinions within a prescribed period before it takes measures under paragraph (1), and where deemed necessary, it may request an interested party or witness to appear and state his/her opinions or request an appraiser to conduct appraisal: Provided, That this shall not apply in cases where the parties concerned fail to state their opinions without justifiable grounds.

(4) The Korea Communications Commission shall not take any measures under paragraph (1) or impose penalty surcharges under Article 53 on a violation of Article 50 (1) if five years have passed after such violation: Provided, That this shall not apply where any measure already taken or the imposition of a penalty surcharge is revoked by a court and a new measure is to be taken based on such decision.

Article 53 (Imposition, etc. of Penalty Surcharge on Prohibited Acts)

(1) Where any act is committed in violation of Article 50 (1), the Korea Communications Commission may impose a penalty surcharge on the relevant telecommunications business operator in an amount not exceeding 3/100 of his/her profit prescribed by Presidential Decree. In such cases, if the telecommunications business operator refuses to submit data necessary for the calculation of his/her profit or submits false data, such profit may be estimated based on financial statements and other accounting materials of the relevant telecommunications business operator and the business operators providing the same or similar type of services, and the materials concerning the current status of business operations, such as the number of subscribers, service charges, etc.: Provided, That where there is no profit or it is difficult to calculate the profit as prescribed by Presidential Decree, a penalty surcharge may be imposed in an amount not exceeding one billion won.

(2) Where a common telecommunications business operator who shall submit a business report under Article 49 falls under any of the following subparagraphs, the Korea Communications Commission may impose a penalty surcharge on the relevant common telecommunications business operator in an amount not exceeding 3/100 of his/her profit prescribed by Presidential Decree:

1. Where he/she fails to submit a business report under Article 49 or to comply with an order to submit relevant materials;

2. Where he/she fails to include important matters in a business report under Article 49 or includes false matters;

3. Where he/she fails to perform accounting, in violation of Article 49 (1) or to retain books or source documents.

(3) The Korea Communications Commission shall imposes a penalty surcharge under paragraph (1) or (2) in consideration of the following matters:

1. Details and severity of the violation;

2. Duration and frequency of the violation;

3. Scale of the gains from the violation;

4. Profits related to the performance of prohibited acts or the violation of accounting rules by a telecommunications business operator.

(4) A penalty surcharge under paragraph (1) or (2) shall be determined in consideration of paragraph (3) and the detailed guidelines and procedures for determination shall be prescribed by Presidential Decree.

(5) Where a person liable to pay a penalty surcharge under paragraph (1) or (2) fails to do so by the payment deadline, the Korea Communications Commission shall collect 6/100 per annum of the penalty surcharge in arrears as an additional due from the day following the expiry of such payment deadline.

(6) Where a person liable to pay a penalty surcharge under paragraph (1) or (2) fails to do so by the payment deadline, the Korea Communications Commission shall demand him/her to pay it within a prescribed period, and if he/she fails to pay the penalty surcharge and the additional due under paragraph (5) within the prescribed period, it shall collect them in the same manner as dispositions on default of national taxes.

(7) Where the penalty surcharge imposed pursuant to paragraph (1) or (2) is refunded by a court, etc., additional dues shall be paid at a rate of 6/100 per annum for a period from the date when the penalty surcharge is paid to the date of such refund.

Article 54 (Relations with Other Acts)

Where a telecommunications business operator is subject to a measure under Article 52 or a penalty surcharge under Article 53 on the grounds that he/she violates Article 50 (1), the telecommunications business operator shall not be subject to a corrective measure or penalty surcharge under the Monopoly Regulation and Fair Trade Act on the same grounds.

Article 55 (Compensation for Losses)

Where a measure has been taken under Article 52 (1), a person who suffers losses from a prohibited act may claim compensation for losses against the telecommunications business operator who has committed such prohibited act, and the relevant telecommunications business operator may not be exempt from liability to compensate for losses unless he/she is able to prove that there was no malicious intention or negligence.

Article 56 (Quality Improvement, etc. of Telecommunications Services)

(1) A telecommunications business operator shall endeavor to improve the quality of telecommunications services he/she provides.

(2) The Korea Communications Commission shall develop policy measures, such as an evaluation of quality of telecommunications services, in order to improve the quality of telecommunications services and to enhance the conveniences of users.

(3) The Korea Communications Commission may order a telecommunications business operator to submit data necessary for the evaluation of quality of telecommunications services, etc. under paragraph (2).

Article 57 (Preselection Systems)

(1) The Korea Communications Commission shall implement the systems in which users may select in advance the telecommunications business operator who is to provide telecommunications services thereto (hereinafter referred to as “preselection systems“). In such cases, the telecommunications services shall refer to telecommunications services determined by Presidential Decree among the same telecommunications services provided by multiple telecommunications business operators.

(2) A telecommunications business operator shall not force users to select a specified telecommunications business operator in advance, or recommend or induce by unlawful means.

(3) The Korea Communications Commission may designate a specialized institute in charge of the affairs concerning registration of preselection or modification thereto (hereinafter referred to as “preselection registration center“) in order to efficiently and neutrally implement the preselection systems.

(4) Matters necessary for the implementation of the preselection systems, the designation of the preselection registration center and the method of business operations, etc. shall be determined and publicly announced by the Korea Communications Commission.

Article 58 (Telephone Number Portability)

(1) The Korea Communications Commission may establish and implement a plan for telephone number portability (hereafter referred to in this Article as “plan for number portability“) to enable users to retain their telephone numbers when changing from one telecommunications business operator to another.

(2) A plan for number portability shall include the following matters:

1. Kinds of services subject to telephone number portability;

2. Time to start telephone number portability for each service;

3. Matters concerning sharing of expenses incurred in the implementation of a plan for number portability among telecommunications business operators.

(3) The Korea Communications Commission may order the relevant telecommunications business operator to take measures necessary for the implementation of a plan for number portability.

(4) The Korea Communications Commission may designate a specialized institution in charge of registration of number portability and modification thereto (hereinafter referred to as “number portability management institution“) to efficiently and neutrally implement telephone number portability.

(5) Matters concerning the implementation of telephone number portability and matters necessary for the designation of a number portability management institution and the operation of its affairs shall be determined and publicly announced by the Korea Communications Commission.

Article 59 (Limitation on Mutual Holding of Stocks)

(1) Where a common telecommunications business operator under Article 39 (3) 1 or 2 (including a person in a special relation with him/her) holds in excess of 5/100 of the total number of voting stocks issued by another common telecommunications business operator, he/she shall not be allowed to exercise any voting rights in excess of the relevant ceiling.

(2) Paragraph (1) shall not apply to holding relationship between a common telecommunications business operator under Article 39 (3) 1 or 2 and a common telecommunications business operator established by the said common telecommunications business operator by becoming the largest stockholder.

Article 60 (Provision of Number Information Services)

(1) A telecommunications business operator shall provide a service to inform the general public of the telephone numbers of users by means of voice, booklets or the Internet, etc. (hereinafter referred to as “number information service“) by obtaining a consent from users: Provided, That the same shall not apply to minor business determined and publicly announced by the Korea Communications Commission in consideration of the numbers of users, profits, etc.

(2) The Korea Communications Commission may place restrictions on the provision of number information services to the extent necessary to protect personal information.

(3) Matters necessary for the provision of number information services may be prescribed by Presidential Decree.

CHAPTER V.- TELECOMMUNICATIONS EQUIPMENT AND FACILITIES

SECTION 1.- Commercial Telecommunications Equipment and Facilities

Article 61 (Maintainment and Repair of Telecommunications Equipment and Facilities)

A telecommunications business operator shall maintain and repair his/her own telecommunications equipment and facilities in compliance with the technical standards prescribed by Presidential Decree so as to reliably provide his/her telecommunications services.

Article 62 (Reporting and Approval on Installation of Telecommunications Equipment and Facilities)

(1) Where a common telecommunications business operator intends to install or change important telecommunications equipment and facilities, he/she shall submit a prior report to the Korea Communications Commission, as prescribed by Presidential Decree: Provided, That in terms of telecommunications equipment and facilities installed for the first time thanks to a new telecommunications technology, the operator shall obtain approval from the Korea Communications Commission, as prescribed by Presidential Decree.

(2) Scope of important telecommunications equipment and facilities under paragraph (1) shall be prescribed and publicly announced by the Korea Communications Commission.

Article 63 ( Joint Installation of Telecommunications Equipment and Facilities)

(1) A common telecommunications business operator may install and use telecommunications equipment and facilities jointly with other common telecommunications business operators through consultation thereon with them.

(2) Where common telecommunications business operators have consultation under paragraph (1), the Korea Communications Commission may conduct researches on necessary data and provide them to common telecommunications business operators, as prescribed by Presidential Decree.

(3) The Korea Communications Commission may request an institution specialized in telecommunications to conduct researches under paragraph (2) as prescribed by Presidential Decree, so as to efficiently conduct the relevant researches.

(4) In any case described in the following subparagraphs, the Korea Communications Commission may recommend a common telecommunications business operator under paragraph (1) to jointly install telecommunications equipment and facilities, as prescribed by Presidential Decree:

1. Where consultation under paragraph (1) fails to lead to agreement, and the relevant common telecommunications business operator makes a request;

2. Where it is deemed necessary to promote public interests.

(5) Where it is necessary for a common telecommunications business operator to use land, buildings, etc. owned by the State, local governments, public institutions under the Act on the Management of Public Institutions (hereafter referred to as “public institutions” in this Article) or other common telecommunications business operators for the joint installation of telecommunications equipment and facilities, and consultation fails to lead to agreement on the use of such land, buildings, etc., the common telecommunications business operator may request the Korea Communications Commission to provide cooperation for the use of the relevant land, buildings, etc.

(6) Where the Korea Communications Commission receives a request for cooperation under paragraph (5), it may request the State agencies, local governments, the heads of public institutions, or other common telecommunications business operators to respond to the consultation on the use of the relevant land, buildings, etc. with the common telecommunications business operator who submits a request for cooperation under paragraph (5). In such cases, the State agencies, local governments, the heads of public institutions, or other common telecommunications business operators shall respond to the consultation with the common telecommunications business operator unless justifiable grounds exist.

SECTION 2.- Private Telecommunications Equipment and Facilities

Article 64 (Installation of Private Telecommunications Equipment and Facilities)

(1) Any person who intends to install private telecommunications equipment and facilities shall report to the Korea Communications Commission, as prescribed by Presidential Decree. The same shall apply in cases where he/she intends to change any important matter prescribed by Presidential Decree, among the reported matters.

(2) Notwithstanding paragraph (1), other Acts shall apply to private wireless telecommunications equipment and facilities and military telecommunications equipment and facilities, if otherwise prescribed by such other Acts.

(3) Where a person who has reported on the installation of private telecommunications equipment and facilities or reported on the change thereof pursuant to paragraph (1) completes the installation works or installation change works, he/she shall obtain prior confirmation from the Korea Communications Commission, as prescribed by Presidential Decree.

(4) Notwithstanding paragraph (1), private telecommunications equipment and facilities prescribed by Presidential Decree may be installed without reporting.

Article 65 (Restrictions on Use for other Purposes)

(1) No person who installs private telecommunications equipment and facilities shall advocate a third party’s communications through such equipment and facilities or operate such equipment and facilities not in accordance with the purposes of installation: Provided, That this shall not apply in cases where he/she uses them for any of the following purposes to the extent permitted by other Acts or to the extent that does not impede the purposes of installation:

1. Cases of allowing a policeman or a person engaged in disaster relief to use private telecommunications equipment and facilities for the maintenance of public order or for emergency disaster relief;

2. Cases of using private telecommunications equipment and facilities between a person who installs such equipment and facilities and a person in a special business relationship with him/her, as publicly announced by the Korea Communications Commission.

(2) A person who has installed private telecommunications equipment and facilities may provide his/her own telecommunications equipment and facilities, such as ducts or cables, to common telecommunications business operators, as prescribed by Presidential Decree.

(3) Articles 35, 44 (excluding paragraph (5)), 45 through 47 shall apply mutatis mutandis to the provision of equipment and facilities under paragraph (2).

Article 66 (Procurement of Communications in Cases of Emergency)

(1) The Korea Communications Commission may order a person who has installed private telecommunications equipment and facilities to carry out the telecommunications business or other important communications business or to connect his/her telecommunications equipment and facilities with other telecommunications equipment and facilities, at the time of war, an upheaval, natural disaster or any national emergency equivalent thereto or if an outbreak of such emergency is highly apprehended. In such cases, the provisions of Articles 28 through 55 shall apply mutatis mutandis.

(2) If he Korea Communications Commission deems necessary, he/she may require a common telecommunications business operator to carry out the business under paragraph (1).

(3) In cases under paragraph (1), the expenses incurred in carrying out the business and connecting equipment and facilities shall be reimbursed by the Government: Provided, That where private telecommunications equipment and facilities are used for telecommunications services, the expenses incurred therein shall be reimbursed by the common telecommunications business operator who uses such equipment and facilities.

Article 67 (Corrective Order, etc. Issued to Private Telecommunications Equipment and Facilities Installers)

(1) Where a person who has installed private telecommunications equipment and facilities violates this Act or any order under this Act, the Korea Communications Commission may order him/her to take a corrective measure within a prescribed period.

(2) Where a person who has installed private telecommunications equipment and facilities falls under any of the following subparagraphs, the Korea Communications Commission may order him/her to suspend the use of such equipment and facilities for up to one year:

1. Where he/she fails to comply with the corrective order under paragraph (1);

2. Where he/she uses private telecommunications equipment and facilities without confirmation in violation of Article 64 (3);

3. Where he/she advocates a third party’s communications or operates private telecommunications equipment and facilities not in accordance with the purpose of installation in violation of Article 65 (1).

(3) Where it is deemed that private telecommunications equipment and facilities are feared to impede a third party’s telecommunications or to harm a third party’s telecommunications equipment and facilities, the Korea Communications Commission may order the person who has installed such private telecommunications equipment and facilities to suspend the use of his/her equipment and facilities, to reform or repair them, or to take other necessary measures.

SECTION 3.- Integrated Management, etc. of Telecommunications Equipment and Facilities

Article 68 (Installation of Conduits, Ducts, etc.)

(1) Any person who installs or constructs any of the following facilities (hereinafter referred to as “facility installer“) shall consider the opinions of a common telecommunications business operator on the installation of common utility conduits, ducts, etc. that can carry telecommunications equipment and facilities and reflect them on the installation or construction of such facilities: Provided, That this shall not apply in cases where he/she fails to reflect the opinions of the common telecommunications business operator due to any extenuating circumstance:

1. Roads under Article 2 (1) 1 of the Road Act;

2. Railroads under subparagraph 1 of Article 2 of the Railroad Enterprise Act;

3. Urban railroads under subparagraph 1 of Article 3 of the Urban Railroad Act;

4. Industrial complexes under subparagraph 5 of Article 2 of the Industrial Sites and Development Act;

5. Free trade zones under subparagraph 1 of Article 2 of the Act on Designation and Management of Free Trade Zones;

6. Airport zones under subparagraph 9 of Article 2 of the Aviation Act;

7. Harbor zones under subparagraph 4 of Article 2 of the Harbor Act;

8. Other facilities or sites prescribed by Presidential Decree.

(2) A common telecommunications business operator shall present his/her opinions on the installation of common utility conduits, ducts, etc. under paragraph (1) in compliance with the guidelines prescribed by Presidential Decree for installing conduits.

(3) Articles 35, and 44 (excluding paragraph (5)) and 45 through 47 shall apply mutatis mutandis to the provision of common utility conduits, ducts, etc. established under paragraph (1).

(4) Where a facility installer is unable to reflect the opinions of a common telecommunications business operator pursuant to paragraph (1), he/she shall notify the relevant common telecommunications business operator of the reasons therefor within 30 days after the date of receipt of such opinions.

(5) Where a facility installer fails to reflect the opinions of a common telecommunications business operator pursuant to paragraph (1), the relevant common telecommunications business operator may submit a request for mediation to the Korea Communications Commission.

(6) Where the Korea Communications Commission intends to provide mediatory suggestions upon receipt of a request for mediation under paragraph (5), it shall first consult with the head of the relevant central administrative agency.

(7) Matters necessary for mediation under paragraphs (5) and (6) shall be prescribed by Presidential Decree.

Article 69 (Establishment of Building Telecommunications Cabling Systems, etc.)

(1) A building under Article 2 (1) 2 of the Building Act shall be equipped with the building telecommunications cabling systems, and secure a certain space for connection with telecommunications line equipment and facilities.

(2) Matters necessary for the scope of buildings, guidelines for establishing the telecommunications cabling systems, and securing a space for connection with telecommunications line equipment and facilities pursuant to paragraph (1) shall be prescribed by Presidential Decree.

 Article 70 (Integrated Management of Telecommunications Equipment and Facilities, etc.)

(1) Where it is necessary for the efficient management and operation of telecommunications equipment and facilities, the Korea Communications Commission may entrust the integrated management of telecommunications equipment and facilities installed under this Act or any other Act and land, buildings or other structures attached thereto (hereinafter referred to as “telecommunications equipment and facilities, etc.”) to the common telecommunications business operator who has been selected in accordance with the guidelines and procedures prescribed by Presidential Decree (hereinafter referred to as “telecommunications business operator entrusted with the integrated management“).

(2) Where the Korea Communications Commission intends to entrust the integrated management of telecommunications equipment and facilities under paragraph (1), it shall develop a plan for the integrated management of telecommunications equipment and facilities (hereinafter referred to as “integrated management plan“) and obtain approval therefor from the President through consultation with the head of the relevant administrative agency and through deliberation by the State Council.

(3) An integrated management plan shall include the following matters:

1. Subjects, periods, methods and procedures of the integrated management;

2. Matters concerning the management of telecommunications equipment and facilities, etc. after integration;

3. Other matters prescribed by Presidential Decree.

(4) Where the Korea Communications Commission intends to develop an integrated management plan, it shall first consult with the person who installs telecommunications equipment and facilities to be integrated.

Article 71 (Purchase of Telecommunications Equipment and Facilities, etc.)

(1) If it is necessary for the integrated management of telecommunications equipment and facilities, a telecommunications business operator entrusted with the integrated management may claim for the purchase of the relevant telecommunications equipment and facilities. In such cases, the owner of the relevant telecommunications equipment and facilities shall not refuse the claim without any justifiable ground.

(2) Notwithstanding Article 27 of the State Property Act or Article 19 of the Public Property and Commodity Management Act, State-owned or publicly-owned telecommunications equipment and facilities, etc. claimed by a telecommunications business operator entrusted with the integrated management may be sold to the telecommunications business operator entrusted with the integrated management. In such cases, matters necessary for the sales, such as the methods of calculating the sale price, procedures for sales, and payment methods of the purchase prices shall be prescribed by Presidential Decree.

(3) With respect to the methods and guidelines for calculating the sale price of non-state-owned or non-publicly-owned telecommunications equipment and facilities to be purchased by a telecommunications business operator entrusted with the integrated management under paragraph (1), the provisions of Articles 67 (1), 70, 71, 74, 75, 75-2, 76, 77 and 78 (5) through (7) shall apply mutatis mutandis.

SECTION 4.- Installation and Preservation of Telecommunications Equipment and Facilities

Article 72 (Use of Land, etc.)

(1) If it is necessary for the installation of lines, antennas, and their appurtenant facilities to be available for telecommunications services (hereinafter referred to as “lines, etc.”), a common telecommunications business operator may use a third party’s land, or buildings and structures attached thereto, and surface and bottom of the water (hereinafter referred to as “land, etc.”). In such cases, the common telecommunications business operator shall consult with the owners or occupants of the relevant land, etc, in advance.

(2) Where consultation under paragraph (1) fails to lead to agreement or fails to take place, a common telecommunications business operator may use a third party’s land, etc. pursuant to the Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor.

Article 73 (Temporary Use of Land, etc.)

(1) If it is necessary for the measurement of lines, etc. and the installation works or preservation works of telecommunications equipment and facilities, a common telecommunications business operator may temporarily use private, national or public telecommunications equipment and facilities and land, etc. to the extent that does not substantially impede the current use thereof.

(2) No person shall impede the measurement of lines, etc., the installation works or preservation works of telecommunications equipment and facilities and the temporary use of telecommunications equipment and facilities and land, etc. under paragraph (1) without any justifiable ground.

(3) When a common telecommunications business operator intends to temporarily use private, national or public property under paragraph (1), he/she shall notify the occupants, in advance, of the purposes of and period for such use: Provided, That in cases where it is difficult to give prior notice, he/she shall give prompt notice during or after the use, and in cases where he/she is unable to notify the purposes of and period for the use due to an obscurity of an address and residence of occupants, he/she shall publicly announce them.

(4) No period of temporary use of land, etc. under paragraph (1) may exceed six months.

(5) A person who temporarily uses private, national or public telecommunications equipment and facilities or land, etc. under paragraph (1) shall carry with him/her a certificate indicating his/her authority, and present it to the persons concerned.

Article 74 (Entrance to Land, etc.)

(1) A common telecommunications business operator may enter into a third party’s land, etc., to the extent necessary for the measurement, inspection , etc., for the installation and preservation of his/her telecommunications equipment and facilities: Provided, That in cases where the place where he/she intends to enter into is a residential building, a consent from residents shall be obtained.

(2) No person shall impede the measurement, inspection, etc. for the installation or preservation of telecommunications equipment and facilities and a entrance to land, etc. under paragraph (1) without any justifiable ground.

(3) Article 73 (3) and (5) shall apply mutatis mutandis to notification and presentation of a certificate if a person engaged in the measurement, inspection, etc. under paragraph (1) enters private, national or public land, etc.

Article 75 (Request for Removal of Obstacles, etc.)

(1) A common telecommunications business operator may request the owners or users of gas pipes, water pipes, drain pipes, electric lamp lines, power lines or private telecommunications equipment and facilities, which impede or are feared to impede the installation of lines, etc. or common telecommunications equipment and facilities (hereinafter referred to as “obstacles, etc.”) to relocate, reform, or repair them or to take other necessary measures.

(2) A common telecommunications business operator may request the owners or the persons in possession of plants, which impede or are feared to impede the installation or maintenance of lines, etc. or telecommunications to remove such plants.

(3) Where an owner or a persons in possession of a plant fails to comply with the request under paragraph (2), or where extenuating circumstances exist, a common telecommunications business operator may fell or transplant the relevant plant by obtaining permission from the Korea Communications Commission. In such cases, he/she shall promptly notify the owner or the person in possession of the relevant plant.

(4) Where an obstacle, which impedes or is likely to impede the telecommunications equipment and facilities of a common telecommunications business operator, needs to be newly established, enlarged, improved, removed or changed, the owner or user of such obstacles shall consult with the common telecommunications business operator, in advance.

Article 76 (Obligation for Reinstatement)

Where the use of land, etc. under Articles 72 and 73 is terminated or it is no longer necessary to provide land, etc. used for telecommunications services, a common telecommunications business operator shall reinstate the relevant land, etc., and where it is impossible to reinstate the relevant land, etc., he/she shall properly compensate for any losses suffered by the owners or users.

Article 77 (Compensation for Losses)

Where a common telecommunications business operator causes losses to a third party in cases under Article 73 (1), 74 (1) or 75, he/she shall compensate the third party for such losses.

Article 78 (Procedures for Compensation for Losses to Land, etc.)

(1) Where a common telecommunications business operator compensates for any losses pursuant to Article 76 or 77 on any of the following grounds, he/she shall consult with the person who suffered such losses:

1. Temporary use of land, etc. under Article 73 (1);

2. Entrance to land, etc. under Article 74 (1);

3. Relocation, reform or repair of obstacles, etc. or removal of plants under Article 75;

4. Impossibility of reinstatement under Article 76.

(2) When consultation under paragraph (1) fails to lead to agreement or fails to take place, an application for adjudication shall be filed with the competent Land Expropriation Commission under the Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor.

(3) Except as otherwise prescribed by this Act, the Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor shall apply mutatis mutandis to the standards, methods and procedures for compensation for losses, etc. to land, etc. under paragraph (1), and an application for adjudication under paragraph (2).

Article 79 (Protection of Telecommunications Equipment and Facilities)

(1) No person shall destroy telecommunications equipment and facilities, nor obstruct the flow of telecommunications by impeding the functions of telecommunications equipment and facilities by means of contacting other objects with them or by any other means.

(2) No person may contaminate telecommunications equipment and facilities or damage measurement marks of telecommunications equipment and facilities by means of throwing any object at the telecommunications equipment and facilities or tying an animal, vessel or a log raft thereto.

(3) In order to protect telecommunication cables or supplementary facilities laid on the seabed (hereafter referred to as “submarine cable“), a common telecommunications business operator may file an application for the designation of a submarine cable zone to the Korea Communications Commission.

(4) The Korea Communications Commission upon receipt of application under paragraph (3), shall examine the necessity for such designation and may designate a submarine cable zone and publicly announce it, following consultation with the head of the relevant central administrative agency.

(5) Matters concerning application for designation of a submarine cable zone, methods and procedures for designation and public announcement, methods of installing warning signs, etc. shall be prescribed by Presidential Decree.

Article 80 (Relocation, etc. of Equipment and Facilities.)

(1) Where telecommunications equipment and facilities of a common telecommunications business operator impede the use of land, etc. in which they are located due to changes to the purposes or methods of using such land, etc. or land adjacent thereto, the owner or occupant of such land, etc. may request the common telecommunications business operator to relocate the telecommunications equipment and facilities, and take other necessary measures to remove the impediment.

(2) A common telecommunications business operator shall, upon receipt of a request under paragraph (1), take necessary measures unless he/she has a difficulty in business operations or a technical difficulty to take such measures.

(3) Expenses incurred in the measures under paragraph (2) shall be reimbursed by a person who has made measures necessary to relocate the relevant equipment and facilities or remove the impediment after installation of the equipment and facilities: Provided, That in cases where a person who is liable to reimburse the expenses is the owner or occupant of the relevant land, etc. and falls any of the following subparagraphs, a common telecommunications business operator may reduce or exempt expenses to be reimbursed by such owner or occupant, taking into account the amount of compensation at the time of the installation of the equipment and facilities and the period for the installation thereof:

1. Where a common telecommunications business operator develops and implements plans for the relocation of the relevant telecommunications equipment and facilities or for the removal of the impediments;

2. Where the relocation of the relevant telecommunications equipment and facilities or removal of the impediments is beneficial for other telecommunications equipment and facilities;

3. Where the State or a local government requests the relocation of the relevant telecommunications equipment and facilities or removal of the impediments;

4. Where telecommunications equipment and facilities installed in private land is relocated because they substantially impede the use of such private land.

Article 81 (Cooperation, etc. with Other Organizations)

A common telecommunications business operator may ask the relevant public agencies for a cooperation, in case where the operation of vehicles, vessels, airplanes and other carriers is necessary for the installation and preservation of his/her telecommunications equipment and facilities. In such cases, upon receipt of a request for cooperation, the public agency shall comply with the request unless justifiable grounds exist.

Article 82 (Inspection, Reporting, etc.)

(1) Where it is necessary for the development of telecommunications policies or where it is prescribed by Presidential Decree, the Korea Communications Commission may inspect the current installation status, books or documents of a person who has installed telecommunications equipment and facilities or require him/her to report on his/her equipment and facilities.

(2) Where a person has installed telecommunications equipment and facilities in violation of this Act, the Korea Communications Commission may order him/her to remove the relevant equipment and facilities or take other necessary measures.

CHAPTER VI.- SUPPLEMENTARY PROVISIONS

Article 83 (Protection of Confidentiality of Communications)

(1) No person may infringe or divulge the confidentiality of communications carried by telecommunications business operators.

(2) No person who is or has been engaged in telecommunications services may divulge a third party’s confidential information with respect to communications obtained in the course of performance of his/her duties.

(3) A telecommunications business operator may comply with a request for the perusal or provision of any of the following data (hereinafter referred to as “provision of communications data“) from a court, a prosecutor, the head of an investigative agency (including the head of a military investigative agency, the Commissioner of the National Tax Service and the Commissioner of a Regional Tax Office; hereinafter the same shall apply) or the head of an intelligence and investigation agency, who intends to collect information or intelligence in order to prevent any threat to a trial, an investigation (including the investigation of a violation committed by means of a telephone, the Internet, etc. among the offenses prescribed in Article 10 (1), (3) and (4) of the Punishment of Tax Evaders Act), the execution of a sentence or the guarantee of the national security:

1. Names of users;

2. Resident registration numbers of users;

3. Addresses of users;

4. Phone numbers of users;

5. User identification word (referring to the identification codes of users used to identify the rightful users of computer systems or communications networks);

6. Dates on which users subscribe or terminate their subscriptions.

(4) The request for provision of communications data under paragraph (3) shall be made in writing (hereinafter referred to as “written request for provision of data“), which states a reason for such request, relation with the relevant user and the scope of necessary data: Provided, That where it is impossible to make a request in writing due to an urgent reason, such request may be made without resorting to writing, and when such reason disappears, a written request for provisions of data shall be promptly filed with the telecommunications business operator.

(5) Where a telecommunications business operator provides communications data according to the procedures under paragraphs (3) and (4), he/she shall retain the ledgers prescribed by Presidential Decree, which contain necessary matters, such as the records that communications data are provided, and the related materials, such as the written requests for provision of data.

(6) A telecommunications business operator shall report on the current status, etc. of provision of communications data, to the Korea Communications Commission twice a year, in accordance with the methods prescribed by Presidential Decree, and the Korea Communications Commission may ascertain whether the details of a report submitted by a telecommunications business operator are correct and the management status of related materials under paragraph (5).

(7) A telecommunications business operator shall, in accordance with the methods prescribed by Presidential Decree, notify the details entered in the ledgers under paragraph (5) to the head of the central administrative agency whereto a person requesting the provision of communications data under paragraph (3) belongs: Provided, That in cases where a person who requests the provision of communications data is a court, the relevant telecommunications business operator shall notify the Minister of the Court Administration thereof.

(8)  A telecommunications business operator shall establish and operate a department in exclusive charge of the affairs related to users’communication secrets; and the matters concerning the function, composition, etc. of the relevant development shall be prescribed by Presidential Decree.

(9) Matters necessary for the scope of persons having authority to grant approval on the written requests for provision of data shall be prescribed by Presidential Decree.

Article 84 (Information, etc. of Caller’s Phone Number)

(1) A telecommunications business operator may, upon request from a receiver, inform him/her of a caller’s phone number: Provided, That this shall not apply in cases where the caller expresses his/her intent refusing the transmission of his/her phone number.

(2) Where any of the following cases occurs, a telecommunications business operator may inform a receiver a caller’s phone number, etc, notwithstanding the proviso to paragraph (1);

1. Where the receiver requests to inform the caller’s phone number under conditions and procedures prescribed by Presidential Decree in order to protect the receiver from verbal abuse, threats, harassment, etc.;

2. Where it is prescribed by Presidential Decree for national security, crime prevention, disaster relief, etc. when providing phone services with special numbers.

(3) No person shall fabricate or falsify a caller’s phone number while making phone calls for the purpose of making financial profits by deceiving other persons or of harming them by verbal abuse, threats, harassment, etc.

(4) No person shall provide services for forging or falsely indicating a caller’s phone number for profit-making: Provided, That this shall not apply to any case having justifiable grounds, such as for public interests or offering convenience to the receiver, etc.

Article 85 (Restriction on, and Suspension of Business)

The Korea Communications Commission may order a telecommunications business operator to fully or partially restrict or suspend telecommunications services in order to secure major telecommunications, as prescribed by Presidential Decree at the time of war, an upheaval, natural disaster or any national emergency equivalent thereto or if an outbreak of such emergency is highly apprehended or if extenuating circumstances exist.

Article 86 (Approval for International Telecommunications Services)

(1) When any special provisions concerning international telecommunications services are included in treaties or agreements signed by the Government, those provisions shall govern.

(2) Where a telecommunications business operator intends to enter into an agreement on international telecommunications services prescribed by Presidential Decree, he/she shall obtain approval from the Korea Communications Commission after satisfying the requirements prescribed by Presidential Decree. The same shall apply to an amendment to or revocation of such agreement.

(3) Where a telecommunications business operator who provides common telecommunications services intends to enter into an agreement for the adjustments of international telecommunications service charges with a foreign government or a foreigner, he/she shall report to the Korea Communications Commission: Provided, That this shall not apply to the telecommunications business operator who satisfies the requirements prescribed by Presidential Decree for the size of telecommunications equipment and facilities, capital, whether to grant phone numbers, etc.

(4) Where a telecommunications business operator who provides common telecommunications services intends to enter into an agreement for the adjustments of roaming service charges, he/she shall obtain approval from the Korea Communications Commission, notwithstanding paragraph (3).

(5) Matters necessary for reporting under paragraph (3) or approval under paragraph (4) shall be determined and publicly announced by the Korea Communications Commission.

Article 87 (Cross-Border Provision of Common Telecommunications Services)

(1) Where a person intends to provide common telecommunications services from abroad into Korea without establishing any place of business in Korea (hereinafter referred to as “cross-border provision of common telecommunications services“), he/she shall enter into an agreement for cross-border provision of common telecommunications services with a domestic common telecommunications business operator or special category telecommunications business operator who provides the same common telecommunications services.

(2) Articles 28, 32, 33, 45 through 47, 50 through 55, 83 through 85, 88, 92 of this Act and Article 44-7 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, etc. shall apply mutatis mutandis to the provision of services under an agreement concluded by a common telecommunications business operator or a special category telecommunications business operator under paragraph (1).

(3) Where a person who intends to provide cross-border common telecommunications services under paragraph (1), or a common telecommunications business operator or special category telecommunications business operator who has entered into an agreement with such person, violates the relevant provisions which apply mutatis mutandis under paragraph (2), the Korea Communications Commission may revoke approval under Article 86 (2), or issue an order to fully or partially suspend the cross-border provision of common telecommunications services under the relevant agreement for up to one year.

(4) Guidelines and procedures for imposing dispositions under paragraph (3) and other necessary matters shall be prescribed by Presidential Decree.

Article 88 (Reporting, etc. on Statistics)

(1) A telecommunications business operator shall report to the Korea Communications Commission on the statistics on the provision of telecommunications services prescribed by Presidential Decree, such as the current status of equipment and facilities, subscription record and current status of users for each type of telecommunications services, and the data related to telephone traffic required for billing and collections and retain the related data, as prescribed by Presidential Decree.

(2) A common telecommunications business operator and stockholders thereof, or a special category telecommunications business operator and stockholders thereof shall submit the related data necessary for a verification of matters under Article 8, as prescribed by Presidential Decree.

(3)          In order to verify the matters under paragraph (2), or to examine the genuineness of the data submitted, The Korea Communications Commission may request the administrative agencies and other related agencies to examine the data submitted or to submit the related materials. In such cases, the agencies in receipt of such request shall comply with it unless justifiable grounds exist.

Article 89 (Hearings)

Where the Korea Communications Commission intends to impose any of the following dispositions, it shall hold a hearing:

1. To fully or partially cancel the license of a common telecommunications business operator under Article 20 (1);

2. To fully or partially cancel registration of a special category telecommunications business operator under Article 27 (1);

3. To fully or partially cease the value-added telecommunications business under Article 27 (2);

4. To revoke approval under Article 87 (3).

Article 90 (Imposition, etc. of Penalty Surcharge)

(1) Where a business suspension order to be issued to a telecommunications business operator who falls under each subparagraph of Article 20 (1), each subparagraph of Article 27 (1) or any subparagraph of Article 27 (2), causes substantial inconvenience to the users, etc. of the relevant business or threatens to impair public interests, the Korea Communications Commission may impose a penalty surcharge in an amount not exceeding 3/100 of the turnover calculated under Presidential Decree in lieu of the business suspension order. In such cases, if the telecommunications business operator refuses to submit materials relating to the calculation of the profit or submits any false material, the profit may be estimated based on the financial statements and other accounting materials of the relevant telecommunications business operator and the business operators providing the same or similar types of services, and the materials concerning the current status of business operations, such as the number of subscribers, service charges, etc.: Provided, That where there is no profit or it is difficult to calculate the profit, as prescribed by Presidential Decree, a penalty surcharge not exceeding one billion won may be imposed.

(2) Where an order to suspend the use of private telecommunications equipment and facilities under Article 67 (2) causes substantial inconvenience to the users of telecommunications services provided with the relevant private telecommunications equipment and facilities or threatens to impair public interests, the Korea Communications Commission may impose a penalty surcharge not exceeding one billion won in lieu of the order to suspend the use thereof.

(3) Detailed guidelines for the imposition of penalty surcharges under paragraphs (1) and (2) shall be prescribed by Presidential Decree.

(4) The provisions of Article 53 (5) through (7) shall apply mutatis mutandis to additional dues, demands, and collection of penalty surcharges under paragraphs (1) and (2).

Article 91 (Extension of Payment Deadline of Penalty Surcharges and Payment in Installments)

(1) Where a penalty surcharge to be paid by a telecommunications business operator under Articles 53 and 90 exceeds an amount prescribed by Presidential Decree, and where deemed that the person liable to pay a penalty surcharge has difficulty in paying it in a lump sum on any of the following grounds, the Korea Communications Commission may either extend the payment deadline, or permit him/her to pay it in installments. In such cases, the Commission may, if deemed necessary, require him/her to provide a security therefor:

1. Where he/she suffers a severe financial loss due to natural disasters or fire, etc;

2. Where his/her business faces a serious crisis due to an aggravation of business environments;

3. Where it is expected that he/she will be in great financial difficulty if he/she pays the penalty surcharge in a lump sum.

(2) Matters necessary for an extension of the payment deadline of penalty surcharges, the payment in installments and the provision of a security shall be prescribed by Presidential Decree.

Article 92 (Corrective Orders, etc.)

(1) The Korea Communications Commission shall issue a corrective order to a telecommunications business operator who falls under any of the following subparagraphs:

1. Where he/she violates the provisions of Article 3, 4, 6 through 11, 14 through 24, 26 through 28, 30 through 44, 47 through 49, 51, 56 through 62, 64 through 67, 69, 73 through 75, 79 or 82 through 88, or the orders issued under these provisions;

2. Where the procedures for his/her business operations are deemed to inflict significant harm on the users’ interests;

3. Where he/she fails to promptly take measures necessary for removing an obstruction, such as repair, etc. when an accident, etc. impedes the provision of telecommunications services.

(2) The Korea Communications Commission may order a telecommunications business operator to conduct any of the following matters, when necessary for the development of telecommunications:

1. Integrated operation and management of telecommunications equipment and facilities;

2. Expansion of communications equipment and facilities for the enhancement of social welfare;

3. Establishment and management of communications networks for important communications to achieve efficient performance of the State’s functions;

4. Other matters prescribed by Presidential Decree.

(3) The Korea Communications Commission may order a person who falls under any of the following subparagraphs to suspend the provision of telecommunications services or to take measures necessary for the removal of telecommunications equipment and facilities:

1. A person who operates a common telecommunications business without obtaining a license under Article 6 (1);

2. A person who operates a special category telecommunications business without registration under Article 21 (1);

3. A person who operates the value-added telecommunications business without reporting thereon under Article 22 (1).

Article 93 (Delegation of Authority)

The Korea Communications Commission may partially delegate its authority under this Act to the head of its affiliated agency, as prescribed by Presidential Decree.

CHAPTER VII.- PENAL PROVISIONS

 Article 94 (Penal Provisions)

A person who falls under any of the following subparagraphs shall be punished by imprisonment for not more than five years or by a fine not exceeding 200 million won:

1. A person who operates the common telecommunications business without obtaining a license under Article 6 (1);

2. A person who operates the common telecommunications business, in violation of an order to partially cancel his/her license under Article 20 (1);

3. A person who obstructs the flow of telecommunications by impeding a function of telecommunications equipment and facilities by means of damaging telecommunications equipment and facilities, or contacting the objects with them or by other means, in violation of Article 79 (1);

4. A person who divulges a third party’s confidential information with respect to communications obtained in the course of performance of his/her duties, in violation of Article 83 (2);

5. A person who provides communication data, and a person who receives communications data, in violation of Article 83 (3).

Article 95 (Penal Provisions)

Any of the following persons shall be punished by imprisonment for not more than three years or by a fine not exceeding 150 million won: (Amended by Act nº 10656, May 19, 2011)

1. A person who refuses to provide telecommunications services without justifiable grounds, in violation of Article 3 (1);

2. A person who violates a disposition taken to suspend his/her business operation under Article 20 (1);

3. A person who operates the special category telecommunications business without registration under Article 21 (1);

3-2. A person who conducts value-added telecommunications business without conducting registration under Article 22 (2);

4.  A person who operates a special category telecommunications business, in violation of an order to partially cancel registration under Article 27 (1);

5. A person who fails to comply with an order under Article 52 (1);

6. A person who obstructs the measurement of lines, etc. and the installation and preservation works for telecommunications equipment and facilities under Article 73 (2);

7. A person who violates the confidentiality of communications of telecommunications business operators or divulges such confidential information, in violation of Article 83 (1).

Article 96 (Penal Provisions)

A person who falls under any of the following subparagraphs shall be punished by imprisonment for not more than two years or by a fine not exceeding 100 million won:

1. A person who fails to obtain a revised license under Article 16;

2. A person who fails to obtain approval under Articles 17 (1) and 42 (4);

3. A person who fails to obtain authorization under the main sentence of the part other than each subparagraph of Article 18 (1) or approval under Article 19 (1);

4. A person who integrates telecommunications networks, appoints executives, acquires business, executes an agreement for merger or sale of equipment and facilities, or takes follow-up measures for the establishment of a company prior to obtaining authorization, in violation of Article 18 (9):

5. A person who fails to comply with an order to take measures to protect users under Article 19 (2);

6. A person who operates a value-added telecommunications business without reporting under Article 22 (1);

7. A person who violates a disposition taken to suspend his/her business operation under Article 27 (1);

8. A person who fails to comply with an order to discontinue his/her business under Article 27 (2);

9. A person who fails to purchase a guarantee insurance policy, in violation of Article 32 (3)

10. A person who discloses, uses or provides information, in violation of the main sentence of Article 43 (1) or paragraph (2) of the same Article;

11. A person who fails to comply with an order to restrict or suspend telecommunications services under Article 85;

12. A person who fails to obtain approval or approval for an amendment or revocation, under Article 86 (2) or (4).

Article 97 (Penal Provisions)

A person who falls under any of the following subparagraphs shall be punished by imprisonment for not more than one year or by a fine not exceeding 50 million won:

1. A person who fails to comply with an order under Article 10 (5), 12 (2) (including cases where the provisons apply mutatis mutandis under Article 4 (4) of the Addenda of the Telecommunications Business Act amended by Act nº 5385) or 18 (8);

2. A person who fails to report under the proviso to Article 18 (1);

3. A person who fails to file a revised registration or a revised report under Article 23;

4. A person who fails to report under Article 24;

5. A person who violates a disposition taken to suspend his/her business operation under Article 27 (2);

6. A person who provides telecommunications services without submitting a report or revised report under Article 28 (1) and (2) (proviso) or without obtaining authorization or revised authorization under Article 28 (2);

7. A person who advocates a third party’s communications through telecommunications services provided by a telecommunications business operator or provides such services for a third party’s communications, in violation of the body of Article 30.

Article 98 (Penal Provisions)

A person who falls under any of the following subparagraphs shall be punished by imprisonment for not more than one year or by a fine not exceeding 100 million won:

1. A person who installs or changes important telecommunications equipment and facilities without reporting under the main sentence of Article 62 (1) or a person who installs telecommunications equipment and facilities without obtaining approval under the proviso to Article 62 (1);

2. A person who installs private telecommunications equipment and facilities without submitting a report or a revised report under Article 64 (1);

3. A person who advocates a third party’s communications through private telecommunications equipment and facilities or operates such equipment and facilities not in accordance with the purposes of installation, in violation of Article 65 (1);

4. A person who fails to comply with an order to carry out the telecommunications business or other important communications business or to connect his/her equipment and facilities with other telecommunications equipment and facilities under Article 66 (1);

5. A person who fails to comply with an order to suspend the use under Article 67 (2) or an order under Article 67 (3);

6. A person who fails to comply with an order to remove telecommunications equipment and facilities or an order to take other necessary measures under Article 82 (2).

Article 99 (Penal Provisions)

A person who commits a prohibited act under each subparagraph of Article 50 (1) (excluding any act of providing telecommunications services in a manner different from the terms and conditions of use under Article 50 (1) 5) shall be punished by a fine not exceeding 300 million won.

Article 100 (Penal Provisions)

A person who falls under any of the following subparagraphs shall be punished by a fine not exceeding 50 million won:

1. A person who fabricates or falsifies a caller’s phone number while making a phone call for the purpose of making financial profits by deceiving other persons or of harming them by verbal abuse, threats, sexual harassment, etc., in violation of Article 84 (3);

2. A person who provides services for fabricating for falsifying a caller’s phone number for profit-making, in violation of Article 84 (4).

Article 101 (Penal Provisions)

A person who contaminates telecommunications equipment and facilities or damages measurement marks of telecommunications equipment and facilities, in violation of Article 79 (2) shall be punished by a fine or a minor fine not exceeding one million won.

Article 102 (Attempted Criminals)

An attempted criminal under subparagraphs 3 and 4 of Article 94 and subparagraph 7 of Article 95 shall be punished.

Article 103 (Joint Penal Provisions)

When a representative of a corporation or an agent, an employee or any other employed person of a corporation or an individual commits any violation under Articles 94 through 100 in connection with the business of such corporation or individual, not only shall such violator be punished accordingly, but the corporation or individual shall be punished by a fine under the relevant provisions, respectively: Provided, That the same shall not apply in cases where the corporation or individual has paid due attention to or diligently supervised the relevant business in order to prevent such violation.

Article 104 (Fines for Negligence)

(1) A person who falls under any of the following subparagraphs shall be punished by a fine for negligence not exceeding 30 million won:

1. A person who impedes a temporary use of private telecommunications equipment and facilities or land, etc. without any justifiable ground, in violation of Article 73 (2);

2. A person who impedes an entrance to land, etc. without any justifiable ground, in violation of Article 74 (2);

3. A person who refuse to relocate, reform or repair obstacles, etc. or to take other necessary measures under Article 75 (1) or to remove plants under Article 75 (2) without any justifiable ground.

(2) A person who fails to apply for authorization on the conclusion of an agreement, in violation of Article 44 (2) shall be punished by a fine for negligence not exceeding 200 million won.

(3) A person who falls under any of the following subparagraphs shall be punished by a fine for negligence not exceeding 15 million won:

1. A person who fails to report on the conclusion of an agreement under Article 44 (1);

2. A person who fails to report under the main sentence of Article 86 (3).

(4) A person who falls under any of the following subparagraphs shall be punished by a fine for negligence not exceeding 10 million won:

1. A person who fails to report under Article 10 (2) or fails to comply with a request for the provision of necessary data or an order to appear under Article 11 (3) or (4);

2. A person who fails to notify users by not later than 60 days before a scheduled date of suspension or discontinuance, in violation of Article 19 (1);

3. A person who fails to report under Article 26;

4. A person who violates duties to protect users under Article 32 (1);

5. A person who fails to comply with an order to submit data issued by the Korea Communications Commission under Article 35 (5) or submits false data;

6. A person who fails to publicly announce the technical standards, the requirements for the provision and use, and other standards required for the creation of environments for fair competition, in violation of Article 42 (4);

7. A person who fails to comply with the matters publicly announced under Article 48 (2), in violation of Article 48 (3);

8. A person who refuses, avoids or impedes an investigation under Article 51 (2);

9. A person who refuses, avoids or impedes an order to submit necessary data or articles under Article 51 (5), or temporary custody of such data or articles;

10. A person who fails to comply with an order to submit data under Article 56 (3);

11. A person who uses private telecommunications equipment and facilities without verification, in violation of Article 64 (3);

12. A person who refuses, interferes with or avoids an inspection under Article 82 (1);

13. A person who fails to report under Article 82 (1) or falsely reports;

14. A person who fails to retain the related materials or retains false materials, in violation of Article 83 (5);

15. A person who fails to notify details of the ledgers which include the provision of communications data, etc. to the head of a central administrative agency, in violation of Article 83 (7);

16. A person who fails to report or submit data under Article 88, or falsely reports or submits false materials;

17. A person who fails to comply with a corrective order under Article 92.

(5) Fines for negligence under paragraphs (1) through (4) shall be imposed and collected by the Korea Communications Commission, as prescribed by Presidential Decree.

ADDENDA

Article 1 (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation.

Article 2 (Term of Validity)

The amended provisions of Article 38 (2) through (4) shall be valid for three years from the date this Act enters into force.

Article 3 (Transitional Measures concerning Scope of Application)

The former provisions of the Addenda shall apply even after this Act enters into force.

Article 4 (Transitional Measures concerning Licenses of Common Telecommunications Business Operators)

A common telecommunications business operator who has obtained a license under the former provisions to operate common telecommunications business as at the time this Act enters into force shall be deemed a common telecommunications business operator who has obtained a license under the amended provisions of Article 6 to operate common telecommunications business under the amended provisions of Article 5 (2).

Article 5 (Transitional Measures concerning Guarantee Insurance)

A special category telecommunications business operator registered under the former provisions as at the time this Act enters into force who has collected service charges from users in advance, and then purchased a guarantee insurance policy to provide services, shall be deemed to have purchased a guarantee insurance policy under the amended provisions of Article 32 (3).

Article 6 (Transitional Measures concerning Penal Provisions, etc.)

In applying penal provisions or provisions concerning the fine for negligence against a violation committed before this Act enters into force, the former provisions shall apply: Provided, That this Act shall apply in cases where the application of the provisions of this Act is favorable to a violator.

Article 7 Omitted.

Article 8 (Transitional Measures following Amendment to Other Acts)

In applying penal provisions or provisions concerning fines for negligence against a violation of the former Framework Act on Telecommunications (referring to the Framework Act on Telecommunications before the amendment under Article 7 (5) of this Addenda), the former Framework Act on Telecommunications shall apply.

Article 9 (Relations with Other Acts and Subordinate Statutes)

A citation of the former Framework Act on Telecommunications and the former Telecommunications Business Act or any provision thereof by any other Act or subordinate statute in force as at the time this Act enters into force shall be deemed a citation of this Act or a corresponding provision thereof in lieu of the former provisions, if such corresponding provision exists in this Act.

ADDENDA (Act nº 10656, May. 19, 2011)

(1) (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation.

(2) (Transitional Measures concerning Registration of Value-added Telecommunications Business)

Among those who conduct value-added telecommunications business in accordance with the former provisions as at the time this Act enters into force, any person who needs to make registration in accordance with the amended provisions of Article 22 (2) shall make registration within six months after this Act enters into force.

ADDENDA (Act nº 11201, Jan. 17, 2011)

Article 1 (Enforcement Date)

This Act shall enter into force six months after the date of its promulgation.

Article 2 (Applicability to Notification)

The amended provisions of Article 32-2 shall apply, starting with the first person who enters into a contract for the use of telecommunications services with a telecommunications business operator after this Act enters into force.

27Oct/21

Telecommunications Business Act, December 30, 1983

Telecommunications Business Act, December 30, 1983 (Amended December 26, 2002, Amended by Act nº 5385, Act nº 6230, Jan 28, 2000, Act nº 8867, Feb 29, 2008, Act nº 9481, March 15, 2009, Act nº 10656, May 19, 2011, effective Nov. 20, 2011).

CHAPTER I.- GENERAL PROVISIONS

Article 1 (Purpose)

The purpose of this Act is to contribute to the promotion of public welfare by encouraging sound development of telecommunications business and ensuring convenience to the users of telecommunications service through proper management of such business.

Article 2 (Definitions)

The definitions of the terms as used in this Act shall be as follows: (Amended by Act nº 10656, May 19, 2011)

1. the term “telecommunication” means sending and receiving of sign, wording, sound or image through wired, wireless, optic or other electronic means;

2. the term “telecommunication facilities” means equipments, devices, lines and other facilities necessary for telecommunication;

3. the term “telecommunication line facilities” means telecommunication line portion of the telecommunication facilities which is necessary for sending, receiving and routing telecommunication and include exchange equipments and other annexed facilities;

4. the term “commercial telecommunication facilities” means telecommunication facilities for providing telecommunication business;

5. the term “proprietary telecommunication facilities” means telecommunication facilities other than commercial telecommunication facilities that a person installs for his own telecommunication use;

6. the term “telecommunication service” means connecting of customer’s communication through the use of telecommunication facilities or providing telecommunication facilities for customer’s communication;

7. the term “telecommunication business” means the business of providing telecommunication service;

8. the term “telecommunications business operator” means a person who provides telecommunications service with holding a license or making a registration or report under this Act;

9. the term “user” means a person who has made a contract for the use of any telecommunications service with the telecommunications business operator in order to receive a provision of telecommunications service;

10. the term “universal service” means the basic telecommunications service which any user may receive at reasonable fees anytime and anywhere;

11. the term “key communication service” means the telecommunication service such as telephone and internet services which transmit or receive voice, data, image, etc. without changing their content and the telecommunication service where telecommunication line facilities is lent for transmission and receipt of voice, data, image, etc., provided, however that individual telecommunication services determined and announced by the Korea Communications Commission (individual telecommunication service under Article 6) are excluded;

12. the term “value-added telecommunication service” means telecommunication services other than key communication services;

13. the term “special type of value-added communications services” means each of the following services:

A. value-added communications services provided by “special type of online service providers” as the term, “special type of online service providers,” is defined in Article 104 of the Copyright Act;

B. any value-added communications services provided by and among individuals which, by using computers, store or send, or aim at sending, any information defined in Article 3(1) of the Framework Act on National Informatization.

Article 3 (Duty of Providing Services, etc.)

(1) A telecommunications business operator shall not refuse to provide any telecommunications service, without justifiable reasons.

(2) A telecommunications business operator shall guarantee the fairness, speediness and accuracy in performing his business.

(3) A fee for telecommunications service shall be reasonably fixed so as to ensure a smooth development of telecommunications business and to provide the users with convenient and diverse telecommunications services in the fair and inexpensive manner.

Article 4 (Universal Service)

(1) All telecommunications business operators shall have the obligation to provide universal service or to replenish the losses incurred by such provisions.

(2) The Communications Commission may, notwithstanding the provisions of paragraph (1), exempt the telecommunications business operator in each of the following subparagraphs from the obligation specified paragraph (1) above:

1. the telecommunications business operator determined by the Enforcement Decree as a telecommunications business operator for whom an imposition of obligation under paragraph (1) is deemed inadequate in view of the peculiarity of telecommunications service

2. the telecommunications business operator whose turnover of telecommunications service is less than the amount as determined by the Enforcement Decree within the limit of 1/100 of total turnover of the telecommunications services, from the relevant obligations.

(3) The details of universal service shall be determined by the Enforcement Decree in consideration of the following matters:

1. Level of the development of information and communications technology;

2. Level of the dissemination of telecommunications service;

3. Public interest and safety;

4. Promotion of social welfare; and

5. Acceleration of informatization.

(4) In order to provide effective, stable universal service, the Korea Communications Commission may, in consideration of size and quality of universal service, level of price and the technical capability of a telecommunications business operator, designate a telecommunications business operator through the method and procedure prescribed by the Enforcement Decree.

(5) Under the method and procedure prescribed by the Enforcement Decree, the Korea Communications Commission may have a telecommunications business operator bear compensation for losses incurred in the course of providing universal service based on the total sales.

CHAPTER II.- TELECOMMUNICATIONS BUSINESS

SECTION 1.- General Provisions

Article 5 (Classification, etc. of Telecommunications Business)

(1) The telecommunications businesses shall be classified into a key communications business, a specific communications business and a value-added communications business.

(2) The key communications business shall be the business to install telecommunication line facilities, and thereby provide the key telecommunication service by making use of telecommunication line facilities.

(3) The specific communications business shall correspond to one of the following subparagraphs:

1. Business which provides a key communications service by making use of telecommunication line facilities, etc. of a person who has obtained a license for key communications business under Article 6 (hereinafter referred to as a “key communications business operator”); and

2. Business which installs the telecommunications facilities in the premises as determined by the Enforcement Decree, and provides a telecommunications service therein by making use of the said facilities.

(4) The value-added communications business shall be the business providing value-added communication services.

SECTION 2.- Key Communications Business

Article 6 (License etc. of Key Communications Business Operator)

(1) A person who intends to run a key communications business shall obtain a license from the Korea Communications Commission.

(2) The Korea Communications Commission shall, in granting a license under paragraph (1), comprehensively examine the matters falling under each of the following subparagraphs:

1. financial capability necessary for implementing the key communication service plan;

2. technical capability necessary for implementing the key communication service plan,

3. adequacy of plans for a user protection;

4. other matters relevant to capacity for providing stable key communication services as determined under the Enforcement Decree of the Act.

(3) The Communications Commission shall set forth the detailed examination criteria by examining item under paragraph (2), period for license and outline of application for license, and make a public announcement thereof

(4) The Korea Communications Commission may, in case where it grants a license for key communications business under paragraph (1), attach the conditions necessary for the promotion of fair competition, protection of users, improvement of service quality and efficient employment of resources for information and communication, in this case such conditions shall be published on its official publication and official webpage.

(5) A person subject to a license under paragraph (1) shall be limited to a juristic person.

(6) Procedures for a license under paragraph (1) and other necessary matters shall be determined by the Enforcement Decree.

Article 7 (Reasons for Disqualification for License)

Persons falling under each of the following subparagraphs shall not be entitled to obtain the license for a key communications business as referred to in Article 6:

1. The State or local governments;

2. Foreign governments or foreign corporations; and

3. Corporations whose stocks are owned by foreign governments or foreigners in excess of the restrictions on stock possessions as referred to in Article 8 (1).

Article 8 (Restrictions on Stock Possessions of Foreign Governments or Foreigners)

(1) The stocks of a key communications business operator (excluding non-voting stocks under Article 370 of the Commercial Act, and including the stock equivalents with voting rights, such as stock depositary receipts, etc. and investment equities; hereinafter the same shall apply) shall not be owned in excess of 49/100 of the gross number of issued stocks, when adding up all of those owned by the foreign governments or foreigners.

(2) A corporation whose largest stockholder(hereinafter referred to as the “largest stockholder “) under Article 9(1)1 of the Financial Investment Services and Capital Markets Act is a foreign government or a foreigner (including, throughout this Act, a specially-related person under Article 9(1)1 of the Financial Investment Services and Capital Markets Act) and not less than 15/100 of the gross number of its issued stocks is owned by said foreign government or foreigner (hereinafter referred to as the “fictitious corporation of foreigners”) shall be regarded as a foreigner.

(3) A corporation that owns less than 1/100 of the gross number of stocks issued by a key communications business operator shall not be regarded as a foreigner, even if it is equipped with the requirements as referred to in paragraph (2).

Article 9 (Grounds for Disqualifying Officers)

(1) Any person falling under each of the following subparagraphs shall be disqualified to serve as an officer of any key communications business operator:

1. A minor, an incompetent or a quasi-incompetent;

2. A person who has yet to be reinstated after having been declared bankrupt;

3. A person who has been sentenced to imprisonment without prison labor or a heavier punishment on charges of violating this Act, the Framework Act on Telecommunications, the Radio Waves Act or the Act on Promotion of Information and Communications Network Utilization and Information Protection (excluding matters not directly related to telecommunication business, hereinafter “this Act, etc.”), and for whom three years have yet to pass from the date on which the execution of the sentence is terminated (including a case where the execution of the sentence is deemed to be terminated) or the execution of the sentence is exempted;

4. A person who is in a stay period after having been sentenced to a stay of the execution of the imprisonment without prison labor or a heavier punishment on charges of violating this Act, etc.;

5. A person who has been sentenced to a fine on charges of violating this Act, etc. and for whom one years have yet to pass from the date of such sentence; and

6. A person who has been subject to a disposition taken to revoke all or part of his permission in accordance with Article 20 (1), a disposition taken to revoke all or part of his registration in accordance with Article 27 (1), or an order given in accordance with paragraph (2) of the same Article to discontinue all or part of his business and for whom three years have yet to pass from the date of such disposition or order. In the case of a corporation, the person refers to the person who commits the act of causing the disposition to revoke permission, the disposition to revoke registration or the order to discontinue business, and its representative.

(2) In the event that any officer is found to fall under each subparagraph of paragraph (1) or is found to fall under each subparagraph of paragraph (1) at the time that he is selected and appointed as an officer, he shall rightly resign from the office.

(3) Any act in which any officer has been involved prior to his resignation under paragraph (2) shall not lose its legal efficacy.

Article 10 (Examination of Public Interest Nature of Stock Acquisition, etc. by Key Communications Business Operator)

(1) The Public Interest Nature Examination Committee (hereinafter referred to as the “Committee”) shall be established in the Korea Communications Commission in order to make an examination regarding whether or not  what falls under each of the following subparagraphs impedes the public interests as prescribed by the Enforcement Decree (hereinafter referred to as the “examination of public interest nature”), such as the national safety guarantee and maintenance of public peace and order, etc:

1. Where the principal comes to own not less than 15/100 of the gross number of stocks issued by a key communications business operator, when adding up those owned by the specially-related person as referred to in Article 9 paragraph (1) subparagraph 1 of the Capital Market Integration Act(hereinafter referred to as the “specially-related person”);

2. Where the largest stockholder of a key communications business operator is altered;

3. Where a key communications business operator or any stockholder of a key communications business operator concludes a agreement for important management matters as prescribed by the Enforcement Decree, such as the appointment and dismissal of executives and the transfer or takeover, etc. of business of the relevant key communications business operator, with a foreign government or a foreigner; and

4. Other cases as prescribed by the Enforcement Decree, where there exists a change in the stockholders who have de facto management rights of a key communications business operator.

(2) Where a key communications business operator or any stockholder of a key communications business operator comes to fall under each of subparagraphs of paragraph (1), he shall file a report thereon with the Korea Communications Commission within thirty days from the time when such a fact took place.

(3) Where a key communications business operator or any stockholder of a key communications business operator is to come to fall under each of subparagraphs of paragraph (1), he may, prior to the said situation, request the Korea Communications Commission to make an examination as referred to in paragraph (1).

(4) Where the Korea Communications Commission has received a report as referred to in paragraph (2) or a request for examination as referred to in paragraph (3), it shall refer it to the Committee.

(5) Where the Korea Communications Commission judges that there exists a danger of impeding the public interests by the cases falling under each of subparagraphs of paragraph (1) in view of the result of examination as referred to in paragraph (1), it may order the alteration of agreement detail and suspension of its implementation, the suspension of exercise of voting rights, or the sale of relevant stocks.

(6) The report as referred to in paragraph (2) or (3), or the scope of key communications business operators to be examined of public interest nature, the procedures for reports and examinations of public interest nature and other necessary matters shall be stipulated by the Enforcement Decree.

Article 11 (Composition and Operation, etc. of Public Interest Nature Examination Committee)

(1) The Committee shall consist of not less than five but not more than ten members including one Chairman.

(2) The Chairman of the Committee shall be the Vice Chairman of the Korea Communications Commission, and the members shall be the persons commissioned by the Chairman from among the public officials ranking Grade III or higher grade of related central administrative agencies or public officials who belong to senior executive service as specified by the Enforcement Decree of the Act, and falling under each of the following subparagraphs:

1. Persons having profound knowledge and experiences in the information and communications;

2. Persons recommended by the Government-contributed research institutes relating to the national safety guarantee and maintenance of public peace and order;

3. Persons recommended by the nonprofit non-governmental organizations as referred to in Article 2 of the Assistance for Nonprofit Non-Governmental Organizations Act; and

4. Other persons deemed necessary by the Chairman.

(3) The Committee may conduct necessary investigations for the examination of public interest nature, or request the interested parties or the reference witnesses to provide the data. In such case, the relevant interested parties or the reference witnesses shall comply with it unless they have any justifiable reasons.

(4) Where the Committee deems it necessary, it may have the interested parties or the reference witnesses attend the Committee, and hear their opinions. In such case, the relevant interested parties or the reference witnesses shall comply with it unless they have any justifiable reasons.

(5) Matters necessary for the organization or operation, etc. of the Committee shall be prescribed by the Enforcement Decree.

Article 12 (Restrictions, etc. on Stockholders of Excessive Possession)

(1) Where a foreign government or a foreigner has acquired the stocks in contravention of the provisions of Article 8 (1), no voting rights shall be exercised for the stocks under the said excessive possession.

(2) The Korea Communications Commission may order the stockholder who has acquired stocks in contravention of the provisions of Article 8 (1), a key communications business operator wherein exists the said stockholder, or the stock-holder of the fictitious corporation of foreigners, to make corrections in the relevant matters, with specifying the period within the limit of six months

(3) Persons subjected to the order for corrections as referred to in paragraph (2) shall make corrections in the relevant matters within the specified period.

(4) With regard to the stockholder in contravention of the provisions of Article 8 (1), a key communications business operator may refuse any renewals for the excessive portion in the register of stockholders or of members.

Article 13 (Charge for Compelling Execution)

(1) Against the persons who were subjected to the orders as referred to in Articles 10 (5) or 12 (2) or 18 (8)(hereinafter referred to as the “corrective orders”) and has failed to comply with them within the specified period, the Communications Commission may levy the charge for compelling the execution. In such case, the charge for compelling the execution leviable per day shall be not more than 3/1,000 of purchase prices of relevant possessed stocks, but in the case not related with the stock possession, it shall be the amount not exceeding 100 million won.

(2) The period subject to a levy of the charge for compelling the execution as referred to in paragraph (1) shall be from the day next to the date of expiration of the period set in the corrective orders to the date of implementing the corrective orders. In such case, a levy of the charge for compelling the execution shall be made within 30 days from the day next to the expiration date of the period set in the corrective orders, except for the case where there exists a special reason.

(3) Provisions of Article 53 (5) shall apply mutatis mutandis to the collection of the charge for compelling the execution.

(4) Matters necessary for the levy, payment, refund, etc. of the charge for compelling the execution shall be prescribed by the Enforcement Decree.

Article 14 (Issuance of Stocks)

A key communications business operator shall, in a case of an issuance of stocks, issue the registered ones

Article 15 (Obligation of Commencing Business)

(1) A key communications business operator shall install telecommunications facilities and commence business within the period as fixed by the Korea Communications Commission.

(2) The Korea Communications Commission may, in case where the said business operator is unable to commence business within the period under paragraph (1) due to force majeure and other unavoidable reasons, extend the relevant period only once, upon an application of the key communications business operator.

Article 16 (Modification of License)

(1) Where a key communications business operator intends to modify the important matters prescribed by the Enforcement Decree from among the matters licensed under Article 6, he shall obtain a modified license from the Korea Communications Commission, under the conditions as prescribed by the Enforcement Decree.

(2) The provisions of Articles 6 (4) and Article 15 shall be applicable mutatis mutandis to a modified license for change under paragraph (1).

Article 17 (Concurrent Operation of Business)

(1) A key communications business operator shall, in case where he intends to run any of the businesses set forth in the following subparagraphs, obtain approval from the Korea Communications Commission: Provided that, this provision shall not apply to any key communications business operator with less than 30,000,000,000 Korean Won in turnover of services.

1. manufacturing of telecommunications tools

2. information and communications work pursuant to paragraph 3 of Article 2 of the Information and Communications Work Business Act (excluding renovation and consolidation work for electronic telecommunications network)

3. services pursuant to subparagraph 6 of Article 2 of the Information and Communications Work Business Act (excluding renovation and consolidation of electronic telecommunications network).

(2) The Korea Communications Commission shall grant approval under paragraph (1), in case where deemed that a key communications business operator is not likely to cause any impediments to the operation of telecommunications service by running a business under paragraph (1), and that it is required for the development of telecommunications.

Article 18 (Takeover of Business and Merger of Juristic Persons etc.)

(1) A person who belongs to any one of the categories set forth in the following paragraphs shall obtain an authorization from the Korea Communications Commission under the conditions as prescribed by the Enforcement Decree: Provided, notwithstanding subparagraph 3 below, that in case that person sells telecommunications circuit installations except the ones prescribed by the Enforcement Decree, he shall report it to the Korea Communications Commission under the conditions as determined by the Enforcement Decree

1. a person who takes or intends to take over the whole or part of a key communications business

2. a person who intends to merge with a juristic person which is a key communications business operator

3. a key communications business operator intending to sell the telecommunications circuit installations necessary for provision of key communications service

4. a person who, along with a certain related person intends to become the largest shareholder of a key communications business operator or own 15% of more of the issued shares of the key communications business operator.

5. a person seeking to acquire control over a key communication business operator by acquiring shares or entering into an agreement, as specified by the Enforcement Decree of the Act

6. a key communication business operator seeking to establish a company to provide part of the key communication services provided under authorization through such company.

(2) The Korea Communications Commission shall, in case where it intends to grant authorization under paragraph (1), comprehensively examine the matters falling under each of the following subparagraphs:

1. Appropriateness of financial and technical capability and business operational capability;

2. Appropriateness of management of resources for information and communications, such as frequencies and telecommunications numbers, etc.;

3. Impact on the competition of key communications business; and

4. Impact on the protection of users and the public interests.

5. Impact on public interests, such as the use of telecommunications facilities and communication networks, efficiency of research and development and international competitive power of the communications industry, etc.

(3) Matters necessary for the detailed examination standards by examination items and the examination procedures, etc. under paragraph (2) shall be fixed and publicly announced by the Korea Communications Commission

(4) A person falling under any of the following shall succeed to the telecommunication licensee status of the key communication business operator:

1. A person who has taken over the business of a key communications business operator by obtaining an authorization under paragraph (1)

2. a juristic person surviving a merger or that established by a merger, or that established by obtaining an authorization under paragraph (2)

3. a company incorporated to provide part of key communication services with the approval under paragraph (1)6

(5) The Korea Communications Commission may, in case where it grants authorization or authorization under paragraph (1), attach conditions under Article 6(4).

(6) The Korea Communications Commission shall, in case where it intends to grant an authorization under paragraph (1), go through a consultation with the Fair Trade Commission. (Amended by Act nº 6230, Jan. 28, 2000; Act nº 8867, Feb. 29, 2008; Act nº 9481, March 13, 2009)

(7) In regard to the criteria for rejection of authorization in paragraph (1), Article 7 shall be applicable mutatis mutandis.

(8) In the event any person/entity subject to Article 1(4) or (5) fails to acquire the permit pursuant thereto, the Korea Communications Commission may order suspension of its voting right or sale of the applicable shares, and if the conditions attached under paragraph (5) are not carried out, may order such performance within a specific time frame.

(9) A person seeking authorization under paragraph (1) shall not do each of the following prior to obtaining such authorization:

1. unify communications networks,

2. appoint officers,

3. transferring, consolidating, entering into contract concerning disposing of facilities or

4. take follow-up measures regarding establishment of a company.

(10) Where a person falling under each of subparagraphs of paragraph (1) is subject to the examination of public interest nature, the person may submit the documents required for the examination of public interest nature at the same time when the person applies for the authorization under paragraph (1).

Article 19 (Suspension, Closedown of Business or Dissolution of Juristic Persons, etc.)

(1) A key communications business operator shall, in case where he intends to suspend or discontinue the whole or part of a key communications business run by him, as specified by the Enforcement Decree of the Act notify the users at least 60 days prior to the date of termination and obtain approval of such suspension or discontinuation from the Korea Communications Commission.

(2) In the event separate measures of protection is deemed to be necessary for the protection of users upon suspension or discontinuance of the relevant key communications business, the Korea Communications Commission may order such measures (including assistance for membership change, bearing expenses, termination of membership) to be taken.

(3) The Korea Communications Commission shall, in case where an application for approval or authorization under paragraph (1) is made, and where deemed that suspension, discontinuance of relevant business or a dissolution of a juristic person is likely to hamper the public interests, not grant the relevant approval or authorization.

Article 20 (Cancellation of License, etc.)

(1) The Korea Communications Commission may, in case where a key communications business operator falls under any one of the following subparagraphs, cancel whole or part of the relevant license or give an order to suspend the whole or part of business with fixing a period of no more than one year, provided that the license shall be cancelled entirely or partially if paragraph 1 is applicable:

1. Where he has obtained a license by deceit and other illegal means;

2. Where he has failed to implement the conditions under Articles 6 (4) and 18 (5);

3. Where he has failed to observe the orders under Article 12 (2);

4. Where he has failed to commence business within the period under Article 15 (1) (in case of obtaining an extension of the period under Article 15 (2), the extended period);

5. Where he has failed to comply with the standardized terms and conditions, that is authorized or reported under Article 28 (1) and (2); and

6. Where he fails to comply with an order for correction under Article 52 (1) or Article 92 (1) without any justifiable reasons.

(2) Criteria and procedures for the dispositions under paragraph (1) and other necessary matters shall be determined by the Enforcement Decree.

SECTION 3.- Specific Communications Business and Value-Added Communications Business

Article 21 (Registration of Specific Communications Business Operator)

(1) A person who intends to operate a specific communications service shall register the following matters with the Korea Communications Commission (including registration through information network) under the conditions as determined by the Enforcement Decree:

1. Financial and technical capability;

2. Plans for a user protection; and

3. Business plans, etc. and other matters as determined by the Enforcement Decree.

(2) The Korea Communications Commission may, upon receipt of the registration of a specific communications business under paragraph (1), attach the conditions necessary for the promotion of fair competition, protection of users, improvement of service quality and efficient employment of resources for information and communication.

(3) A person subject to the registration of specific communications business under paragraph (1) shall be limited to a juristic person.

(4) A person who registered his specific communications business under paragraph (1) (hereinafter referred to as a “specific communications business operator”) shall commence operation within 1 year from the registration date.

(5) Procedures and requirements for the registration under paragraph (1) and other necessary matters shall be determined by the Enforcement Decree.

Article 22 (Report, etc. of Value-Added Communications Business Operator)

(1) A person who intends to run a value-added communications business shall report to the Korea Communications Commission (including reports via information network), according to the requirements and procedures as prescribed by the Enforcement Decree: Provided, That this shall not apply to a case where the size of capital, etc. is a small value-added communication business matching the criteria prescribed by the Enforcement Decree.

(2) Notwithstanding the provisions of paragraph (1), a person who intends to operate a special type of value-added communications business shall register such business with the Korea Communications Commission (including registration through information network) after satisfying the following requirements: (Newly Inserted by Act No. 10656, May 19, 2011)

1. a plan for implementing technical measures in order to perform the provisions of Articles 42, 42-2, 42-3, 45 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc. and Article 104 of the Copyright Act;

2. personnel and physical facilities necessary for providing services;

3. financial soundness; and

4. any other matters as prescribed by the Enforcement Decree such as a business plan.

(3) Upon receipt of the registration of a value-added communications business pursuant to paragraph (2), the Korea Communications Commission may set conditions necessary to implement the plan referred to in subparagraph 1 of paragraph (2). (Newly Inserted by Act No. 10656, May 19, 2011)

(4) When a key communications business operator seeks to operate value-added communication services, such value-added communication services are deemed to have been reported. (Amended by Act nº 10656, May 19, 2011)

(5) A person who reported a value-added communications business under the first part of paragraph (1) or a person who registered such business under paragraph (2) shall commence operation within 1 year from the reporting date or registration date respectively. (Amended by Act nº 10656, May 19, 2011)

(6) Procedures and requirements for the report under the first part of paragraph (1) and the registration under paragraph (2), and other necessary matters shall be determined by the Enforcement Decree. (Newly Inserted by Act No. 10656, May 19, 2011)

Article 22-2 (Reasons for Disqualification for Registration)

An individual, a juristic person for whom three years have yet to pass from the date on which the registration of his/its business is canceled pursuant to Article 27(2), or the major shareholder of such juristic person at the time of such cancellation (an investor as prescribed by the Enforcement Decree) may not make a registration under Article 22(2).

[This Article Newly Inserted by Act No. 10656, May 19, 2011]

Article 23 (Modification of Registered or Reported Matters)

Specific communications business operator, a person who has made a report of a value-added communications business operator under the earlier part of Article 22(1), or a person who has made a registration of a value-added communications business under Article 22(2) shall, when he intends to modify the matters as determined by the Enforcement Decree from among the relevant registered or reported matters, make in advance a modified registration or modified report (including modified registration or modified report through information network) to the Korea Communications Commission under the conditions as prescribed by the Enforcement Decree.

(Amended by Act nº 10656, May 19, 2011)

Article 24 (Transfer or Takeover, etc. of Business)

In case where there exists a transfer or takeover of the whole or part of a specific communications business or a value-added communications business, or a merger or succession of a juristic person which is a specific communications business operator or a value-added communications business operator (a person who has reported value-added communications services pursuant to the first part of Article 22(1), a person who has made a registration of a value-added communications business under Article 22(2) or is deemed to have made such reporting under the latter part of paragraph (1) of the same Article or paragraph (4) of the same Article, hereinafter refer to the same), each of the following persons shall make the report thereon (including reports through information network) to the Korea Communications Commission, according to the requirements and procedures as prescribed by the Enforcement Decree: (Amended by Act nº 10656, May 19, 2011)

1. a person who has taken over the relevant business,

2. the juristic person surviving the merger, the juristic person founded by the merger, or

3. the successor to the business in question

Article 25 (Succession of Business)

In case where there have existed a transfer or takeover of a specific communications business or a value-added communications business, a merger of a juristic person which is a specific communications business or a value-added communications business operator, or a succession of a value-added communications business, under Article 24, each of the following persons shall succeed to the status of a former specific communications business operator or a value-added communications business operator.

1. a person who has taken over the business,

2. a juristic person surviving a merger, or a juristic person founded by a merger or

3. a successor to the business

Article 26 (Suspension or Closedown, etc. of Business)

(1) A specific communications business operator or a value-added communications business operator shall, in case where he intends to suspend or close down the whole or part of his business, in a manner determined in the Enforcement Decree of the Act, notify the relevant contents to the users of relevant services, and report thereon to the Korea Communications Commission (including reports through information network) not later than thirty days prior to the slated date of the relevant suspension or closedown. In this case, the business shall not be continually suspended for more than 1 year.

(2) Where a juristic person which is a specific communications business operator or a value-added communications business operator is dissolved for reasons other than a merger, a relevant liquidator (referred to a trustee in a bankruptcy, when it is dissolved by bankruptcy) shall report thereon without delay to the Korea Communications Commission (including reports through information network).

Article 27 (Cancellation of Registration and Order for Closedown of Business)

(1) The Korea Communications Commission may, when a specific communications business operator falls under any of the following subparagraphs, cancel his registration wholly or partially, or suspend his business wholly or partially by specifying the period of not more than one year: Provided, That when he falls under subparagraph 1, the Korea Communications Commission shall cancel whole or part of his registration: (Newly Inserted by Act nº 5385, Aug. 28, 1997; Act nº 5564, Sep. 17, 1998; Act nº 5835, Feb. 8, 1999; Act nº 5986, May 24, 1999; Act nº 6230, Jan. 28, 2000; Act nº 6360, Jan. 16, 2001, Act nº 7916, Mar. 24, 2006; Act nº 8198, Jan. 3, 2007; Act nº. 8425, May 11, 2007; Act nº 8867, Feb. 29, 2008)

1. Where he makes a registration by deceit and other illegal means;

2. Where he fails to implement the conditions under Article 21 (2);

3. Where he fails to commence business within one year from the date on which a registration was made under Article 21 (4), or in violation of the latter part of Article 26(1) continually suspends business operation for not less than one year;

4. Where he fails to comply with an order under Article 52 (1) or an order for correction Article 92 (1) without any justifiable reasons;

(2) The Minister of Information and Communication may, when a value added communications business operator falls under any of the following subparagraphs, issue an order to him for a closedown of the whole or part of business (in case of a special type of value-added communications business operator, for a cancellation of the whole or part of business) or for a suspension of the whole or part of business by specifying a period of not more than one year: Provided, That when he falls under subparagraph 1,, the said Minister shall issue an order to him for a closedown of whole or part of business: (Amended by Act nº 10656, May 19, 2011)

1. Where he makes a report or registration by deceit and other illegal means;

2. Where he fails to implement the conditions under Article 22(3);

3. Where he fails to commence the business within one year from the reporting date or registration date under Article 22(5), or in violation of the latter part of Article 26(1) suspend the business operation for not less than one year;

4. Where he fails to comply with an order under Article 52 (1) or a correction order under Article 92 (1) without any justifiable reasons;

5. Where he fails to comply with an order to take corrective measures under Article 64(4) of the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc. without any justifiable reasons;

6. Where he who has been punished by a fine for negligence pursuant to Article 142(1) and Article 142(2)3 of the Copyright Act more than 3 times is subject to a fine for negligence again and such an order is requested by the Minister of Culture, Sports and Tourism after the Korea Copyright Commission’s deliberation pursuant to Article 112 of the same Act.

(3) Criteria and procedures for dispositions taken under paragraph (1) or (2) and other necessary matters shall be determined by the Enforcement Decree of the Act.

CHAPTER III.- TELECOMMUNICATIONS SERVICE

Article 28 (Report, etc. of Standardized Terms and Conditions)

(1) A key communications business operator shall set forth the fees and other terms for use by service with respect to the telecommunications service which he intends to provide (hereinafter referred to as the “standardized terms and conditions”), and report thereon (including a modified report, hereinafter refer to the same) to the Korea Communications Commission.

(2) Notwithstanding paragraph (1), in a case of a key communications service of key communications business operator whose size of business and market share correspond to the standards as determined by the Enforcement Decree, it shall obtain an authorization of the Korea Communications Commission (including a modified authorization, hereinafter refer to the same), provided that, any decrease in the service-specific charges included the approved standard terms and conditions of usage shall be reported to the Korea Communications Commission.

(3) In regard to the main body of paragraph (2), the Korea Communications Commission shall authorize the standardized terms and conditions, if it falls under the criteria of every following subparagraph:

1. Fees for telecommunications service shall be reasonably calculated considering but not limited to costs of supply, profits, classification of costs/ profits by labor, cost savings achieved by methods of provision of labor, and effects on fair competitive environments;

2. Matters concerning the responsibility of key communications business operators and relevant users, cost-sharing methods concerning the installation work of telecommunications facilities and other works shall not be unreasonably disadvantageous to users.

3. Forms of use of telecommunication line facilities by other telecommunications business operators or users shall not be unduly restricted;

4. Undue discriminatory treatments shall not be made to specific persons; and

5. Matters on securing the important communications under Article 85 shall take into consideration matters such as achieving efficient performance of State’s function.

(4) A person intending to acquire the approval under paragraph (1) and (2) or file a report with respect to the telecommunications services shall submit the supporting data for calculation of fee (including subscription fee, basic fee, usage fee, value-added service fee, and actual expense). In case of business change, a table comparing the old (before change) and new (after change) supporting data should be submitted to the Korea Communications Commission for comparison.

(5) Details necessary and not otherwise specified in paragraphs (1) through (4) in regard to the scope of and procedures of reporting and authorization shall be specified under the Enforcement Decree of the Act.

Article 29 (Reduction or Exemption of Fees)

A key communications business operator may reduce or exempt the fees for telecommunications service under the conditions prescribed by the Enforcement Decree, such as national security guarantee, disaster relief, social welfare and public interest.

Article 30 (Restriction on Use by Others)

No person shall intermediate other’s communications or provide for other’s communications by making use of telecommunications services provided by a telecommunications business operator: Provided, That the same shall not apply to the case falling under any of the following subparagraphs:

1. Where it is needed to ensure the prevention and rescue from disaster, traffic and communication, and the supply of electricity, and to maintain order in a national emergency situation;

2. Where telecommunications services are incidentally rendered to clients while running a business other than the telecommunications business;

3. Where it is allowed to use on a trial basis for the purpose of developing and marketing telecommunications facilities, such as terminal devices, etc. which enable to use the telecommunications services;

4. Where any user permits any third party to use to the extent that the latter does not use repeatedly; and

5. Where it is necessary for the public interests or where the business run by any telecommunications business operator is not impeded, which is prescribed by the Enforcement Decree.

Article 31 (Use of Transmission or Line Equipment, etc.)

(1) The composite cable TV business operator, transmission network business operator, or relay cable broadcasting business operator under the Broadcasting Act may provide the transmission or line equipment or the cable broadcasting equipment possessed under the methods prescribed by the Enforcement Decree to the key communications business operators.

(2) The composite cable TV business operator, transmission network business operator, or relay cable broadcasting business operator under the Broadcasting Act shall, when he intends to provide value-added communications services by making use of the transmission or line equipments or cable broadcasting equipments, make a report thereon to the Korea Communications Commission pursuant to Article 22 (1).

(3) The provisions of Articles 35 through 37 and 37 through 55 shall be applicable mutatis mutandis to the transmission or line equipment or cable broadcasting facilities under paragraph (1).

(4) The provisions of Article 28 (2) through (7) of the Framework Act on Telecommunications shall be applicable mutatis mutandis to the offer of services under paragraph (2).

Article 32 (Protection of Users)

(1) A telecommunications business operator shall take a prompt measure on the reasonable opinions or dissatisfactions raised by the users with respect to the telecommunications service. In this case, if it is difficult to take a prompt measure, he shall notify the users of the reasons thereof and the schedule for measures.

(2) Compensations for the damages incurred by the occurrence of reasons causing the opinions or dissatisfactions under paragraph (1) and by the delay of relevant measures shall be made pursuant to Article 33.

(3) A telecommunications business operator providing key communications services shall subscribe a guarantee insurance with the person designated by the Korea Communications Commission as beneficiary in an amount determined in accordance with the criteria specified under the Enforcement Decree of the Act and not exceeding the aggregate prepaid phone service charges to be received prior to providing prepaid phone services to be able to compensate losses to users arising from not being able to provide services after receiving service charges in advance. Provided, that the foregoing requirement may be waived in the case specified under the Enforcement Decree of the Act where such telecommunications business operator’s financial capacity and services charges are taken in consideration

(4) The person designated as beneficiary under paragraph (3) shall distribute insurance proceeds received under the guarantee insurance under paragraph (3) to users who have not received services after paying services charges in advance.

(5) Details necessary in regard to the subscription, renewal and distribution of insurance proceeds under paragraph (3) and (4) shall be specified in the Enforcement Decree of the Act.

Article 32-2 (Notice of Excess of Maximum Limit of Fees)

(1) A telecommunications business operator utilizing frequencies assigned under the Radio Waves Act shall notify the users of any of the following facts when it occurs:

1. When a user exceeds the maximum limit of telecommunications service fees initially committed by the user;

2. When any fees incurred from using international telecommunications services such as international call are charged to a user.

(2) Any matters necessary for users subject to notice or method of notice under paragraph (1) shall be determined and publicly announced by the Korea Communications Commission.

(Article amended by Act nº 10656, May 19, 2011)

Article 33 (Compensation for Damages)

A telecommunications business operator shall make compensations when he inflicts any damages on the users in the course of providing telecommunications services: Provided, That if such damages are the results of force majeure, or of intent or negligence of the users, the relevant liability for compensations shall be reduced or exempted.

CHAPTER IV.- PROMOTION OF COMPETITION AMONG THE TELECOMMUNICATIONS BUSINESS

Article 34 (Promotion of Competition)

(1) The Korea Communications Commission shall exert efforts to construct an efficient competition system and to promote fair competitive environments, in the telecommunications services.

(2) The Korea Communications Commission shall conduct annual evaluation of competition system with respect to key communications business in order to construct an efficient competition system and to promote fair competition in the telecommunication services industry pursuant to paragraph (1)above.

(3) The specific evaluation standards, procedure and method for evaluating competition system under paragraph (2) above shall be prescribed by the Enforcement Decree.

Article 35 (Provision of Facilities, etc.)

(1) A key communications business operator or an institution constructing, operating and managing road, railroad, subway, water supply/sewage, electric poles, cables, telecommunications line facilities (“facility management institution”) may, upon receipt of a request for the provision of conduit line, common duct, electric poles, cables, operation sites and other facilities (including telecommunication facilities, hereinafter the same) or facilities (“facilities, etc.”) from other key communications business operator, provide the facilities, etc. by concluding an agreement with him.

(2) A key communications business operator falling under any of the following subparagraphs shall, upon receipt of a request under paragraph (1), provide the facilities, etc. by concluding an agreement, notwithstanding the provisions of paragraph (1), provided that the foregoing is not applicable in case there is a usage plan, etc. of the facility management institution:

1. A key communications business operator who possesses the equipments which are indispensable for other telecommunications business operators in providing the telecommunications services; and

2. Each of the following facility management institutions owning conduit line, common duct, electric pole, cable and other facilities, etc.

A. the Korea Expressway Corporation organized under the Korea Highway Corporation Act

B. the Korea Water Resources Corporation organized under the Korea Water Resources Corporation Act

C. the Korea Electric Power Corporation organized under the Korea Electric Power Corporation Act

D. the Korea Rail Network Authority organized under the Korea Rail Network Authority Act

E. local public enterprises under Local Public Enterprise Act

F. municipalities under Local Autonomy Act

G. the Regional Construction Management Administration under the Road Act

3. A key communications business operator whose business scale and market shares, etc. of key communications services are equivalent to the criteria as determined by the Enforcement Decree.

(3) The Korean Communications Commission shall set forth and publicly notify the scope of facilities, etc., the conditions, procedures and methods for the provision of facilities, and the standards for calculation of prices under paragraphs (1) and (2). In this case, the scope of facilities, etc. to be provided under paragraph (2) shall be determined in view of the demand for facilities, etc. by the key communications business operators and facility management institution falling under each subparagraph of the same paragraph.

(4) A telecommunications business operator in receipt of provisions of the facilities, etc. may install the apparatus enhancing the efficiency of the relevant facilities, within the limit necessary for the provision of the licensed telecommunications services.

(5) For efficient use and management of facilities, etc., the Korea Communications Commission may request data on facilities, etc., from telecommunications business operators and facility management institutions in a manner specified under the Enforcement Decree of the Act. In this case, the pertinent telecommunications business operator or facility management institution shall honor such demand unless there are reasonable grounds for not doing so.

(6) For provision of facilities, etc. under paragraphs (1) and (2), the Korea Communications Commission may appoint an expert institution.

(7) Details necessary for appointment and operation guidelines for expert institutions under paragraph (6) shall be determined and announced by the Korea Communications Commission.

Article 36 (Joint Utilization of Subscriber’s Lines)

(1) A key communications business operator shall, in case where other telecommunications business operators as determined and publicly noticed by the Korea Communications Commission have made a request for a joint utilization with respect to the lines installed in the section from the exchange facilities directly connected with the users to the users (hereafter in this Article, referred to as the “subscriber’s lines”), allow it.

(2) The Korea Communications Commission shall set forth and publicly notify the scope of joint utilization of the subscriber’s lines under paragraph (1), its conditions, procedures and methods, and the standards for calculation of prices.

Article 37 (Joint Utilization of Radio Communications Facilities)

(1) A key communications business operator may, upon receipt of a request for the joint utilization of radio communications facilities (hereinafter referred to as the “joint utilization”) from other key communications business operators, allow it by concluding an agreement. In this case, the prices for the joint utilization among the key communications business operators as set forth and publicly notified by Korea Communications Commission shall be computed and settled accounts by a fair and reasonable means.

(2) The key communications business operators as determined and publicly notified by the Korea Communications Commission shall, upon receipt of a request for the joint utilization from other key communications business operators as determined and publicly notified by the Korea Communications Commission, allow it by concluding an agreement, notwithstanding the provisions of paragraph (1), in order to enhance the efficiency of the telecommunications business and to protect the users.

(3) The Korea Communications Commission shall set forth and publicly notify the standard for computing the prices for joint utilization under the latter part of paragraph (1) and its procedures and payment methods, etc., and the scope of joint utilization under paragraph (2), its conditions, procedures and methods, and the computation of prices, etc.

Article 38 (Wholesale Provision of Telecommunication Services)

(1) Upon request from other telecommunication business operator, a key communications business operator may enter into an agreement to allow such telecommunication business operator to resell the telecommunication services it provides to users (“resale”) by providing such services to such other telecommunication business operator or permitting part or all of the telecommunication facilities necessary for such provision of telecommunication services (“wholesale provision”).

(2) To encourage competition in the telecommunication industry, the Korea Communications Commission may, upon request from a telecommunication business operator, designate and announce telecommunication s services (“designated wholesale services”) of a key communications business provider which would need to enter into an agreement for wholesale provision (“designated wholesale provider”). In this case, designated wholesale services of the designated wholesale provider shall be selected from telecommunication services of key communications business providers satisfying the criteria specified in the Enforcement Decree of the Act which would take into consideration business size and market share.

(3) After evaluating the competition status of the communications market each year, if the Korea Communications Commission determines that the competition in the telecommunications industry has increased to the degree where the sufficient wholesale of telecommunications services have been provided or the set criteria are not met, it may withdraw its designation of designated wholesale services of the designated wholesale provider.

(4) The Korea Communications Commission shall determine and announce the terms and conditions of the wholesale provision when the designated wholesale provider enters into an agreement about the designated wholesale services. In this case, the consideration shall be calculated on the basis of subtracting avoidable costs (costs that the key communications business operator can avoid when not providing services directly to users) from retail prices of the designated wholesale services.

(5) Upon request for wholesale provision from other telecommunications business operator, a key communications business operator shall enter into an agreement within 90 days unless there are special reasons and shall report such agreement to the Korea Communications Commission in a manner specified in the Enforcement Decree of the Act within 30 days from the execution of such agreement. The same applies in the case of a change or abolition of the agreement.

(6) An agreement under paragraph (5) shall satisfy the criteria announced by the Korea Communications Commission under paragraph (4).

Article 39 (Interconnection)

(1) A telecommunications business operator may allow the interconnection by concluding an agreement, upon a request from other telecommunications business operators for an interconnection of telecommunications facilities.

(2) The Korea Communications Commission shall set forth and publicly notify the scope of interconnections of telecommunications facilities, the conditions, procedures and methods, and the standards for calculation of prices under paragraph (1).

(3) Notwithstanding the provisions of paragraphs (1) and (2), the key communication business operators falling under any of the following subparagraphs shall allow the interconnection by concluding an agreement, upon receipt of a request under paragraph (1):

1. A key communications business operator who possesses such facilities as are indispensable for a provision of telecommunications services by other telecommunications business operators; and

2. A key communications business operator whose business size of key communications services and the ratio of market shares are compatible with the standards as determined by the Enforcement Decree.

Article 40 (Prices of Interconnection)

(1) Prices for using the interconnection shall be calculated by a fair and proper means and deducted from each other’s accounts. The detailed standards for such calculation, their procedures and methods shall be governed by the standards of Article 39 (2).

(2) A telecommunications business operator may deduct the prices for interconnection from each other’s accounts under the conditions as prescribed by the standards under Article 39 (2), if he suffers any disadvantages due to the causes of no liability on his part, in the method of interconnection, the quality of connected conversations, or the provision of information required for interconnection, etc.

Article 41 (Joint Use, etc. of Telecommunications Facilities)

(1) A key communications business operator may allow an access to or a joint use of the telecommunications equipment or facilities by concluding an agreement, upon receipt of a request from other telecommunications business operators for an access to or a joint use of the telecommunications equipment or facilities such as pipes, cables, poles, or stations of the relevant key communications business operator, for the establishment or operation of facilities required for interconnection of telecommunications facilities.

(2) The Korean Communications Commission shall set forth, and make a public notice of, the scope, conditions, procedures and methods for an access to or a joint use of telecommunications equipment or facilities, and the standards for computation of prices under paragraph (1).

(3) Notwithstanding the provisions of paragraph (1), a key communications business operator falling under any of the following subparagraphs shall allow an access to or a joint use of the telecommunications equipment or facilities under paragraph (1) by concluding an agreement, upon a receipt of request under paragraph (1):

1. A key communications business operator who possesses such facilities as are indispensable for a provision of telecommunications services by other telecommunications business operators; and

2. A key communications business operator whose business size of key communications services and the ratio of market shares are compatible with the standards as determined by the Enforcement Decree.

Article 42 (Provision of Information)

(1) A key communications business operator may provide requested information by concluding an agreement, upon a receipt of request from other telecommunications business operators for a provision of information related to technological information or the user’s personal matters which are required for a provision or wholesale provision of facilities, etc., interconnection, or joint use, etc. and imposition and collection of fees and a guide to the telecommunications number.

(2) The Korean Communications Commission shall set forth, and make a public notice of, the scope, conditions, procedures and methods for a provision of information, and the standards for computation of prices under paragraph (1).

(3) Notwithstanding the provisions of paragraph (1), a key communications business operator falling under any of the following subparagraphs shall provide the requested information by concluding an agreement, upon a receipt of request under paragraph (1):

1. A key communications business operator who possesses such facilities as are indispensable for a provision of telecommunications services by other telecommunications business operators; and

2. A key communications business operator whose business size of key communications services and the ratio of market shares are compatible with the standards as determined by the Enforcement Decree.

(4) A key communications business operator under paragraph (3) shall set forth the technical standards required for a use by other telecommunications business operators or users by means of a connection of a monitor and other telecommunications equipment on the relevant telecommunications facilities, the standards for use and provision, and other standards required for a creation of fair competitive environments, and make a public notice thereof by obtaining approval from the Korea Communications Commission.

Article 43 (Prohibition of Information Diversion)

(1) A telecommunications business operator shall not divulge any information concerning an individual user which has been obtained due to a provision of his own service, a provision of facilities, etc., wholesale provision, an interconnection or joint use, etc. Provided, That the same shall not apply, when there exists the consent of the principal or the case under a lawful procedure pursuant to the provisions of the Acts.

(2) A telecommunications business operator shall use the technological information or personal data of users obtained under Article 42(1) and (3) within the context of purposes thereof, and may not use it unjustly, or provide it to the third parties.

Article 44 (Report, etc. of Agreement on Interconnection, etc.)

(1) A key communications business operator and facility management institution shall conclude an agreement under Article 35 (1) and (2), the earlier part of 37 (1), 39 (1), 41 (1) or 42 (1) within ninety days unless there exist any special reasons and report it to the Korea Communications Commission in a manner specified in the Enforcement Decree of the Act within 30 days from the execution of such agreement, upon receipt of a request from other telecommunications business operators for a provision, a joint utilization, an interconnection or a joint use, etc. of telecommunications facilities, or a provision of information. The same applies in the case of a change or abolition of the agreement.

(2) Notwithstanding the provision of paragraph (1), in case of an agreement in which a key communications business operator under the latter part of Article 37 (1) and (2), Articles 39 (3), 41 (3), and 42 (3) is a party concerned, shall enter into an agreement within 90 days upon receipt of the request, unless there is a special reason, and the key communications business operator receiving the request shall apply for authorization to the Korea Communications Commission in a manner specified in the Enforcement Decree of the Act within 30 days from the execution of the Agreement and reveal the contents of the agreement within 30 days from the authorization date. The same applies in the case of a change or abolition of the agreement

(3) The agreement under paragraphs (1) and (2) shall meet the standards which are publicly notified by the Korea Communications Commission under Articles 35 (3), 37 (3), 39 (2), 41 (2)or 42 (2).

(4) The Korea Communications Commission may, if any application for authorization referred to in paragraph (2) needs supplemented, order such application for authorization supplemented for a fixed period.

(5) The agreement under Articles 41 (1) and 42 (1) may be concluded by an inclusion in the agreement under Article 39 (1).

Article 45 (Ruling of the Korea Communications Commission)

(1) A telecommunications business operator or user may request to the Korea Communications Commission for an arbitration if they fail to agree on are not able to agree on any of the following:

1. indemnification under Article 33

2. execution of an agreement within a 90-day period regarding provision of facilities, etc. interconnection, joint use or provision of information, etc.

3. performance or indemnification under an agreement regarding provision of facilities, etc. interconnection, joint use or provision of information, etc

4. other disputes concerning telecommunications business or matters specified as subject to the Korea Communications Commission’s ruling under other bodies of law

(2) Upon receipt of the request for an arbitration under paragraph (1), the Korea Communications Commission shall notify the parties of that fact and set a timeline for providing them with a chance to make their cases, provided that the foregoing is not applicable if a relevant party does not submit to the procedures without any justifiable reason.

(3) The Korea Communications Commission shall make a ruling within 90 days from the request for arbitration provided that such period may be extended by one additional 90-days upon the resolution of the Korea Communications Commission if it is not possible to make a ruling within the original 90-day period for any unavoidable reason.

(4) If any part to the arbitration files a suit during the arbitration proceeding, the Korea Communications Commission shall suspend the arbitration proceeding and notify the other party of that fact. The same applies if it is found out that a lawsuit was filed prior to the receipt of request for arbitration.

(5) When it has made a ruling for the request made under paragraph (1), the Korea Communications Commission shall provide such written ruling to the parties without delay.

(6) Within 60 days from the date on which the originals of written ruling of the Korea Communications Commission were sent to the parties, if no lawsuit regarding the dispute between the parties to the arbitration has been filed or such lawsuit has been withdrawn or the parties clearly indicate their acceptance of the ruling to the Korea Communications Commission, an agreement equivalent to the contents of the ruling shall be deemed to have been made.

Article 46 (Solicitation for Outside Arbitration)

If the Korea Communications Commission, upon receiving request for arbitration under Article 45(1), deems that it is inappropriate to conduct arbitration or is necessary for other reasons, it may form a separate commission for each dispute and solicit for outside arbitration.

Article 47 (Demand for Attendance, Hearing, etc.)

When necessary for proceeding with the arbitration case, the Korea Communications Commission may on its own motion or upon request from a party take any of the following actions:

1. demand for attendance of a party or witness and hold a hearing

2. demand for appraisal to an appraiser

3. demand for submission of documents or objects relevant for the dispute and provisional seizure of the documents or objects so submitted.

Article 48 (Management Plan for Telecommunications Number)

(1) The Korea Communications Commission shall formulate and enforce the management plan for telecommunications number, in order to make an efficient provision of telecommunications service, and the promotion of user’s convenience and of the environments of fair competition among telecommunications business operators.

(2) The Korea Communications Commission shall, when he has formulated the plans under paragraph (1), make a public notice thereof. This shall also apply to any alterations in the established plan.

(3) A telecommunications business operator shall observe the matters publicly noticed under paragraph (2).

Article 49 (Accounting Adjustment)

(1) A key communications business operator shall adjust the accounting, prepare a business report for the preceding year by the end of within 3 months after the end of each fiscal year, and submit it to the Korea Communications Commission, under the conditions as determined by the Enforcement Decree, and keep the related books and authoritative documents.

(2) The Korea Communications Commission shall, when it intends to determine the matters of accounting adjustments under paragraph (1), go in advance through a consultation with the Minister of Strategy and Finance.

(3) The Korea Communications Commission may verify contents of any business report submitted by any key communications business operator in accordance with paragraph (1).

(4) The Korea Communications Commission may, if it is necessary to conduct the verification referred to in paragraph (3), order the relevant key communications business operator to submit related material or launch inspection necessary to ascertain the facts.

(5) The Korea Communications Commission shall, when it intends to launch inspection in accordance with paragraph (4), notify the relevant key communications business operator of the plans of such inspection including inspection period, reasons, and contents of the inspection within seven (7) days prior to the scheduled date of inspection.

(6) A person verifying the contents pursuant to paragraph (4) shall present the proof of the authorization therefor and give documents indicating his name, stay period and purpose of entrance to related party at the time of his first entrance.

Article 50 (Prohibited Act)

(1) A telecommunications business operator shall not commit any of the following acts (hereinafter referred to as “prohibited act”) which undermines or is feared to undermine fair competition or users’ interests, or have other telecommunications business operators or the third parties commit such act:

1. Act of imposing unfair or unreasonable condition or restriction in a provision, a joint utilization, a joint using, an interconnection, a joint use or a wholesale provision of facilities, etc. or a provision of information, etc.;

2. Act of unfairly refusing a conclusion of agreement, or act of non-performance of the concluded agreement without any justifiable reasons in a provision, a joint utilization, a joint using, an interconnection, a joint use or a wholesale provision of facilities, etc. or a provision of information, etc.;

3. Act of unfairly diverting the information of other telecommunications business operators to his own business activities, which have been known to him in the course of a provision, a joint utilization, a joint using, an interconnection, a joint use or a wholesale provision of facilities, etc., or a provision of information, etc.;

4. Act of computing the fees, etc. for a use of telecommunications services, or the prices for a provision, a joint utilization, a joint using, an interconnection, a joint use or a wholesale provision of facilities, etc. or a provision of information, by unfairly itemizing the expenses or revenues;

5. Act of rendering the telecommunications services in a manner different from the standardized terms and conditions (the standardized terms and conditions refers to only those of which was reported or approved as pursuant to the Article 28 (1) and (2)) or act of rendering the telecommunications services in a manner which significantly undermines the profits of users;

6. Act of setting and maintaining the compensation for a provision, a joint utilization, a joint using, an interconnection, a joint use or a wholesale provision of facilities, etc. or a provision of information, unreasonably high compared to its supply costs

7. Act of refusing or restricting fair allocation of income in a transaction where telecommunications services using the radio waves assigned under the Act on Radio Waves are to be used to provide digital contents

(2) When any person acting on behalf of any telecommunications business operator under a contract therewith in executing contracts between such telecommunications business operator and its users (including making any amendment to such contracts) commits any act falling under paragraph (1)5, his act shall be deemed the act committed by such telecommunications business operator and only the provisions of Articles 52 and 53 shall apply to such act: Provided, That the same shall not apply to a case where the relevant telecommunications business operator has paid reasonable attention to the prevention of such act.

(3) Necessary matters concerning categories of and standards for the prohibited act referred to in paragraph (1) shall be prescribed by the Enforcement Decree.

Article 51 (Investigation of Fact)

(1) In the event the Korea Communications Commission believes that activities in violation of Article 50(1) have been committed, it may order the relevant public official belonging to the Korea Communications Commission to conduct investigation thereof.

(2) The Korea Communications Commission may order public officials belonging to the Korea Communications Commission to enter into the offices or workplaces of the telecommunications business operators or the workplaces of the persons entrusted with handling of the business of telecommunications business operators (limited, throughout this Article, to telecommunications business operators entrusted with work related to Article 50) and inspect books, documents and other data and objects.

(3) In the event any investigation is to be conducted pursuant to paragraph (1), the Korea Communications Commission shall notify the relevant telecommunications business operator at least seven (7) days prior to the expected date of investigation with information on the duration, purpose and content of the investigation. Provided, this provision may not apply in the event of emergency or if there is risk that the evidence will be destroyed.

(4) A person who investigates by visiting the offices or workplaces of the telecommunications business operators, or the workplaces of the persons handling, under an entrustment, the business of telecommunications business operators, under paragraph (2) shall carry a certificate indicating the authority, and present it to the persons concerned. He also should be accompanied by the person of the corresponding offices or workplaces.

(5) A public official who investigates pursuant to paragraph (2) may order telecommunications business operators or persons entrusted with handling of the business of telecommunications business operators to submit any necessary information or object. In the event there is a possibility of abandonment, concealment, or replacement of the information or object so submitted, the public official may temporarily take them into custody.

(6) The Korea Communications Commission shall immediately return the information or object under its custody if it falls under any one of the following:

1. It is deemed, after an examination of the information or object under the custody, that it has no relevance to the current investigation.

2. The purpose of investigation is fully accomplished so that keeping the information or object under its custody is no longer necessary.

Article 52 (Measures on Prohibited Acts)

(1) The Korea Communications Commission may order any telecommunication business operator to take the measures falling under each of the following subparagraphs when it is recognized that any act in violation of paragraph 1 of Article 50 has been committed:

1. Separation of the supply system of telecommunications service;

2. Change of internal accounting regulations, etc. concerning telecommunications service;

3. Disclosure of information concerning telecommunications service;

4. Conclusion, performance or change of contents of the agreement between the telecommunications business operators;

5. Change of the standardized terms and conditions and the articles of incorporation of the telecommunications business operators;

6. Suspension of prohibited acts;

7. Public announcement of a fact of receiving a correction order due to committing the prohibited acts;

8. Measures necessary for restoring the violated matters due to the prohibited acts to their original status, such as the removal of telecommunications facilities which have caused the prohibited acts;

9. Improvement of business conduct procedures regarding telecommunications service;

10 Prohibition of soliciting new users (for a period not exceeding 3 months and limited to cases where the same violation has occurred for 3 times or more despite sanctions under subparagraphs 1 through 9 or where such sanctions are deemed insufficient to prevent harm to users); and

11. Such other matters prescribed by the Enforcement Decree as may be necessary for the measures referred to in subparagraphs 1 through 10.

(2) The telecommunications business operators shall execute any order issued by the Korea Communications Commission under paragraph (1) within the period specified by the Enforcement Decree: Provided, That the Korea Communications Commission may extend the relevant period only once, if it is deemed that the telecommunications business operators are unable to carry out the order within the specified period due to natural disasters and other unavoidable causes.

(3) The Korea Communications Commission shall, before ordering the measures under paragraph (1), notify the parties concerned of the content of relevant measures, and provide them with an opportunity to make a statement within a specified period, and may hear, where deemed necessary, demand for attendance of an interest party or witness, hearing or appraiser by an appraiser.: Provided, That this shall not apply when the parties concerned fail to respond without any justifiable reasons.

(4) In the event five (5) years have passed from the date on which any acts committed in violation of paragraph 1 of Article 50 have been terminated, the Korea Communications Commission shall not order any measures pursuant to paragraph 1 or impose a penalty surcharge pursuant to Article 53. Provided, this provision shall not apply if any measure or imposition of penalty surcharge is cancelled by court order and a new measure is to be taken pursuant to that court order.

Article 53 (Imposition, etc. of Penalty Surcharge on Prohibited Acts)

(1) The Korea Communications Commission may, in case where there exists any act in violation of paragraph 1 of Article 50, impose a penalty surcharge not exceeding 3/100 of the turnover as prescribed by the Enforcement Decree on the relevant telecommunications business operator. If the telecommunications business operator refuses to submit the data used for calculation of the amount of turnover or submits erroneous data, an estimate of the amount can be assessed based on the financial statement of those who provide similar services in the same industry (accounting documents, number of subscribers, usage fee and business operation status): Provided, That where there is no turnover or it is difficult to calculate the turnover as prescribed by the Enforcement Decree, it may impose the penalty surcharge not exceeding one billion won.

(2) The Korea Communications Commission may impose on a key communications business operator that submits a business report under Article 49 a find up to 3% of its revenue as determined in a manner specified under the Enforcement Decree of the Act if it commits any of the following:

1. failure to submit a business report under Article 49 or to abide by an order to submit relevant information

2. omission of a material item or inclusion of a false statement in a business report under Article 49

3. failure to adjust the accounting or keep the related books and authoritative documents in violation of Article 49(1)

(3) The Korea Communications Commission shall, in the event of imposing a penalty surcharge under paragraph (1) or (2), take each of the following into consideration.

1. details of violation and the extent thereof

2. duration and frequency of violation

3. amount of profit obtained in connection with the violation

4. the amount of turnover obtained as a result of the prohibited activities or adjustment of the accounting of the telecommunications business operator.

(4) A penalty surcharge under paragraph (1) or (2) shall be calculated taking paragraph (3) into consideration, provided specific calculation standard and procedure shall be set forth by the Enforcement Decree.

(5) The Korea Communications Commission shall, where a person liable to pay a penalty surcharge under paragraph (1) or (2) fails to do so by the payment deadline, collect an additional due equivalent to 6/100 per year, with respect to the penalty surcharge in arrears, from the day following the expiry of such payment deadline.

(6) The Korea Communications Commission shall, where a person liable to pay a penalty surcharge under paragraph (1) or (2) fails to do so by the payment deadline, demand him to pay it with fixing a period, and if he fails to pay the penalty surcharge and an additional due under paragraph (5) within the fixed period, collect them according to the example of a disposition taken to collect the national taxes in arrears.

(7) In the event the penalty surcharge imposed under paragraph (1) or (2) is to be returned pursuant to the court order, an additional due equivalent to 6/100 per year with respect to the penalty surcharge in arrears(accrued from the day of payment to the day of payment) shall be paid.

Article 54 (Relations with Other Acts)

In case where a measure is taken under Article 52 or a penalty surcharge is imposed under Article 53 against the acts in violation of paragraph (1) of Article 50, a corrective measure or an imposition of penalty surcharge under the Monopoly Regulation and Fair Trade Act shall not be made under the same grounds against the same acts of the relevant business operator.

Article 55 (Compensation for Damages)

In case where a correction measure has been taken under Article 52 (1), a person who is damaged by the prohibited act may claim for compensation against the telecommunications business operator who conducted the prohibited act, and the relevant telecommunications business operator may not shirk liability unless he can prove that there was no malicious intention or negligence.

Article 56 (Quality Improvement of Telecommunications Services)

(1) A telecommunications business operator shall endeavor to make a quality improvement of the telecommunications services he provides.

(2) The Korea Communications Commission shall devise the required policy measures, such as an evaluation of quality of the telecommunications services, in order to improve a quality of telecommunications services and to enhance the conveniences of users.

(3) The Korea Communications Commission may order the telecommunications business operator to furnish data necessary for an evaluation of quality of the telecommunications services, etc. under paragraph (2).

Article 57 (Prior Selection Systems)

(1) The Korea Communications Commission shall perform the systems in which the users may select in advance the telecommunications business operator from whom they desire to receive the telecommunications service (hereinafter referred to as the “prior selection systems”). In this case, the telecommunications service shall refer to the telecommunications service as determined by the Enforcement Decree from among the same telecommunications service provided by the plural number of telecommunications business operators.

(2) The telecommunications business operator shall not force the users to select in advance a specified telecommunications business operator, or commit the acts to recommend or induce by unlawful means.

(3) The Korea Communications Commission may, for the purpose of performing the prior selection systems efficiently and neutrally, designate the specialized institutes performing the registration or alteration affairs of the prior selection (hereinafter referred to as the “prior selection registration center”).

(4) The Korea Communications Commission shall determine and publicly notify the matters necessary for performing the prior selection systems and for the designation of the prior selection registration center and the method of dealing with its affairs, etc.

Article 58 (Mobility of Telecommunication Numbers)

(1) The Korea Communications Commission may, in order that the users are able to maintain their previous telecommunications numbers despite of the changes of the telecommunications business operators, etc., devise and perform the plans for mobility of telecommunications numbers (hereafter in this Article, referred to as the “plans for mobility of numbers”).

(2) The plans for mobility of numbers shall contain the contents falling under any of the following subparagraphs:

1. Kinds of services subject to the mobility of telecommunications numbers;

2. Time for introduction by service subject to the mobility of telecommunications numbers; and

3. Matters on sharing the expenses required for the performance of mobility of telecommunications numbers by telecommunications business operator.

(3) The Korea Communications Commission may, in order to perform the plans for mobility of numbers, order the relevant telecommunications business operators to take the necessary measures.

(4) The Korea Communication Commission may designate an institution specializing in the work of registration and alteration of the mobility of numbers (hereinafter referred to as the “mobility of numbers management institution”) to efficiently and neutrally implement the mobility of numbers of the telecommunications.

(5) The Korea Communication Commission shall prescribe and publish necessary matters concerning the implementation of the mobility of numbers of the telecommunications, the designation of any mobility of numbers management institution and its work, etc.

Article 59 (Restrictions, etc. on Mutual Possession of Stocks)

(1) Where a key communications business operator falling under Article 39 (3) 1 or 2 (including the specially-related persons) possesses in excess of 5/100 of the gross number of voting stocks issued by the mutually different key communications business operators, shall not be allowed to exercise any voting rights with regard to the stocks in excess of the relevant ceiling.

(2) Provisions of paragraph (1) shall not apply to the relation of possessions between a key communications business operator falling under Article 39 (3) 1 or 2 and the key communications business operator established by the said key communications business operator by becoming the largest stockholder.

Article 60 (Provision of Directory Assistance Service)

(1) The telecommunications business operator shall provide an information service of guiding the general public to the telecommunications numbers of the users by means of voice, booklets or Internet, etc. (hereinafter referred to as the “directory assistance service”) by obtaining a consent of the users: Provided, That the same shall not apply to the minor business determined and publicly announced by the Korea Communications Commission by taking account of the numbers of the users and the turnovers, etc.

(2) If necessary for the protection of private personal information, the Korea Communications Commission may limit the provision of the directory assistance service.

(3) Matters necessary for a provision of the directory assistance service may be stipulated by the Enforcement Decree.

CHAPTER V.- TELECOMUNICATIONS FACILITIES

Section 1.- Commercial Telecommunication Facilities

Article 61 (Maintenance and Repair of Telecommunications Facilities)

For stable provision of its telecommunications services, a telecommunications business operator shall maintain and repair the telecommunications facilities it provides up to technical specifications specified under the Enforcement Decree of the Act for stable supply of telecommunications.

Article 62 (Report and Authorization of Telecommunications Facilities Installation)

(1) When a key communications business operator seeks to install or modify a significant telecommunications facilities, it shall report it to the Korea Communications Commission in a manner specified under the Enforcement Decree of the Act. Provided, that for the telecommunications facilities installed for the first time for new telecommunication technology, an authorization from the Korea Communications Commission shall be obtained in a manner specified in the Enforcement Decree of the Act.

(2) The scope of significant telecommunications facilities under paragraph (1) shall be determined and announced by the Korea Communications Commission.

Article 63 (Joint Installation of Telecommunications Facilities)

(1) A key communications business operator may agree with another key communications business operator to jointly install and use telecommunications facilities.

(2) When key communications business operators negotiate with each other under paragraph (1), the Korea Communications Commission may conduct a research on necessary information and provide it to them in a manner specified under the Enforcement Decree of the Act.

(3) For efficient research under paragraph (2), the Korea Communications Commission may engage an expert institution in the telecommunications area to conduct such research in a manner specified under the Enforcement Decree of the Act.

(4) The Korea Communications Commission may recommend joint installation of telecommunications facilities under paragraph (1) to key communications business operators in a manner specified under the Enforcement Decree in any of the following cases:

1. where no agreement is reached under paragraph (1) and request is made by one of the key communications business operators

2. where it is deemed necessary for the public good

(5) If a key communications business operator fails to reach an agreement on the use of land or buildings owned by the government, public agencies under the Act on the Management of Public Agencies (“public agencies” in this Article) or another key communications business operator when such use is necessary for joint installation of telecommunications facilities, it may request for help from the Korea Communications Commission on use of such land or building.

(6) Upon receiving the request for help under paragraph (5), the Korea Communications Commission may make a demand to the head of the government entities, municipalities, public agencies or the other key communications business operator for reaching an agreement with the use of relevant land or building with the key communications business operator making the request for help. in this case, the head of the government entities, municipalities, public agencies or the other key communications business operator shall make such agreement unless there is a justifiable reason.

Section 2.- PROPRIETARY TELECOMMUNICATIONS FACILITIES

Article 64 (Installation of Proprietary Telecommunications Facilities)

(1) A person seeking to install proprietary telecommunications facilities shall make a report to the Korea Communications Commission in a manner specified under the Enforcement Decree of the Act. The same applies when an important aspect of reporting items as specified under the Enforcement Decree is sought to be modified.

(2) Notwithstanding paragraph (1), in case of wireless proprietary telecommunications facilities and military telecommunications facilities and others where other bodies of law are applicable, such bodies of law shall be applicable.

(3) A person who has made a report on installation or modification of proprietary telecommunications facilities under paragraph (1) shall receive confirmation from the Korea Communications Commission in a manner specified under the Enforcement Decree of the Act when such installation or modification construction is complete and before commencement of its use.

(4) Notwithstanding paragraph (1), certain proprietary telecommunications facilities specified under the Enforcement Decree of the Act may be installed without filing a report.

Article 65 (Restriction on Non-Proprietary Use)

(1) A person who has installed proprietary telecommunications facilities may not use such facilities to interconnect other’s communication or operate it outside its installation purposes, provided that the foregoing is not applicable in cases where other bodies of law have special provisions of any of the following is applicable:

1. use by a person in law enforcement of disaster rescue industries for law enforcement or emergency rescue operation

2. use by a specially related person of the installer of proprietary telecommunications facilities as announced by the Korea Communications Commission

(2) A person who has installed proprietary telecommunications facilities may provide telecommunications facilities such as conduit line to a key communications business operator In a manner specified under the Enforcement Decree of the Act.

(3) Articles 35, 44 (excluding paragraph (5)) and 45 through 47 shall be applicable in case of provision of facilities under paragraph (2).

Article 66 (Securing Communication Lines in Case of Emergency)

(1) When a war, accident or natural disaster or other national emergency has happened or is likely to happen, the Korea Communications Commission may order a person who has installed proprietary telecommunications facilities to engage in telecommunications services or other important communications services or connect the telecommunications facilities to other telecommunications facilities. In this case, Articles 28 through 55 shall be applicable.

(2) When the Korea Communications Commission deems necessary for the purposes of paragraph (1), may order a key communications business operator to handle such task.

(3) The costs of performing the task or interconnecting facilities under paragraph (1) shall be borne by the government, provided that when proprietary telecommunications facilities are used for telecommunications services, the key communications business operator receiving such service shall bear its costs.

Article 67 (Order on the Person Installing Proprietary Telecommunications Facilities, Etc.)

(1) When a person who has installed proprietary telecommunications facilities fails to abide by the Act or order under this Act, the Korea Communications Commission may order a corrective measure to be carried out within a specific time frame.

(2) If a person who has installed proprietary telecommunications facilities falls under any of the following, the Korea Communications Commission may order a cessation of use for a period not exceeding one year:

1. failure to carry out the corrective order under paragraph (1)

2. use of proprietary telecommunications facilities without receiving confirmation in violation of Article 64(3)

3. interconnection of other’s communication or use of proprietary telecommunications facilities outside its installation purposes in violation of Article 65(1)

(3) When the Korea Communications Commission deems that proprietary telecommunications facilities are interfering with other’s telecommunications or likely to harm other’s telecommunications facilities, it may order the person who installed such facilities to stop using, modify, repair or take other corrective measures.

Section 3.- INTEGRATED MANAGEMENT OF TELECOMMUNICATIONS FACILITIES, ETC.

Article 68 (Installation of Common Duct or Conduit Line, etc.)

(1) A person installing or arranging any of the following (hereinafter referred to as the “facility installer”) shall solicit and reflect an opinion from a key communications business operator about installing a common duct or conduit line for telecommunications facilities, provided that the forgoing obligation does not apply when there is a special reason for not being able to honor the key communications business operator’s opinion.

1. road under Article 2(1)1 of the Road Act

2. railroad under Article 2(1) of the Railroad Enterprise Act

3. urban railroad under Article 3(1) of the Urban Railroad Act

4. industrial complex under Article 2(5) of the Industrial Sites and Development Act

5. free trade zone under Article 2(1) of the Act on Designation and Management of Free Trade Zone

6. airport area under Article 2(9) of the Aviation Act

7. port area under the Harbor Act

8. other facilities or land as specified under the Enforcement Decree of the Act

(2) An opinion set forth by key communications business operator about installation of common duct or conduit line under paragraph (1) shall satisfy the installation requirements for common duct specified under the Enforcement Decree of the Act.

(3) Articles 35, 44 (excluding paragraph (5)) and 45 through 47 shall be applicable in case of provision of common duct or conduit line installed under paragraph (1).

(4) When a facility installer is unable to reflect the opinion of key communications business operator under paragraph (1), it shall notify the key communications business operator of the reason for such inability within 30 days from the receipt of such opinion.

(5) When a facility installer does not reflect the opinion of key communications business under paragraph (1), the key communications business operator may ask for reconciliation from the Korea Communications Commission.

(6) When attempting reconciliation upon receipt of the reconciliation request under paragraph (5), the Korea Communications Commission shall consult with the head of relevant administrative organization in advance.

(7) Details necessary for reconciliation under paragraphs (5) and (6) shall be specified under the Enforcement Decree of the Act.

Article 69 (Installation of Telecommunication: Line Facilities for Internal Routing, etc.)

(1) A building under Article 2(1)2 of the Building Act shall install telecommunication line facilities for internal routing and set aside a certain area for connection with telecommunication grid facilities.

(2) Details on the scope of building, standards for installing telecommunication line facilities and the setting aside of a certain area for connection with telecommunication grid facilities shall be specified under the Enforcement Decree of the Act.

Article 70 (Integrated Management of Telecommunications Facilities, Etc.)

(1) For efficient management and operation of telecommunications facilities, the Korea Communications Commission may allow a key communications business operator designated in accordance with the criteria and procedures specified under the Enforcement Decree of the Act (hereinafter referred to as the “integrated telecommunications operator”) to manage telecommunications facilities installed under this Act or other bodies of law and the relevant land, building or fixtures (hereinafter referred to as the “telecommunications facilities, etc.”) on an integrated basis.

(2) When the Korea Communications Commission seeks to allow for integrated management of telecommunications facilities, etc. under paragraph (1), it shall establish a telecommunications facilities integrated management plan (hereinafter referred to as the “integrated management plan”), consult with the head of relevant administrative agencies, have it approved by the President after passing the cabinet review.

(3) An integrated management plan shall have the following:

1. subject, method and procedures of integration

2. management of telecommunications facilities, etc. for the post-integration period

3. other matters specified under the Enforcement Decree of the Act

(4) When it the Korea Communications Commission seeks to establish an integrated management plan, it shall consult with the installers of the telecommunications facilities, etc. to be integrated in advance.

Article 71 (Purchase of Telecommunications Facilities, Etc.)

(1) An integrated telecommunications operator may, when necessary for integrated management of telecommunications facilities, etc., request purchase of the relevant telecommunications, etc. In this case, the owners of the telecommunications facilities may not refuse such request without any justifiable reason.

(2) When purchase request is made by an integrated telecommunications operator under paragraph (1), telecommunications facilities, etc. directly or publicly owned by the government may be sold to the integrated telecommunications operator notwithstanding Article 27 of the State Properties Act or Article 19 of the Public Property and Commodity Management Act integrated telecommunications operator. In this case, details necessary for the calculation of sales price, sales procedures, payment of sales price, etc. shall be specified under the Enforcement Decree of the Act.

(3) Articles 67(1), 70, 71, 74, 75, 75-2, 76, 77 and 78(5) through (7) of the Act on the Acquisition of Land, etc. for Public works and the Compensation Therefor shall be applicable for the calculation of sales price, sales procedures, payment of sales price, etc. of the telecommunications facilities, other than those directly or publicly owned by the government, purchased by an integrated telecommunications operator.

Section 4.- Installation and Preservation of Telecommunications Facilities

Article 72 (Use of Land, etc.)

(1) A key communications business operator may, when necessary for the installation of line tracks, aerial lines and the appurtenant facilities to be available for telecommunications service (hereinafter referred to as the “line tracks, etc.”), make use of others’ land, or buildings and structures appurtenant thereto, and surface and bottom of the water (hereinafter referred to as the “land, etc.”). In this case, a key communications business operator shall make a consultation with owners or possessors of the relevant land, etc. in advance.

(2) Where a consultation under paragraph (1) is not or cannot be made, a key communications business operator may use the land, etc. owned by others, pursuant to the Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor.

Article 73 (Temporary Use of Land, etc.)

(1) A key communications business operator may, when necessary for the measurement of line tracks, etc. and the installation or preservation works of the telecommunications facilities, temporarily use the private, national or public telecommunications facilities, and the land, etc., within the limit of not substantially impeding a current use.

(2) No one may, without any justifiable reason, interfere with the temporary use of telecommunications facilities, and land, etc., for the purposes of the measurement of line tracks, etc. and the installation or preservation works of the telecommunications facilities under paragraph (1).

(3) A key communications business operator shall, when intending to temporarily use the private, national or public property under paragraph (1), notify the possessors, in advance, of the purposes and period of such use: provided, that in case where it is difficult to make a prior notification, a prompt notification shall be made during or after its use, and in case where such notification of the purposes and period of such use may not be made due to an obscurity of address and whereabouts of possessors, a public notice thereof shall be made.

(4) The temporary period of use of the land, etc. under paragraph (1) shall not exceed six months.

(5) A person who temporarily uses the private, national or public telecommunication facilities or the land, etc. under paragraph (1) shall carry the certificate indicating the authority, and present it to the persons related.

Article 74 (Entry to Land, etc.)

(1) A key communications business operator may enter others’ land, etc., when necessary for a measurement, examination, etc., for the installation and preservation of his telecommunications facilities: Provided, That in case where the place intended for such entry is a residential building, a consent from residents shall be obtained.

(2) No one may, without any justifiable reason, interfere with the temporary entry of telecommunications facilities, and land, etc., for the purposes of the measurement, examination, etc., for the installation and preservation of telecommunications facilities under paragraph (1).

(3) Article 73(3) and (5) shall be applicable in regard to providing notice and showing an identification when a person doing measurement or examination under paragraph (1) enters private or public land, etc.

Article 75 (Request for Elimination of Obstacles, etc.)

(1) A key communications business operator may request the owners or possessors of gas pipes, water pipes, drain pipes, electric lamp lines, electricity lines or private telecommunications facilities, which impede or are likely to impede the installation of line tracks, etc. or telecommunications facilities themselves (hereinafter referred to as the “obstacles, etc.”), for the removal, remodeling, repair and other measures with respect to the relevant obstacles, etc.

(2) A key communications business operator may request the owners or possessors to remove the plants, when they may impede or are likely to impede the installation or maintenance of line tracks, etc. or telecommunications themselves.

(3) A key communications business operator may, when the owners or possessors of the plants do not comply with the request under paragraph (2) or there exist any other unavoidable reasons, fell or transplant the relevant plants by obtaining permission from the Korea Communications Commission. In this case, a prompt notification shall be made to the owners or possessors of the relevant plants.

(4) The owners or possessors of the obstacles, etc., which impede or are likely to impede the telecommunications facilities of a key communications business operator, shall make a consultation in advance with the key communications business operator, when they are in need of a new construction, enlargement, improvement, removal or alteration of the relevant obstacles, etc.

Article 76 (Obligation for Restoration to Original State)

A key communications business operator shall restore the relevant land, etc. to its original state, when a use of the land, etc. under Articles 72 and 73 is finished or a need of providing the land, etc. for telecommunications service is gone, and in case where a restoration to the original state becomes impossible, make a proper compensation for damages suffered by the owners or possessors.

Article 77 (Compensation for Damages)

A key communications business operator shall, in case of incurring damages on others in case of Article 73 (1), 74 (1) or 75, make a proper compensation to the suffered person.

Article 78 (Procedures for Compensation for Damages on Land, etc.)

(1) When a key communications business operator compensates under Article 76 or 77 for any of the following reasons, it shall consult with the person has incurred losses.

1. temporary use of land under Article 73(1)

2. entry in land, etc. under Article 74(1)

3. moving, modifying, repairing obstacles or removal of plants under Article 75

4. inability to restore to the original state under Article 76

(2) When a consultation under paragraph (1) is not or cannot be made, an application for adjudications shall be filed with the competent Land Expropriation Commission under the Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor.

(3) Except for those as otherwise prescribed by this Act, the provisions of the Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor shall be applied mutatis mutandis to the criteria, methods and procedures regarding a compensation for damages, etc. to the land, etc. under paragraph (1), and an application for adjudications under paragraph (2).

Article 79 (Protection of Telecommunications Facilities)

(1) No person shall destruct the telecommunications facilities, and obstruct the flow of telecommunications by impeding the function of telecommunications facilities by means of having other objects contact them or by any other devices.

(2) No person shall stain the telecommunications facilities or damage the measurement marks of the telecommunications facilities by means of throwing objects to the telecommunications facilities or fastening an animal, vessel or a log raft thereto.

(3) A key communications business operator may, if necessary for the protection of submarine communications cable and their peripheral equipment (hereinafter referred to as the “Submarine Cable”), file an application to the Korea Communications Commission for the designation of alert areas for the Submarine Cable.

(4) Upon receiving an application pursuant to paragraph (3), the Korea Communications Commission may consider the necessity of such designation and may designate and publicly notify the alert areas for the Submarine Cable through consultation with the relevant state administrative agency.

(5) Designation applications, methods and procedures of such designation and its public notification, and methods of alert area indication shall be determined by the Enforcement Decree.

Article 80 (Moving of Facilities, etc.)

(1) The owners or possessors of the land, etc. may, in case where the telecommunications facilities of a key communications business operator have become an obstacle to a use of the land, etc. due to changes in the purpose of use or in the methods of using the land, etc. where such facilities are located, or the land adjacent to it, request a key communications business operator to move the telecommunications facilities, and take other measures necessary for removing the obstacles.

(2) A key communications business operator shall, upon receipt of a request under paragraph (1), take necessary measures, except for the cases where such measures are difficult to be taken for a business performance or technologies.

(3) Expenses necessary for taking the measures under paragraph (2) shall be borne by the person who provided the cause for the move or taking other measures necessary for removing the obstacles after the installation of the subject telecommunication facilities: Provided, That in the event the person who bears the expenses is the owner or possessor of the land and falls under any one of the following subparagraphs, the key communication business operator may reduce or exempt the person’s expenses, considering the indemnification amount paid at the time of installation of the telecommunication facilities and the amount of time it took to build the telecommunication facilities:

1. where the key communication business operator establishes and implements a plan to move the telecommunication facilities or remove other obstacles;

2. where the moving the telecommunication facilities or removal of other obstacles is beneficial to other telecommunication facilities;

3. where the state or a local autonomous entity demands such moving of telecommunication facilities or removal of other obstacles; or

4. where the telecommunication facilities within private land are being removed because they greatly obstruct the use of such land.

Article 81 (Cooperation of Other Organizations, etc.)

A key communications business operator may ask the related public agencies for a cooperation, in case where the operation of vehicles, vessels, airplanes and other carriers for the installation and preservation of his telecommunications facilities is necessary. In this case, the public agency in receipt of a request for cooperation shall comply with it, unless there exist any justifiable reasons.

Article 82 (Inspection — Report, Etc.)

(1) When necessary for establishing telecommunication policies and other cases specified under the Enforcement Decree of the Act, the Korea Communications Commission may inspect the facility status, accounting books and documents of installers of telecommunications facilities or demand them to make a report on the facilities.

(2) When there is an installer telecommunications facilities in violation of this Act, the Korea Communications Commission may order the removal of the relevant facilities or other necessary actions.

CHAPTER VI.- SUPPLEMENTARY PROVISIONS

Article 83 (Protection of Communication Secrecy)

(1) No person shall infringe on or divulge the secrecy of communication dealt with by telecommunications business operator.

(2) A person who is or has been engaged in the telecommunications service shall not divulge others’ secrecy obtained with respect to communication while in office.

(3) A telecommunications business operator may comply with a request for the perusal or the provision of the data falling under each of the following subparagraphs (hereinafter referred to as the “supply of communication data”) from a court, a prosecutor, the head of an investigation agency (including the head of any military investigation agency, the commissioner of the National Tax Service and the commissioners of regional Tax Offices; hereinafter the same shall apply) and the head of an intelligence and investigation agency, who intends to collect information or intelligence for the purpose of the prevention of any threat to a trial, an investigation (including an investigation of any transgression taken place during commission of any crime falling under Article 10(1), (3) or (4) of the Punishment of Tax Evaders Act), the execution of a sentence or the guarantee of the national security:

1. Names of users;

2. Resident registration numbers of users;

3. Addresses of users;

4. Phone numbers of users;

5. IDs of users (referring to the identification codes of users that are used to identify the rightful users of computer systems or communications networks); and

6. Dates on which users subscribe or terminate their subscriptions.

(4) The request for supply of communication data under paragraph (3) shall be made in writing (hereinafter referred to as a “written request for data supply”), which states a reason for such request, relation with the relevant user and the scope of necessary data: Provided, That where an urgent reason exists that makes a request in writing impossible, such request may be made without resorting to writing, and when such reason disappears, a written request for data supply shall be promptly filed with the telecommunications business operator.

(5) A telecommunications business operator shall, where he has supplied the communication data pursuant to the procedures of paragraphs (3) and (4), keep the ledgers as prescribed by the Enforcement Decree, which contain necessary matters such as the facts of supplies of communication data, and the related data such as the written requests for data supply, etc.

(6) A telecommunications business operator shall report, to the Korea Communications Commission, twice a year the current status, etc. of supplying the communication data, by the methods prescribed by the Enforcement Decree, and the Korea Communications Commission may check whether the content of a report made by a telecommunications business operator is authentic and the management status of related data according to paragraph (5).

(7) A telecommunications business operator shall, by the methods prescribed by the Enforcement Decree, notify the contents entered in the ledgers according to paragraph (5) to the head of a central administrative agency whereto a person requesting supply of communications data according to paragraph (3) belongs: Provided, That in the event that a person who asks for providing the communications data is a court, the relevant telecommunications business operator shall notify the Minister of the Court Administration thereof.

(8) A telecommunications business operator shall establish and operate a setup in full charge of the affairs related to the users’ communication secrets; and the matters concerning the function and composition, etc. of the relevant setup shall be prescribed by the Enforcement Decree.

(9) Matters necessary for the scope of persons holding the decisive power on written request for data supply shall be prescribed by the Enforcement Decree.

Article 84 (Notice of Transmitter’s Telephone Number)

(1) The telecommunications business operator may, upon request from the recipient, notify him of the transmitter’s telephone number, etc.: Provided, That this shall not apply to the case where the transmitter expresses his content to refuse the transmission of his telephone number.

(2) Notwithstanding the proviso of paragraph (1), the telecommunications business operator may, in any of the following cases notify the recipient of the transmitter’s telephone number, etc.

1. in case where the recipient requests according to the requisites and procedures set by the Enforcement Decree in order to protect the recipients from the violent language, intimidations, harassments, etc.

2. Of the special telephone number services, those necessary for national security, crime prevention, disaster response, etc. as specified under the Enforcement Decree of the Act.

(3) No person shall alter the caller’s telephone number or display an erroneous telephone number for profit or for the purpose of inflicting harm on others violent language, intimidations, harassments, etc.

(4) No person shall provide services that enable another to alter the caller’s telephone number or display an erroneous telephone number for profit. Provided, this provision under paragraph (4) shall not apply in the event any justifiable grounds for exception exist (e.g., for public interest or recipient’s convenience).

Article 85 (Restriction and Suspension of Business)

The Korea Communications Commission may order the telecommunications business operators to restrict or suspend the whole or part of telecommunications service under the conditions as prescribed by the Enforcement Decree, when there occurs or is likely to occur a national emergency of war, incident, natural calamity, or that corresponding to them, or when other unavoidable causes exist, and when necessary for securing important communications.

Article 86 (Approval for International Telecommunications Services)

(1) When there exist special provisions in the treaties or agreements on international telecommunications business joined by the Government, those provisions shall govern.

(2) A telecommunications business operator shall, where he intends to conclude international telecommunications business as prescribed by the Enforcement Decree, obtain approval from the Korea Communications Commission fulfilling the requisites prescribed by the Enforcement Decree. The same shall apply to the case where he intends to alter or abolish such agreement or contract.

(3) A telecommunications business operator providing key communications services shall, where he concludes an agreement or a contract with a foreign government or a foreigner with respect to the adjustments of fees following the handling of international telecommunications services, report such to the Korea Communications Commission, provided that the foregoing is not applicable in case the size of telecommunications facilities, paid-in capital, number assignment, etc. satisfy the standards specified under the Enforcement Decree of the Act.

(4) Notwithstanding paragraph (3), when an agreement is to be entered into for the adjustments of fees for international telecommunications through the joint use of radio telecommunications facilities, approval from the Korea Communications Commission shall be necessary.

(5) Details on the report under paragraph (3) or authorization under paragraph (4) shall be determined and publicly announced by the Korea Communications Commission.

Article 87 (Transboundary Provision of Key Communications Services)

(1) A person, who intends to provide key communications service from abroad into the homeland without establishing a domestic business place (hereinafter referred to as the “transboundary provision of key communications services”), shall conclude a contract on transboundary provision of key communications services with a domestic key communications business operator or a specific communications business operator who provides the same key communications service.

(2) The provisions of Articles 28, 32, 33, 45 through 47, 50 through 55, 83 through 85, 88 and 92 and Article 44-7 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, etc. shall apply mutatis mutandis to the provision of services as determined in a contract by a key communications business operator or a specific communications business operator who has concluded the contract under paragraph (1).

(3) Where a person, who intends to provide a transboundary key communications service under paragraph (1), or a key communications business operator or a specific communications business operator, who has concluded a contract with him, violates the relevant provisions which applies mutatis mutandis under paragraph (2), the Korea Communications Commission may cancel approval under Article 86 (2), or issue an order to suspend a transboundary provision of the whole or part of key communications services as determined in the relevant contract, with fixing a period of not more than one year.

(4) Criteria and procedures, etc. for dispositions under paragraph (3) and other necessary matters shall be determined by the Enforcement Decree.

Article 88 (Report, etc. on Statistics)

(1) A telecommunications business operator shall report the statistics on a provision of telecommunications service as prescribed by the Enforcement Decree, such as a current status of facilities by telecommunications service, subscription record, current status of users, and the data related to telephone traffic required for the imposition and collection of fees, to the Korea Communications Commission under the conditions as determined by the Enforcement Decree, and keep the related data available.

(2) A key communications business operator and stockholders thereof, or the specific communications business operator and stockholders thereof shall submit the related data necessary for a verification of the facts of Article 8, pursuant to the provisions of the Enforcement Decree.

(3) The Korea Communications Commission may, in order to verify the facts under paragraph (2), or to examine the genuineness of the data submitted, request the administrative agencies and other related agencies to examine the data submitted or to submit the related data. In this case, the agencies in receipt of such request shall accede thereto unless there exist any justifiable reasons.

Article 89 (Hearing)

The Korea Communications Commission shall, in case where he intends to make a disposition falling under any of the following subparagraphs, hold a hearing:

1. Cancellation, in whole or part, of license for a key communications business operator under Article 20 (1);

2. Cancellation, in whole or part, of registration of a specific communications business under Article 27 (1);

3. Closedown, in whole or part, of a value-added communications business under Article 27 (2); and

3. Cancellation of approval under Article 87 (3).

Article 90 (Imposition of Penalty Surcharge, etc.)

(1) The Korea Communications Commission may impose a penalty surcharge equivalent to the amount of not more than 3/100 of the sales amount that is calculated under the conditions as prescribed by the Enforcement Decree in lieu of the relevant business suspension, in case where he has to order a business suspension to a telecommunications business operator who falls under subparagraphs of Article 20 (1) or subparagraphs of Article 27 (1) and (2), or a suspension of relevant business is likely to cause substantial inconveniences to the users, etc. of relevant business or to harm other public interests. If the telecommunications business operator refuses to submit the data used for calculation of turnover or submits erroneous data, an estimate of the turnover can be assessed based on the financial statement of those who provide similar services in the same industry (accounting documents, number of subscribers, usage fee and business operation status): Provided, That in the event that the sales amount is nonexistent or difficult to calculate the sales amount, as prescribed by the Enforcement Decree, the Minister of Information and Communication may impose a penalty surcharge not exceeding 1 billion won.

(2) When the Korea Communications Commission orders cessation of use in regard to proprietary telecommunications facilities under Article 67(2), it may replace such order with a penalty surcharge not exceeding 1 billion won if such order causes significant inconvenience to users of telecommunication services provided with the use of the relevant proprietary telecommunications facilities or other public harm is expected.

(3) Specific standards for the imposition of penalty surcharge under paragraph (1) and (2) shall be determined by the Enforcement Decree.

(4) Article 53(5) through (7) shall apply in regard to additional dues of penalty surcharge, demand for payment and return-additional dues of penalty surcharge under paragraph (1) and (2).

Article 91 (Extension of Time Limit of Payment of Penalty Surcharge and Payment in Installments)

(1) Where a penalty surcharge to be paid by a telecommunications business operator under Articles 53 and Article 90 exceeds the amount as prescribed by the Enforcement Decree, and where deemed that a person liable for a payment of penalty surcharge finds it difficult to pay it in a lump sum due to the reasons falling under any one of the following subparagraphs, the Korea Communications Commission may either extend the time limit of payment, or have him pay it in installments. In this case, the Korea Communications Commission may, if deemed necessary, have him put up a security therefor:

1. Where he suffers a severe loss of property due to natural disasters or fire;

2. Where his business faces a serious crisis due to an aggravation of his business environments; and

3. Where it is expected that he will be in great financial difficulty if he pays the penalty surcharge in a lump sum.

(2) Matters necessary for an extension of the deadline for payment of a penalty surcharge, the payment in installments and the laying of a security shall be prescribed by the Enforcement Decree.

Article 92 (Correction Orders, etc.)

(1) The Korea Communications Commission shall issue correction orders in case where a telecommunications business operator falls under any of the following subparagraphs:

1. Where it violates Articles 3, 4, 6, 9 through 11, 14 through 24, 26 through 28, 30 through 44, 47 through 49, 51, 56 through 62, 64 through 67, 69, 73 through 75, 79 or 82 through 88 or any order thereunder;

2. Where the procedures for business performances of telecommunications business operator are deemed to inflict significant harms on the users’ interests; and

3. Where he fails to take swift measures necessary for removing obstructions such as repairs, etc. when impediments have occurred to the supply of telecommunications services.

(2) The Korea Communications Commission may order a telecommunications business operator to conduct the matters of the following subparagraphs, when necessary for development of telecommunications:

1. Integrated operation and management of telecommunications facilities, etc.;

2. Expansion of communications facilities for the enhancement of social welfare;

3. Construction and management of communications networks for important communications to achieve efficient performance of State’s functions; and

4. Other matters as prescribed by the Enforcement Decree.

(3) The Korea Communications Commission may order the persons falling under any of the following subparagraphs to take measures, such as the suspension of acts to provide telecommunications service or the removal of telecommunications facilities, etc.:

1. Persons who operate a key communications business without obtaining a permit under Article 6 (1);

2. Persons who operate a specific communications business without making a registration under Article 21 (1); and

3. Persons who operate a value-added communications business without making a report under Article 22 (1).

Article 93 (Delegation and Entrustment of Authority)

The authority of the Korea Communications Commission under this Act may be delegated and entrusted in part to the head of the affiliated agencies under the conditions as prescribed by the Enforcement Decree.

CHAPTER VII.- PENAL PROVISIONS

Article 94 (Penal Provisions)

A person falling under any of the following subparagraphs shall be punished by imprisonment for not more than five years or by a fine not exceeding 200 million won:

1. A person who runs a key communications business without obtaining a license under Article 6 (1);

2. A person who has operated key communications services in violation of partial cancellation of license under Article 20(1);

3. A person who obstructs the flow of telecommunications by impeding a function of telecommunications facilities by means of damaging telecommunications facilities, or having the objects contacted thereon and other methods, in violation of Article 79 (1);

4. A person who divulges other’s secrets with respect to communications which have been known to him while in office, in violation of Article 83 (2); and

5. A person who supplies communication data, and person who receives such supply, in violation of Article 83 (3).

Article 95 (Penal Provisions)

A person falling under any of the following subparagraphs shall be punished by imprisonment for not more than three years or by a fine not exceeding 150 million won: (Amended by Act nº 10656, May 19, 2011)

1. A person who refuses a provision of telecommunications service without any justifiable reasons, in violation of Article 3 (1);

2. A person who violates a disposition taken to suspend his business under Article 20 (1);

3. A person who operates a specific communications business without making a registration under Article 21 (1) or a person who operates a value-added communications business without making a registration under 3-2, Article 22(2);

4. A person who has operated specific communications services in violation of partial cancellation of license under Article 27(1);

5. A person who fails to implement an order under Article 52 (1);

6. A person who obstructs the measurement of line tracks, etc. and the installation and preservation activities of telecommunications facilities under Article 73 (2); and

7. A person who encroaches upon or divulges a secret of communications handled by telecommunications business operator, in violation of Article 83 (1).

Article 96 (Penal Provisions)

A person falling under any of the following subparagraphs shall be punished by imprisonment for not more than two years or by a fine not exceeding 100 million won:

1. A person who fails to obtain a modified license under Article 16;

2. A person who fails to obtain approval under Articles 17 (1) and 42 (4);

3. A person who fails to obtain an authorization under the text of Article 18 (1) other than sub-paragraphs or approval according to Article 19 (1);

4. A person who violates Article 18 (9) by unifying communication networks, appointing officers, executing any other activities such as transferring, consolidating, enforcing a facilities sales contract or taking follow-up measures relating to establishment of a company before receiving a license ;

5. A person who violates user protection measures ordered under Article 19(2);

6. A person who runs the value-added communications business without making a report under Article 22(1);

7. A person who violates a disposition taken to suspend his business under Article 27(1);

8. A person who fails to execute the order given to discontinue his business under Article 27 (2);

9. A person who fails to subscribe for a guarantee insurance in violation of Article 32(3);

10. A person who discloses, uses or provides the information, in violation of the main body of Article 43 (1) or paragraph (2) of the same Article;

11. A person who fails to implement the partial restriction or cessation measure ordered pursuant to Article 85; and

12. A person who fails to obtain approval, approval for alteration, or approval for abolition, under Article 86 (2) or (4).

Article 97 (Penal Provisions)

A person falling under any of the following subparagraphs shall be punished by imprisonment for not more than one year or by a fine not exceeding 50 million won:

1. A person who fails to execute the order given under Articles 10(5), 18 (8) or 12 (2) (including a case where the provisions are applied mutatis mutandis under Article 4 (4) of the Addenda of the Telecommunications Business Act (Amended by Act nº 5385);

2. A person who fails to make a report under provisos of Article 18 (1) other than sub-paragraphs;

3. A person who fails to make a modified registration or a modified report under Article 23;

4. A person who fails to make a report under Article 24;

5. A person who violates a disposition taken to suspend his business under Article 27 (2);

6. A person who provides telecommunications service without making a report or modification report under Article 28(1) and the proviso of (2) or receiving an authorization or modification approval under paragraph (2) of the same Article; and

7. A person who intermediates other person’s communication or furnishes for use by other person, by making use of telecommunications services rendered by the telecommunications business operator, in contravention of the provisions of the text of Article 30 other than subparagraphs.

Article 98 (Penal Provisions)

A person falling under any of the following subparagraphs shall be punished by imprisonment for not more than one year or by a fine not exceeding 10 million won:

1. A person who installs or modifies significant telecommunications facilities without making a report under the main text of Article 62(1) or has installed telecommunications facilities without obtaining approval under the proviso of the same Article

2. A person who installs proprietary telecommunications facilities without making a report or modification report under Article 64(1)

3. A person who interconnects other’s communication through proprietary telecommunication facilities or uses it outside its purpose in violation of Article 65(1)

4. A person who violates an order under Article 66(1) to handle telecommunication services or other communication services or connect the pertinent facilities to other telecommunications facilities

5. A person violates a usage cessation order under Article 67(2) or an order under paragraph (3) of the same article

6. A person violates an order for removal of telecommunications facilities or other corrective measures under Article 82(2)

Article 99 (Penal Provisions)

A person who commits any of the prohibited acts under Article 50(1) (excluding providing telecommunications services not in accordance with the standard usage terms and conditions under Article 50(1)5) shall be punished by a fine not exceeding 300 million won.

Article 100 (Penal Provisions)

A person falling under any one of the following subparagraphs shall be punished by a fine not exceeding 50 million won:

1. A person who deceives another for profit or alters his telephone number or displays a fraudulent telephone number for the purpose of inflicting harm through violent language, intimidations, harassment, etc. in contravention of Article 84 (3); and

2. A person who provides services that enable another to alter the caller’s telephone number or display an erroneous telephone number for profit in violation of Article 84 (4).

Article 101 (Penal Provisions)

A person who stains the telecommunications facilities or damages the measurement marks of the telecommunications facilities, in violation of Article 79 (2) shall be punished by a fine or penalty not exceeding one million won.

Article 102 (Attempted Criminal)

An attempted criminal under subparagraphs 3 and 4 of Article 94 and subparagraph 7 of Article 95 shall be punished.

Article 103 (Joint Penal Provisions)

When a representative of a juristic person or an agent, an employee or any other employed person of the juristic person or individual commits violation under Articles 94 through 100 in connection with the business of such juristic person or individual, then a fine under the related Article shall be imposed on the juristic person or individual, in addition to the punishment of the violator except in cases where such juristic person or individual has not been lax in exercising due care and supervision in regard to the relevant business to prevent such violation.

Article 104 (Fine for Negligence)

(1) A person who falls under any one of the following subparagraphs shall be punished by a fine for negligence not exceeding 30 million won:

1. A person who refuses or impedes a temporary use of private telecommunications facilities or lands under Article 73 (2), without justifiable reasons;

2. A person who refuses or impedes an entry to the land, etc. under Article 74 (2), without justifiable reasons;

3. A person who refuses the moving, alteration, repair and other measures on the obstacles, etc. under Article 75 (1), or the request for removal of the plants under Article 75 (2), without justifiable reasons;

(2) A person who fails to apply for approval in regard to execution of an agreement in violation of Article 44(2) shall be punished by a fine not exceeding 20 million won.

(3) A person falling under any of the following shall be punished by a fine not exceeding 15 million won:

1. A person who fails to report in regard to execution of an agreement in violation of Article 44(1)

2. A person who fails to make a report under the main text of Article 86(3)

(4) A person who falls under any one of the following subparagraphs shall be punished by a fine for negligence not exceeding ten million won:

1. A person who fails to make a report as referred to in Article 10 (2) or to comply with a request for providing the data or an order to attend as referred to in Article 11 (3) or (4);

2. A person who, in violation of Article 19 (1), fails to notify the user 60 days prior to the expected date of termination;

3. A person who fails to make a report under Article 26;

4. A person who violates the obligation concerning the protection of users under Article 32 (1);

5. A person who fails to carry out request for information under Article 35(5) or submits false information

6. A person who fails to make a public announcement of the technical standards, and the standards for use and provision, or the standards for a creation of fair competitive environments, in violation of Article 42 (4);

7. A person who fails to observe the publicly announced matters under Article 48(2), in violation of Article 48 (3);

8. A person who refuses, avoids or hampers an order for submission, or an investigation, of the data or articles according to Article 51 (2);

9. A person who refuses, avoids, or intervenes with the order to submit information or object under Article 51 (5), or the temporary custody of the information or object submitted under the same Article;

10. A person who fails to execute orders given to furnish related data under the provisions of Article 56 (3);

11. A person who has used proprietary telecommunications facilities without receiving confirmation under Article 64(3)

12. A person who refuses or interferes with inspection under Article 82(1)

13. A person who fails to report under Article 82(2) or makes a false report

14. A person who fails to keep related data or makes false entries in such data, in contravention of the provisions of Article 83 (5);

15. A person who does not report the contents in the ledgers, including provision of telecommunications data, to the head of central administrative agency in violation Article 83(7)

16. A person who fails to make reports or submit the data under Article 88, or falsely do such acts; and

17. A person who fails to follow correction orders, etc., under Article 92.

(5) The fine for negligence under paragraph (1) through (4) shall be imposed and collected by the Korea Communications Commission, under the conditions as prescribed by the Enforcement Decree.

ADDENDA (Act nº 10656, May 19, 2011)

(1) (Enforcement Date) This Act shall be effective 6 months after the date of its announcement.

(2) (Grandfathering Clause for Registration of Value-added Communications Business)

A person who operates a value-added communications business at the time this Act comes into effect under the previous provisions, and is required to be registered under the amended Article 22(2) shall make a registration within 6 months after the enforcement date.