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Selected Statutes of the Republic of Korea |
Wholly Amended by Act No. 5506, Jan. 13, 1998
Amended by Act No. 5739, Feb. 1, 1999
Act No. 5982, May 24, 1999
Act No. 6018, Sep. 7, 1999
Act No. 6187, Jan. 21, 2000
Act No. 6204, Jan. 28, 2000
Act No. 6256, Jan. 28, 2000
Act No. 6957, Jul. 30, 2003
Act No. 7428, Mar. 31, 2005
Act No. 8145, Dec. 30, 2006
Act No. 8635, Aug. 3, 2007
Act No. 8840, Jan. 17, 2008
Act No. 8852, Feb. 29, 2008
Act No. 8863, Feb. 29, 2008
CHAPTER I GENERAL PROVISIONS
Article 1 (Purpose)
The purpose of this Act is to contribute to the economic development of
local communities by enhancing the economic and social status of the members of credit unions through healthy growth
of credit unions based
on common bond, and also providing the residents of local communities with convenience in banking transactions.
Article 2 (Definitions)
The terms used in this Act are defined as follows: <Amended by Act No. 5739,
Feb. 1, 1999; Act No. 6256, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
1. The term “credit union (hereinafter referred to as “union”)” refers to
a non-profit legal entity established under this Act in order to achieve the purpose articulated in Article 1;
2. The term “National Credit Union Federation of Korea (hereinafter
referred to as the “National Federation”)” refers to a non-profit legal
1
entity established under this Act with an objective of pursuing the
common interest of unions;
3. The term “common bond” means a unit that determines the qualification for the establishment of a union and the membership
thereof;
4. The term “union member” meas a person who is qualified for the membership as provided for in Article 11
(1) and thus admitted to
a union as provided for in the articles of association of the union;
5. The term “illegal or non-performing loan” means the money disbursed by a union as a loan or discount of notes
(hereinafter referred to as
“loan, etc.”), or as provisional payment (hereinafter referred to as
“provisional payment”), falling under either of the following items: (a) A loan granted in violation of the provisions of Article
42; or
(b) A loan or a provisional payment considered difficult or impossible to collect and falling under the criteria prescribed
by the Financial Services Commission (hereinafter referred to as “non-performing
loan”);
6. The term “standard articles of association” refers to the articles of association established by the National
Federation to provide for the
matters necessary for the establishment and management of unions in details and apply them to all unions uniformly;
7. The term “standard regulations” means the regulations established
by the National Federation to provide for the matters necessary for the management of unions in details and apply
them to all unions uniformly;
8. The term “local union” means a union established on the basis of a common bond of one and the same administrative
district, economic zone, or life boundary; and
9. The term “equity capital” means the aggregate of the capital, reserves, other retained earnings, etc. in the amount
as specified by Presidential Decree.
Article 3 (Name)
(1) Each union shall include the word “credit union” or “sin-hyeob” in its
name. <Amended by Act No. 5739, Feb. 1, 1999>
(2) No one else but unions and the National Federation may use the words
“credit union” or any similar word in its name. <Amended by Act No. 5739, Feb.
1, 1999>
2
Article 4 (Registration)
(1) Unions and the National Federation are duly formed only upon the
completion of the registration of their establishment with the competent authority having jurisdiction over their principal
place of business.
(2) The register office shall keep the “credit union register” separately.
(3) Necessary matters concerning the registration of unions and the
National Federation shall be prescribed by Presidential Decree, in addition to the provisions of this Act.
Article 5 (Cooperation with Other Unions and Cooperatives)
(1) The National Federation shall strive to promote reciprocal cooperations,
enhance mutual interests, and develop joint projects, together with cooperatives and unions under other Acts.
(2) The National Federation may organize and run a council jointly with cooperatives and unions under any other Act, if
necessary for accomplishing
the purpose articulated in paragraph (1).
Article 6 (Relations to Other Acts)
(1) The provisions of the Insurance Business Act shall not apply to the
mutual aid service of unions and the National Federation.
(2) With respect to a merger between unions, the provision of Article
5 (9) of the Act on the Structural Improvement of the Financial Industry shall apply. <Amended by Act No. 5739, Feb. 1, 1999>
(3) The credit service division of the National Federation under the provisions of Article 78 (1) 5 (c)
(applicable only to domestic exchange) and (d) shall be deemed to be a financial institution under the provisions
of Article 2 of the Banking Act and Article 11 of the Bank of Korea Act.
(4) For the purpose of applying the provision of Article 45-2 of the Act on the Efficient Disposal of Non-Performing
Assets, etc. of Financial
Institutions and the Establishment of Korea Asset Management Corporation, a union shall be deemed to
be the one falling under one of subparagraphs of paragraph (1) of the same Article of said Act. <Newly
inserted by Act No. 6957, July 30, 2003>
CHAPTER Ⅱ UNION
SECTION 1 ESTABLISHMENT
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Article 7 (Establishment)
(1) In order to establish a union, 30 or more promoters who belong to
the common bond of the union shall prepare the articles of association with a resolution of its organizational general
meeting, and shall obtain
an authorization of the Financial Services Commission through the Chairperson of the National Federation
(hereinafter referred to as the “National Federation Chairperson”), as prescribed by Presidential Decree.
<Amended by Act No. 5739, Feb. 1, 1999; Act No. 5982, May 24, 1999; Act No. 8863, Feb. 29, 2008> (2) The resolution of the organizational general meeting require the presence of a majority of the persons who have submitted to the
representative of the promoters their written consent to the establishment of the union no later than the day before the
opening day of the meeting and the affirmative vote of at least two-thirds of those present at the meeting.
(3) Any person who desires to obtain the authorization under the provision of paragraph (1) shall submit an application
to the Financial Services
Commission as prescribed by Presidential Decree. <Newly Inserted by Act No.
6256, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
(4) The Financial Services Commission may attach a condition to the
authorization under the provision of paragraph (1). <Newly Inserted by Act
No. 6256, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
Article 8 (Requirements for Authorization)
(1) Any person who desires to obtain an authorization for establishment
of a union under the provision of Article 7 (1) shall meet the following requirements: <Amended by Act No. 6256, Jan. 28, 2000>
1. He/she shall meet the requirements set forth in the provision of each
subparagraph of Article 14 (4);
2. He/she shall have professional human resources and physical facilities including an electronic computer system enough
to protect the union
members and carry out the union’s business;
3. The business plan shall be feasible and sound; and
4. The promoters shall have sufficient ability to invest, sound financial standing and good social credibility.
(2) The Financial Services Commission shall, upon receiving an application for establishment of a union, shall notify
the applicant of whether to
authorize it within a period of time as prescribed by Presidential Decree.
4
In such cases, the ground for rejection shall be clearly stated, if the
application for authorization is rejected. <Amended by Act No. 5739, Feb. 1, 1999;
Act No. 5982, May 24, 1999; Act No. 8863, Feb. 29, 2008>
(3) Necessary matters concerning the detailed requirements for the
authorization under the provision of paragraph (1) shall be prescribed by Presidential Decree. <Newly Inserted by Act No. 6256, Jan. 28, 2000>
Article 8-2 (Public Notification of Authorization, etc.)
Whenever the authorization under the provision of Article 7 (1) is granted
or an authorization is revoked in accordance with the provisions of Article
85, the Financial Services Commission shall publish the details of such authorization or revocation without delay,
and shall make the contents known to the general public through computer telecommunications system
and the like. <Amended by Act No. 8863, Feb. 29, 2008>
[This Article Newly Inserted by Act No. 6256, Jan. 28, 2000]
Article 9 (Common Bond and Place of Business)
(1) The common bond of a union shall be prescribed by the articles of
association mainly based on its administrative district, economic zone, life zone, workplace, organization, and so
forth. In such cases, the matters
concerning the scope, type, and change of common bond shall be prescribed by Presidential Decree.
(2) A union’s principal place of business shall be prescribed by its articles
of association.
(3) A union may have branch offices with an approval of the National
Federation Chairperson.
Article 10 (Mandatory Descriptions of the Articles of Association)
The articles of association of each union shall contain the following
descriptions: <Amended by Act No. 5739, Feb. 1, 1999>
1. Purpose;
2. Name;
3. Address of the principal place of business;
4. Matters concerning common bond;
5. Matters concerning qualification, admission, withdrawal, expulsion of members;
6. Value per invested share, and the method and term for the payment
for shares;
7. Matters concerning the rights and duties of union members;
5
8. Matters concerning the scope of business and accounting;
9. Matters concerning executives and organs;
10. Matters concerning dissolution;
11. Method of public notice;
12. Matters concerning transfer of shares; and
13. Other matters necessary for management of the general meeting and so forth.
SECTION 2 UNION MEMBER AND INVESTMENT
Article 11 (Eligibility for Membership)
(1) A person shall be eligible for membership of a union, if he/she belongs
to the union’s common bond and has paid the first installment of his/her investment.
(2) Notwithstanding the provision of paragraph (1), a union may admit persons who do not belong to its common bond as its
members, as specified
by Presidential Decree, within the extent not deviating from its purpose of establishment or hindering its efficient
management. <Amended by Act No. 5739, Feb. 1, 1999>
(3) The number of union members of a union shall be not less than 100 persons.
Article 12 Deleted <by Act No. 5739, Feb. 1, 1999>
Article 13 (Capital)
The capital of a union shall be the aggregate amount of the investment
paid by its members.
Article 14 (Share in Invested Capital, etc.)
(1) Each member of a union shall own at least one share of the invested
capital.
(2) The value per share shall be prescribed by the articles of association.
(3) The maximum number of shares held by a union member may not exceed 10 percent of total number of outstanding shares.
(4) The minimum limit of the aggregate amount of the invested capital shall be as follows: <Amended by Act No. 6256, Jan. 28, 2000>
1. In case of a local union, the amount set forth in one of the following items, depending upon the location of its principal
place of business:
(a) The Special Metropolitan City or a Metropolitan City: 300 million
6
won;
(b) Si: Two hundred million won; or
(c) Gun (including Eup and Myeon located within a Metropolitan City or Si; the same shall apply hereinafter): 50 million won;
2. In case of a workplace union: 40 million won; or
3. In case of an organization union, the amount set forth in one of the following items depending upon the location of
its principal place of
business:
(a) The Special Metropolitan City or a Metropolitan City: 100 million won;
(b) Si: 80 million won; or
(c) Gun: 50 million won.
(5) The investment in a union shall be paid in cash, and shall not be set off against a claim receivable from the
union.
(6) The shares in invested capital paid by a member of a union may not
be subject to a pledge right. <Newly Inserted by Act No. 6957, Jul. 30, 2003>
Article 15 (Transfer)
(1) A member of a union may transfer his/her share to another member
in accordance with the provisions of the articles of association. <Amended by Act No. 5739, Feb. 1, 1999>
(2) A transferee of shares shall succeed to the rights and duties of the transferor.
(3) No union member may own a share jointly or in common with another member.
Article 16 (Withdrawal)
(1) A union member may notify the union of his/her intention to withdrawal
in advance to withdraw from the union in accordance with the provisions of the articles of association.
(2) A member shall be deemed to be withdrawn from a union, if and when
one of the following events or causes occurs: <Newly Inserted by Act No. 6957, Jul. 30, 2003>
1. Forfeiture of qualification for membership;
2. Death;
3. Bankruptcy;
4. The incompetent; or
5. Dissolution of the legal entity, if the union member is a legal entity.
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(3) The matters concerning the forfeiture of qualification for membership
under paragraph (2) 1 shall be provided for by the articles of association.
<Amended by Act No. 5739, Feb. 1, 1999>
Article 17 (Refund of the Investment to the Withdrawing Member)
A union shall refund the invested money, deposits, and installment savings
to its member immediately when the member withdraws from the union. In such cases, the dividend for the investment
may be paid at the time
when dividends are distributed to other members.
Article 18 (Expulsion)
(1) A union may expel a union member by a resolution of the general
meeting, if the member falls under any of the following subparagraphs:
<Amended by Act No. 6256, Jan. 28, 2000>
1. If the union member fails to pay his/her investment or perform his/her obligation to the union;
2. If the union member violates any provision of this Act or an order issued under this Act, or breaches any provision
of the articles of association;
3. If the union member does not use the service set forth in item (a), (b), or (f) of Article 39 (1) 1 for two years
or longer; or
4. If the value of the share held by the union member has been less
than one share for six months or longer.
(2) A union shall, if it considers to expel a member in accordance with the provision of paragraph (1), notify the member
of the ground for expulsion
at least ten days earlier than the opening date of the general meeting, and shall give him/her an opportunity to make
a statement at the general meeting.
(3) A resolution adopted by the general meeting to expel a union member without giving the member an opportunity to
make a statement under the provision of paragraph (2) shall not be valid or effective against the
member.
Article 19 (Voting Right, Elective Right, etc.)
(1) Each member of a union shall have an equal right to vote and elect,
regardless of the number of shares held by him/her: Provided, That a member’s rights to vote and elect may be limited, if the member is a minor
or has not maintained his/her membership of the union properly for at least three months. <Amended by Act No. 6256, Jan. 28, 2000>
8
(2) Members of a union may be allowed to exercise their rights to vote
and elect by proxy: Provided, That the members of a union established on the basis of a common bond of locality or an organization may not
allow its members to exercise their right to vote or elect by proxy.
(3) The number of union members whom one proxy is allowed to represent under the provision of paragraph (2) shall be provided
for by the articles
of association.
(4) The proxy under the provision of paragraph (2) shall submit to the union a document certifying his/her proxy.
Article 20 (Union Member’s Liability)
Each union member’s liability shall be limited to the amount invested
by the member.
Article 21 Deleted <by Act No. 5739, Feb. 1, 1999>
Article 22 (Request for Revocation of Resolution, etc.)
(1) Any member who has an objection to the effect of a resolution of the
general meeting or an election of an executive may request the National
Federation Chairperson to revoke the resolution or the result of the election with the consent from at least ten percent
of the members of the union
within one month of the date of resolution or election.
(2) The National Federation Chairperson shall notify the requesting union member of the results of the measures taken
by the Chairperson within
three months.
SECTION 3 ORGANS
Article 23 (General Meeting)
(1) A union shall have the general meeting.
(2) The general meeting shall be composed of the union members, and the annual general meeting shall be called by the
president of the union once a fiscal year, while an extraordinary general meeting may be called
if the union president considers it necessary or upon a request of the union members or the auditor under the provision
of Article 26. <Amended by Act No. 6957, Jul. 30, 2003>
(3) The union president shall take the chair of the general meeting.
Article 24 (Matters subject to Resolution of General Meeting, etc.)
(1) The following matters shall be subject to resolution of the general
9
meeting:
1. Amendment of the articles of association;
2. Final decision on business plan and budget;
3. Election and removal of executives;
4. Approval of the report on the settlement of accounts (including the business report, the balance sheet, the
income statement, and the
retained earnings appropriation plan or the deficit disposition plan;
the same shall apply hereinafter);
5. Approval of the auditor’s report;
6. Dissolution, merger, split-off, or suspension of operations of the union;
7. Expulsion of a union member;
8. Establishment, amendment, or repeal of bylaws; and
9. Other necessary matters as specified by the articles of association.
(2) An amendment of the articles of association under the provision of paragraph (1) 1 shall be registered with
an approval of the National
Federation Chairperson: Provided, That an amendment made in accordance with the standard articles of association under the provision of Article
75 (1) 1 does not require an approval of the National Federation
Chairperson.
Article 25 (Opening and Resolution of General Meeting)
(1) The general meeting shall be duly formed to open with the presence of a majority of the registered union members, and
shall adopt a resolution
with the affirmative vote of a majority of the union members present at the meeting, unless there is any provision otherwise
in this Act: Provided,
That the due formation of the general meeting of a union that has more than five hundred registered members requires
the presence of at least
251 members, and a resolution thereof requires the affirmative vote of
a majority of the members present at the meeting. <by Act No. 5739, Feb. 1,
1999>
(2) A resolution concerning any matter specified in subparagraph 1 through
6 of Article 24 (1) shall be adopted with the affirmative vote of at least two-thirds of the members present at the meeting.
(3) With respect to an issue on which there are conflicting interests between
the union and one of its members, the interested member may not participate in the proceedings for the resolution of the issue.
<Amended by Act No. 6256, Jan. 28, 2000>
10
Article 26 (Request for Calling General Meeting)
(1) A union member may request the union president to call the general
meeting by submitting a written request stating the purpose of the meeting and the reason for calling the meeting with
the consent from at least
one-fifths of the members.
(2) The auditor may request the union president to call the general meeting by submitting a written request stating the
purpose of the meeting and
the reason for calling the meeting, if a wrong or fraud is discovered as a result of his/her audit under the provisions
of Article 37 and it is necessary to report his/her discovery in detail to the general meeting promptly.
<Amended by Act No. 6957, Jul. 30, 2003>
(3) The union president shall, upon receiving the request under paragraph
(1) or (2), hold the general meeting within fifteen days. <Amended by Act
No. 6957, Jul. 30, 2003>
(4) If there is no person who has an authority to call the general meeting, or the union president omits to hold the general meeting within the period of time prescribed in paragraph (3) without a justifiable ground, the auditor shall call the meeting without delay. In such cases, the auditor shall take the chair of the general meeting on behalf of the union president. <Amended
by Act No. 6957, Jul. 30, 2003>
(5) If the auditor does not call the general meeting in accordance with the provision of paragraph (4) even at the
request of members to call the meeting under the provision of paragraph (1), the representative of the members
requesting the general meeting under the provision of paragraph (1) shall call the meeting. In such cases,
the representative of the members shall take the chair of the general meeting on behalf of the union president. <Amended by Act No. 6957, Jul. 30, 2003>
(6) When the general meeting is called under the provision of paragraph
(4) or (5), it shall be reported to the National Federation Chairperson in advance. <Amended by Act No. 6957, Jul. 30, 2003>
Article 27 (Executives)
(1) A union shall have no less than five, but no more than nine directors
including one president and one vice-president, and two or three auditors as its executives.
(2) The executives shall be elected by the general meeting as provided
for by the articles of association (a by-election to fill a vacancy of an
11
executive shall be conducted as separately provided for in the articles
of association): Provided, That at least two-thirds of the executives including the union president shall be the members of the union.
<Amended
by Act No. 6957, Jul. 30, 2003>
(3) Any candidate who runs for an election for the union president or vice-president and successfully acquires
the greatest number of votes from a majority of the electors shall be elected to take the office, while candidates
whoever acquire a greater number of votes from a majority of the electors than others, shall be elected to
take relevant executive offices except the union president and vice-president. In such cases, the proviso of Article
25 (1) shall apply mutatis mutandis.
(4) The union president shall have overall control over the business affairs of the union, and shall represent the union.
(5) If the union president is unable to perform his/her duties because of an inevitable cause or reason, the
vice-president or one of directors
in the order enumerated in the articles of associations hall act on behalf of the president.
(6) The offices of executives shall be honorary, but they may be entitled
to the reimbursement for actual expenses as provided for by the articles of association: Provided, that the office of union president shall be the standing position as prescribed by Presidential Decree considering
the
size of total assets, etc., and his/her remuneration shall be decided by the general meeting in accordance with the
guidelines established by the National Federation Chairperson. <Amended by Act No. 6256, Jan. 28, 2000>
Article 27-2 (Restriction on Election Campaign for Executives)
No one shall commit any of the following conducts with intent to make
him/herself or a certain person win or lose in an election for an executive of a union:
1. Offering, expressing intent to offer, or promising to offer, money, goods, entertainment, any benefit in property, or
a job, private or public, to an elector;
2. Committing any conduct set forth in subparagraph 1 toward a person who is willing to come forward as a candidate
or has already come forward as a candidate with intent to prevent him/her from coming
forward as candidate or pressing him/her to resign from the candidacy;
or
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3. Accepting any benefit or job set forth in subparagraph 1 or 2, or accepting
an offer for such benefit or job.
[Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 28 (Restriction on Qualification for Executives, etc.)
(1) Any person who falls under any of the following subparagraphs shall
not be qualified for an executive or a promoter of a union: <Amended by
Act No. 5739, Feb. 1, 1999, Act No. 6256, Jan. 28, 2000; Act No. 6957, Jul. 30, 2003>
1. Any minor, incompetent or quasi-incompetent person, or a person declared bankrupt and not reinstated yet;
2. Any person in whose case three years have not passed since his/her imprisonment without labor or a heavier punishment
sentenced by a court was completely executed (including a case where it is deemed
that such sentence has been completely executed), or exempted from being executed;
3. Any person who is under the suspension of the execution of a punishment
already sentenced;
4. Any person who is under the suspension of the sentence of imprisonment without labor or a heavier punishment;
4-2. Any person in whose case five years have not passed since a sentence of a fine or a heavier punishment imposed upon
him/her because of his/her violation of this Act, or any finance-related statute as prescribed
by Presidential Decree (hereinafter referred to as “finance-related statute” for the purpose of this Act)
was completely executed (including a case where it is deemed that such sentence has been completely
executed) or was exempted from the execution;
5. Any person who forfeits his/her qualification or whose qualification is suspended by court judgment or operation of
any other Act;
6. Deleted; <By Act No. 6256, Jan. 28, 2000>
7. Any person who was removed from his office or was subjected to the disciplinary dismissal by operation of any
finance-related statute
(including a case where he/she was subjected to the disposition of re-election of an executive under the provision
of Article 84 (1) 1; the same shall apply hereinafter) and in whose case five years have
not passed since such disposition or disciplinary dismissal;
7-2. Any person who has served as an executive or an employee of a legal entity or a corporation whose permission,
authorization or
13
registration for business was revoked under any finance-related statute
(applicable only to a person directly liable or substantially responsible for the occurrence of the cause or event for the
revocation, as prescribed
by Presidential Decree) and in whose case five years have not passed since such revocation for the legal entity or the corporation;
7-3. Any person to whom a disciplinary measure of suspension from office,
suspension of performance of service, or any heavier discipline as prescribed by Presidential Decree under this
Act or any finance-related statute and in whose case the period of time prescribed by Presidential
Decree has not passed yet; or
8. Any person who falls under any other ground for restriction on qualification as provided for by the articles of
association.
(2) An executive shall be discharged immediately once a ground or event set forth in paragraph (1) (excluding subparagraph
7-3) is discovered or occurs. <Amended by Act No. 6957, Jul. 30, 2003>
(3) An act of the union in which an executive discharged under the provision of paragraph (2) was involved shall not become invalid
or ineffective.
Article 29 Deleted <by Act No. 5739, Feb. 1, 1999>
Article 30 (Executive Officers)
(1) A union may have a general manager or a manager as an executive
officer.
(2) The criteria for unions that may have a general manager or a manager as an executive officer and the guidelines for
the appointment and dismissal
of such an executive officer shall be prescribed by the National Federation
Chairperson.
(3) A general manager or a manager shall carry out the financial and accounting affairs of the union, and shall be responsible
for the preservation of evidencing documents relating to finance and accounting, and the
receipts, disbursements and safekeeping of cash.
(4) A general manager or a manager shall be appointed and discharged by the union president subject to resolution of
the board of directors from
among the persons who have qualification acceptable to the National
Federation Chairperson.
(5) The provisions of Article 11 (1) and (3), and Articles 12, 13, and
17 of the Commercial Act and Article 149 and Article 179 through 181 of the Non-Contentious Case Procedure Act shall apply mutatis mutandis
14
to the general managers and the managers.
Article 30-2 (Prohibition of Bribery, etc.)
No executive or employee of a union may demand, receive, or promise
a gift or any bribery regardless of whether it is directly or indirectly related to his/her job.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 31 (Term of Office, etc.)
(1) Each executive shall have the term of four years, but may be elected
for consecutive terms: Provided, That the unit president may be re-elected consecutively only for one more term. <Amended by Act No. 6957, Jul. 30, 2003>
(2) The term of an executive elected at a by-election shall be the remaining term of his/her predecessor.
(3) Notwithstanding the provision of paragraph (1), the term of executives
at the time of the establishment shall be prescribed by the articles of association within the period of time not
exceeding four years. <Amended by Act No. 6957, Jul. 30, 2003>
Article 32 (Sanction against an Executive for Failure in Performance of
Obligations)
The board of directors may suspend an executive from his/her execution
of office, if the executive fails to perform his obligation to the union within three months.
Article 33 (Executives’ Liability, etc.)
(1) Each executive shall abide by this Act, an order issued under this
Act, the articles of association, the regulations, and the resolutions of the general meeting and the board of directors,
and shall perform his/her
duties in good faith.
(2) Each executive shall be jointly liable for the damages inflicted upon the union or a third party by his/her intentional
or grossly negligent act
(an intentional or negligent act in case of a standing executive) in the course of performing his/her duty. <Amended by Act No. 6256, Jan. 28, 2000>
(3) Paragraph (2) shall also apply, where an executive inflicts damages
upon the union or a third party by falsity or misrepresentation in his/her report on the settlement of accounts, the registration,
or public notice.
(4) If the board of directors inflicts damages upon the union or a third
party by its intentional act or gross negligence, the executives who attended the directors’ meeting relevant to the intentional
act or gross negligence
15
shall be jointly liable for the damages: Provided, That the foregoing shall
not be applicable to the executives who expressed dissent at the meeting.
(5) The provisions of Article 35 of the Civil Act, Articles 382 (2), 386 (1), and 414 of the Commercial Act shall apply mutatis mutandis to the
executives of the unions.
Article 34 (Board of Directors)
(1) A union shall have the board of directors consisting of directors.
(2) The unit president shall take the chair of the directors’ meeting.
(3) A director may not participate in the proceedings of the directors’
meeting for the issue in which there is a conflict between the union’s interest and his/her personal interest.
(4) The board of directors shall oversee the business affairs executed by the unit president and the executive officer
in connection with the matters
resolved under the provision of Article 36 (1), and may demand them to report necessary matters to the board of directors.
<Newly Inserted by Act No. 6957, Jul. 30, 2003>
Article 35 (Call for Directors’ Meetings)
(1) The directors’ meeting shall be called by the unit president as prescribed
by the articles of association.
(2) The unit president shall, upon the request by two or more directors or auditors, call the directors’ meeting
without delay. <Amended by Act No.
6957, Jul. 30, 2003>
Article 36 (Matters subject to Resolution of Directors’ Meetings)
(1) The following matters shall be subject to the resolution of directors’
meeting:
1. Establishment, amendment, or repeal of a regulation;
2. Acquisition and disposition of fundamental assets;
3. Decision-making on the basic direction for the execution of business;
4. Borrowing of fund as required (or maximum limit in case of borrowing a loan from the National Federation);
5. Disposition of reserves;
6. Matters to be brought up before the general meeting; and
7. Important matters not under the control of the general meeting.
(2) The directors’ meeting shall be duly formed to open with the presence of a majority of directors, and shall adopt
a resolution with the affirmative vote of a majority of the directors present at the meeting.
16
(3) The method of management of and call for the directors’ meeting, etc.
shall be provided for by the articles of association.
Article 37 (Auditors’ Duties)
(1) The auditor shall audit the business, the status of assets, accounting
books and documents of the union at least once every quarter of a year after notifying the auditing in advance,
and shall submit the auditor’s quarterly report to the board of directors, and the annual report prepared
by integrating the quarterly reports to the general meeting respectively.
(2) The auditor shall verify the deposit passbooks and other instruments of substantial number of members with the
accounting books or records
of the union at least once every quarter of a year without giving an advance notice. <Amended by Act No. 6957, Jul. 30, 2003>
(3) The notification of the auditing and the submission of the auditor’s
report under paragraph (1) shall be done jointly by two or more auditors: Provided, That each auditor may submit his/her own opinion if the auditors differ in opinion.
(4) The provisions of Articles 391-2, 402, 412-2, 413, and 413-2 of the Commercial Act shall apply mutatis mutandis to the auditors’ duties. <Newly Inserted by Act No. 6957, Jul. 30, 2003>
Article 38 (Auditor’s Power to Represent)
An auditor shall represent the union in conducting an legal act such as
litigation, contracting, and the like arising in connection with the unit president.
SECTION 4 BUSINESS
Article 39 (Types of Business, etc.)
(1) A union shall engage in the following business activities in order to
accomplish its purpose: <Amended by Act No. 5739, Feb. 1, 1999; Act No. 8145, Dec.
30, 2006>
1. Credit service:
(a) Receiving and disbursing deposits and installment savings to and from its members;
(b) Lending loans to its members; (c) Domestic exchange;
(d) Providing service commissioned by the State, a public organization,
17
the National Federation or a financial institution;
(e) Safekeeping securities, precious metals, and valuable goods for its members;
(f) Discount of notes;
(g) Issuance and management of electronic means for debit payment and the settlement of such payments as prescribed by
the Electronic
Banking Act (in such cases, the foregoing shall apply only to the unions that jointly engage in the business of the
National Federation under the provision of Article 78 (1) 5 (g)); and
(h) Issuance, management, and sale of electronic means for advance payment and the settlement of such payments
as prescribed by the Electronic Banking Act (in such cases, the foregoing shall apply
only to the unions that jointly engage in the business of the National
Federation under the provision of Article 78 (1) 5 (h));
2. Welfare service;
3. Mutual aid service for its members;
4. Educational activities for enhancing economic and social status of its members;
5. Business activities commissioned by the National Federation;
6. Business activities commissioned by the State or a public organization, and business activities prescribed by other
statutes as the business
activities of the union; and
7. Business activities incidental to the business activities set forth in subparagraph 1 through 6.
(2) Necessary matters concerning the scope of welfare service under paragraph (1) 2 and the implementation of
such service shall be prescribed by Presidential Decree.
(3) The Financial Services Commission may publicly notify the work process for the deposits, installment savings, or loans
in connection with the credit service provided by unions under the provision of paragraph (1) 1. <Newly
Inserted by Act No. 5739, Feb. 1, 1999; Act No. 8863, Feb. 29, 2008>
Article 40 (Non-members’ Use of Services)
(1) A union may allow non-members to use its services under the provision
of Article 39 (1) within the extent not interfering with its members’ use, as prescribed by Presidential Decree.
In such cases, the term “member”
shall be construed as “non-member.” <Amended by Act No. 5739, Feb. 1, 1999; Act
18
No. 6957, Jul. 30, 2003>
(2) Any person who belongs to one and the same household together with a union member, another union, or a member of another union shall be deemed to be a member of the union, when such a person or another union uses the service under the provision of paragraph (1). <Amended by
Act No. 5739, Feb. 1, 1999>
Article 41 (Borrowing of Loans)
(1) A union may borrow the fund within the limit of the amount equivalent
to five percent of its total assets or the amount of its equity capital, whichever is greater, for executing its business
activities under the provisions of
Article 39, as prescribed by Presidential Decree.
(2) Notwithstanding the provision of paragraph (1), a union may borrow the fund exceeding the limit of the amount equivalent
to five percent of
its total assets or the amount of its equity capital, whichever is greater, if it obtains an approval of the
National Federation Chairperson in accordance with the guidelines prescribed by the Financial Services
Commission. <Amended by Act No. 8863, Feb. 29, 2008>
[This Article Wholly Amended by Act No. 6957, Jul. 30, 2003>
Article 42 (Limit of Loans, etc. per Person)
A union shall not grant one person a loan, etc. exceeding the limit prescribed
by Presidential Decree within the limit of the amount equivalent to twenty percent of its equity capital or one percent
of its total assets, whichever
is greater, except as approved otherwise by the National Federation Chairperson in accordance with the guidelines
prescribed by the Financial Services Commission. In such cases, all loans, etc. granted in the name
of other person but on a principal’s account shall be deemed to be the loans, etc. granted to the principal. <Amended by Act No. 6256, Jan. 28, 2000; Act
No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
Article 43 (Reserve for Repayment)
(1) A union shall, as the reserve for repayment, keep at least ten percent
of the balance of deposits and installment savings as of the end of the preceding month as prescribed by Presidential
Decree, and shall deposit
part of the reserve for repayment with the National Federation in accordance with the rate and method prescribed by Presidential
Decree. <Amended by
Act No. 5739, Feb. 1, 1999; Act No. 6256, Jan. 28, 2000>
(2) Necessary matters concerning the management of the reserve for
19
repayment deposited with the National Federation under the provision
of paragraph (1) and the disposition of gains from the management thereof shall be prescribed by Presidential Decree. <Amended by Act No. 5739, Feb. 1,
1999; Act No. 6256, Jan. 28, 2000; Act No. 6957, Jul. 30, 2003>
Article 44 (Investment and Management of Spare Cash)
A union shall invest and manage its spare cash in one of the following
manners: <Amended by Act No. 5739, Feb. 1, 1999; Act No. 6256, Jan. 28, 2000; Act No. 6957, Jul. 30, 2003>
1. Deposit with the National Federation;
2. Deposit with a financial institution specified by Presidential Decree;
or
3. Purchase of national bonds, public bonds, or securities of the types and within the limit specified by Presidential
Decree.
Article 45 (Limit to Possession of Real Property)
(1) A union may not own real property, except as necessary for its business
or inevitable for the recovery of its claims. <Amended by Act No. 5739, Feb. 1,
1999>
(2) Deleted. <by Act No. 5739, Feb. 1, 1999>
SECTION 5 ACCOUNTING
Article 46 (Fiscal Year)
The fiscal year of a union shall be prescribed by its Articles of Association.
Article 47 (Accounting and Settlement of Accounts)
(1) The accounts of a union shall be classified into general accounts and
special accounts, and the business divisions by accounts shall be prescribed by the articles of association.
(2) Necessary matters concerning the accounting principles and the
settlement of accounts for a union shall be prescribed by the Financial Services Commission: Provided, That the detailed matters including the titles of account and the forms of accounting books may be prescribed
separately by the National Federation Chairperson. <Amended by Act No. 6957,
Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
(3) Deleted. <by Act No. 5739, Feb. 1, 1999>
(4) A union shall submit to the National Federation Chairperson the report on the settlement of accounts as of the end
of each fiscal year within
thirty days after it obtains an approval of the general meeting.
20
(5) A union whose total assets as of the end of the preceding year reach
or exceed the reference amount prescribed by Presidential Decree shall undergo the audit every year by an auditor
as defined by the provision
of Article 3 of the Act on External Audit of Stock Companies, if the Financial Services Commission concludes it necessary to
conduct an independent audit for the protection of the members of the union and thus request
an independent auditor to conduct such an audit: Provided, That the foregoing shall not apply to the union, if it has already undergone the audit conducted by the Financial
Services Commission for the corresponding
year. <Amended by Act No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
(6) The National Federation Chairperson may demand a union to replace its auditor with a person nominated by the
Chairperson or appoint such
a person as its auditor, if the union subject to the audit under the provision of paragraph (5) falls under any of the grounds
prescribed by Presidential Decree. <Newly Inserted by Act No. 6957, Jul. 30, 2003>
(7) The provisions of the first sentence of Article 4 (1), (4) and (5) of the Act on External Audit of Stock Companies,
and Articles 4-4 and 4-5, Article 5 (1), Articles 6, 7, 8 (1), 9 through 11, 14, 15-2, 16-2, and 17
through 17-4 of the same Act shall apply mutatis mutandis to unions and auditors. In such cases, the “Securities and Futures Commission” pursuant to Articles 4-4, 4-5,
8 (1), 14, 15-2 and 16-2 of the same Act
shall be construed as the “Governor of Financial Supervisory Service,”
and the “general meeting of shareholders” pursuant to Articles 10 and
11 of the same Act as the “general meeting.” <Newly Inserted by Act No. 6957, Jul. 30, 2003>
Article 48 (Business Plan and Budget)
(1) A union shall prepare its business plan and budget (including
compilation of a supplementary revised budget) every year in compliance with the guidelines for the business plan and
budget compilation established
by the National Federation Chairperson, and shall obtain an approval of the general meeting: Provided, That the foregoing shall not apply to
the revision of the business plan and budget due to an inevitable reason or cause such as an increase in interest expense.
(2) Deleted. <by Act No. 5739, Feb. 1, 1999>
Article 49 (Legal Reserve)
(1) A union shall set aside for legal reserve at least ten percent of its
21
income every fiscal year until the amount reaches twice as much as its
total paid capital. <Amended by Act No. 6957, Jul. 30, 2003>
(2) A union shall not use the reserve under the provision of paragraph
(1) or appropriate it for dividends except where the union becomes split off or dissolved.
Article 50 (Voluntary Reserve)
A union may set aside a portion of its income for business reserve every
fiscal year.
Article 51 (Special Reserve)
A union may accumulate some amount every fiscal year as a special reserve
in order to set off its deficit and appropriate it for the loss and damages sustained due to a theft, robbery, fire,
and any other disaster or accident
beyond its control, as provided for by its articles of association.
Article 52 (Disposition of Loss)
(1) The loss incurred to a union during a fiscal year shall be set off with
the unappropriated retained earnings, special reserve, and voluntary reserve in the enumerated order, while
the still remaining loss, if any, shall be carried forward to the following fiscal year.
(2) If a union ends up with a loss for several years consecutively and there is no reserve for setting off such losses
with, the union may reduce its capital with the affirmative vote of at least two-thirds of its members
present at the general meeting and then with an approval of the National Federation Chairperson to the effect that
the paid capital invested by each member shall decrease proportionately.
Article 53 (Disposition of Income)
(1) A union may not dispose of its income unless and until it sets off
its loss completely.
(2) The income left over after setting off with the reserves under the provisions of Article 49 through 51 shall
be distributed to members in
proportion of the shares in the paid capital held by each member with a resolution of the general meeting. In such
cases, the dividends may
be distributed simultaneously with the dividends proportionate to each member’s performance of use of the services
of the union, as provided for by the articles of association.
SECTION 6 DISSOLUTION, SPLIT-OFF, AND
22
MERGER
Article 54 (Dissolution)
(1) A union shall be dissolved if any of the following events or causes
occurs:
1. If a cause for dissolution prescribed by the articles of association occurs;
2. If the general meeting resolves to dissolve the union;
3. If it is merged or bankrupt; or
4. If the authorization for its establishment is revoked.
(2) When dissolution is resolved by the general meeting under the provision of paragraph (1) 2, it shall be reported to the
National Federation without
delay.
(3) A union dissolved under the provision of paragraph (1) shall file for the registration of dissolution within
fourteen days: Provided, That the
surviving union shall file for the registration of change, in case where a union is merged into another union.
Article 55 (Merger and Split-Off)
(1) A union may be merged or split off by a resolution of the general
meeting. In such cases, the provisions of Article 7 through 10 and the proviso of Article 25 (1) shall apply mutatis mutandis.
(2) The Government or the National Federation may provide a financial aid, etc. within the limit of its budget,
if considered necessary to promote a merger of unions.
(3) The surviving union or the newly established union as a consequence of a merger or split-off shall succeed to the
common bond, rights and obligations of the union disappearing subsequent to the merger or split-off.
SECTION 7 LIQUIDATION
Article 56 (Supervision over Liquidation Affairs)
The affairs relating to the liquidation of a union shall be supervised by
the National Federation Chairperson.
Article 57 (Liquidator)
(1) The union president shall become the liquidator in the dissolution
of the union, except for bankruptcy: Provided, That the foregoing shall not apply, where the National Federation Chairperson appoints other liquidator in
accordance with the provisions of Presidential Decree.
23
(2) The liquidator shall register the ground for dissolution, the date of
dissolution, the name and address of the liquidator, and the restrictions on the liquidators’ power to represent, if
any, with the competent authorities
having jurisdiction over the union’s principal place of business and its branch offices respectively. The foregoing
shall also apply to a change, if any, in the registered records.
Article 58 (Residual Property after Dissolution)
The residual property left over after liquidation, if any, after fully
performing the obligations of the dissolved union shall be disposed of in accordance with the provisions of the articles
of association.
Article 59 (Liquidator’s Duties, etc.)
(1) The liquidator shall inspect the status of the assets owned by the
union immediately upon his/her inauguration, and shall prepare a list of assets and the balance sheet for approval
of the general meeting. the
foregoing shall apply to the report on the settlement of accounts required at the time when the affairs relating to the liquidation
are completed.
(2) If the general meeting is not duly formed for the approval under
paragraph (1) even after calling the general meeting twice or more, the approval of the National Federation Chairperson
shall be deemed to substitute the approval of the general meeting.
(3) The liquidator shall not distribute the union’s assets unless and until the union’s obligations are fully performed
or assets sufficient for such performance are duly deposited.
(4) The liquidator shall, upon the closing of the liquidation affairs, register it with the competent authority having jurisdiction
over the place of business immediately, and shall report it to the National Federation Chairperson
in detail.
Article 60 (Application Mutatis Mutandis of the Civil Act, etc.)
The provisions of Article 79, 81, 87, 88 (1) and (2), 89 through 92, and
93 (1) and (2) of the Civil Act and the provision of Article 121 of the
Non-Contentious Case Procedure Act shall apply mutatis mutandis to the liquidation of a union.
CHAPTER III NATIONAL FEDERATION
SECTION 1 ESTABLISHMENT AND CAPITAL
24
Article 61 (Establishment)
(1) The National Federation composed of unions shall be established to
guide and oversee the business of the unions and promote the enhancement of their common interest and the healthy growth.
(2) The provisions of Articles 7 and 8 shall apply mutatis mutandis to the National Federation.
Article 62 (Membership)
All unions shall become members of the National Federation.
Article 63 (Capital and Investment)
(1) The National Federation shall be capitalized by the investments paid
by the unions.
(2) Each union shall invest in at least one share of the capital.
(3) The value per share and the guidelines for the payment shall be prescribed by the articles of association,
and the liability of each union shall be limited to the amount of the investment paid by it.
(4) The investment in the National Federation by a union shall be paid in cash, and shall not set off against
any of the union’s claims against the National Federation.
(5) A union’s shares invested in the National Federation may be transferred to another union with an approval of the National
Federation Chairperson. In such cases, the transferee shall succeed to the rights and obligations
of the transferor.
(6) In case where a union is dissolved, the National Federation Chairperson shall refund its investment to reduce the capital
by the amount equivalent
to the share invested by the union or may allow the dissolving union to transfer its share to another union.
Article 64 (Entries in the Articles of Association)
The articles of association of the National Federation shall contain the
following descriptions:
1. Purpose;
2. Name;
3. Address of its principal place of business;
4. Matters concerning the details of its business and accounting;
5. Value per share of the capital and the method and time for the payment for the shares;
6. Matters concerning imposition and collection of membership fee;
25
7. Matters concerning its organs and executives;
8. Method of public notice; and
9. Other necessary matters.
Article 65 (Business Districts, Offices, etc.)
(1) The National Federation composed of credit unions shall be only one
throughout the country, and it shall cover the whole territory of the Republic of Korea as its business district.
(2) The National Federation shall have its principal office as prescribed by the articles of association, and may have
regional offices as necessary.
(3) A regional office under the provision of paragraph (2) may establish
and run a council in order to exchange information for the development of the unions and give assistance to the unions
for the efficient management of their business affairs.
(4) The matters concerning the organization and management of the council under the provision of paragraph (3) and other
necessary matters shall be provided for by the articles of association.
Article 66 (Membership Fees)
The National Federation may charge and receive membership fees from
unions by a resolution of the general meeting.
Article 67 (Dissolution)
The matters concerning the dissolution of the National Federation shall
be prescribed by an Act.
SECTION 2 ORGANS
Article 68 (General Meeting)
(1) The National Federation shall have the general meeting.
(2) The general meeting shall be composed of the National Federation
Chairperson and the representatives from the unions, and shall be classified into an annual general meeting and a special general
meeting.
(3) The annual general meeting shall be called by the National Federation
Chairperson once every year, while a special meeting shall be called when the National Federation Chairperson considers
it necessary or at the request of the representative of the unions under the provision of Article
26, which shall apply mutatis mutandis under paragraph (4), as prescribed by the articles of association, and the National Federation Chairperson
26
shall take the chair of the meeting.
(4) The provisions of the main sentence of Article 19 (1), the main sentence of Article 25 (1), and Article 26 (1) through (5)
shall apply mutatis mutandis
to the general meeting of the National Federation. In such cases, the term “auditor” in Article 26 shall
be construed as the “representative of the Audit Committee under the provision of Article 76 (3).” <Amended by
Act No. 6957, Jul. 30, 2003>
Article 69 (Matters subject to Resolution of General Meeting)
(1) The following matters shall be subject to resolution of the general
meeting, except as provided for otherwise in this Act: <Amended by Act No.
6256, Jan. 28, 2000>
1. Amendment of the articles of association;
2. Establishment, amendment, and repeal of the bylaws;
3. Method for imposing membership fee and determining the amount;
4. Approval of the business plan, budget, and the report on the settlement of accounts;
5. Approval of auditor’s report;
6. Matters concerning appointment and removal of executives; and
7. Other matters brought up by a resolution of the board of directors or the consent of at least one-fifths of all unions.
(2) An amendment to the articles of association under the provision of paragraph (1) 1 shall be registered immediately
after obtaining an approval
of the Financial Services Commission. <Amended by Act No. 8863, Feb. 29, 2008>
Article 70 (Representatives’ Meeting)
(1) The National Federation shall have the representatives’ meeting, which may substitute the general meeting.
(2) The matters subject to resolution of the general meeting may be resolved by the representatives’ meeting. In such cases,
such a resolution shall
be deemed to substitute the resolution of the general meeting.
(3) The representatives meeting shall be composed of the National
Federation Chairperson and representatives.
(4) The fixed number of the representatives shall be no more than two hundred persons, and they shall be elected from
among the representatives from unions as prescribed by the articles of association.
(5) The term of representatives shall be four years, and the term of a representative elected by a by-election
shall be the remaining term of
27
his/her predecessor.
(6) The provisions concerning the general meeting shall apply mutatis mutandis to the representatives’ meeting, but the rights to vote and elect
may not be exercised by proxy.
Article 71 (Fixed Number of Executives)
(1) The National Federation shall have no less than 15, but no more than
25 directors as executives including one Chairperson, one President for credit and mutual aid services, and Director
for inspection and supervision.
(2) The Chairperson, the President for credit and mutual aid services, and the Director for inspection and supervision
among directors shall be
standing executives.
(3) The executives other than the standing executives under the provision of paragraph (2) shall be non-standing,
but may be entitled to
reimbursement for actual expenses as prescribed by the articles of association.
[This Article Wholly Amended by Act No. 6957, Jul. 30, 2003]
Article 71-2 (Appointment of Executives and Requirements for
Qualification)
(1) The executives shall be elected at the general meeting as prescribed
by the articles of association, and at least one-thirds of the executives including the President for credit and mutual
aid services and the Director
for inspection and supervision shall be elected from among the people who are not an executive or a senior officer
of a union.
(2) The National Federation Chairperson shall be a member of a union.
(3) The President for credit and mutual aid service, the Director for inspection and supervision, and the directors
who are not executives or
senior officers of unions (hereinafter referred to as “professional directors”) shall be elected from among persons who have
good expertise and experience in the area of finance and meet the requirements prescribed by Presidential
Decree.
(4) A union president shall, if elected to the National Federation
Chairperson, shall resign from his/her current office before inauguration.
(5) The matters concerning the method of election of executives, etc. shall be prescribed by the articles of association, if
there is no relevant provision in this Act.
(6) The provision of Article 28 shall apply mutatis mutandis to the
28
executives of the National Federation.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 72 (Executives’ Duties, Terms, etc.)
(1) The National Federation Chairperson shall represent the National
Federation, and shall have overall control over the affairs of the National
Federation: Provided, That the foregoing shall not apply to the affairs under the exclusive control of the President for credit
and mutual aid
services under the provision of paragraph (2).
(2) The President for credit and mutual aid services shall carry out the following affairs with an exclusive control
over them, and shall represent
the National Federation in carrying out such affairs:
1. The business activities specified in Article 78 (1) 5 and 6 and the business activities relating to the credit
and mutual aid services and
the business activities incidental to such services among those specified in subparagraph 7 through 9 of said paragraph; and
2. The establishment of business goals, the business plan, and the financing plan for the assigned business affairs
under subparagraph
1.
(3) The President for credit and mutual aid services shall perform his/her duties relating to the business affairs assigned
to him/her earnestly in good faith as a professional business-person, and shall report to the board
of directors and the general meeting the results of the evaluation on the business performance conducted as prescribed by
the articles of association.
(4) The Director for inspection and supervision shall exclusively carry
out the affairs relating to inspection and supervision over the unions under the provision of Article 78 (1) 3, while
the National Federation Chairperson shall take appropriate measures such as delegation of authorities so that
the Director for inspection and supervision can carry out the assigned affairs independently.
(5) The National Federation Chairperson may demand the general meeting
to remove the President for credit and mutual aid services, if it is found that the President for credit and mutual
aid services has a difficulty in performing his/her duties because of the poor business performance
revealed as a result of the evaluation on the business performance under the provision of paragraph (3), or commits an
act in violation of this Act, an order issued under this Act, or any provision of the articles of association
29
or a regulation.
(6) If the National Federation Chairperson is unable to perform his/her duty due to an inevitable reason or cause,
one of executives shall act
on his/her behalf according to the order prescribed in the articles of association.
(7) The provisions of Article 27-2, 31 (1) and (2), and 33 shall apply
mutatis mutandis to the executives of the National Federation. In such cases, the term “unit president” in Article 31 (1) shall be construed as the “National Federation Chairperson.”
Article 73 (Employees)
(1) Employees shall be appointed and discharged by the National
Federation Chairperson: Provided, That the employees who engage in the business affairs assigned to the President of credit and mutual aid services
under the provision of Article 72 (2) shall be appointed and discharged by the National Federation Chairperson subject
to consultation with the President for credit and mutual aid services. <Amended by Act No. 6957, Jul.
30, 2003>
(2) Deleted. <Amended by Act No. 6957, Jul. 30, 2003>
Article 74 (Board of Directors)
(1) The National Federation shall have the board of directors.
(2) The directors’ meeting formed with directors shall be convened by the National Federation Chairperson as
prescribed by the articles of association, and the National Federation Chairperson shall take the chair
of the meeting.
(3) The National Federation Chairperson shall, upon the request of five or more directors, convene the directors’
meeting without delay. <Amended
by Act No. 6957, Jul. 30, 2003>
(4) The National Federation may have a committee composed of three or more directors within the board of directors for deliberation on a specialized business such as credit service as prescribed by the articles of association. <Amended by Act No. 6957, Jul. 30, 2003>
Article 75 (Matters subject to Resolution of the Board of Directors)
(1) The following matters shall be subject to resolution of the board of
directors: <Amended by Act No. 6256, Jan. 28, 2000>
1. Establishment, amendment, and repeal of the standard articles of association for unions;
30
2. Establishment, amendment, and repeal of the standard regulations
for unions;
3. Establishment, amendment, and repeal of regulations;
4. Deleted; <Amended by Act No. 6957, Jul. 30, 2003>
5. Acquisition and disposition of fundamental assets;
6. Maximum limit of borrowed loans;
7. Matters delegated by the general meeting and matters to be brought up before the general meeting;
7-2. Matters considered necessary by the National Federation
Chairperson or at least one-third of directors; and
8. Important matters other than those within the authority of the general meeting under any provision of a statute or the
articles of association.
(2) The Financial Services Commission may demand the board of directors to revise the standard articles of association or
the standard regulations, if it finds that any provision of the standard articles of association or
the standard regulations is unlawful or might hinder the sound management of unions. In such cases, the board of directors
shall respond accordingly to such a demand. <Amended by Act No. 8863, Feb. 29, 2008>
(3) The provisions of Article 34 (3) and Article 36 (2) and (3) shall apply
mutatis mutandis to the National Federation.
(4) The board of directors shall supervise the business affairs executed by the standing executives in connection
with the matters resolved under
the provision of paragraph (1), and may demand them to report necessary matters to the board of directors. <Amended by Act No. 6957, Jul. 30, 2003>
Article 76 (Audit Committee)
(1) The National Federation shall establish a committee within the board
of directors for auditing the business performance, accounting, etc. of the
National Federation (hereinafter referred to as the “Audit Committee”).
(2) The Audit Committee shall be composed of three or more directors, while at least two-thirds of all committee
members shall be comprised of professional directors.
(3) The Audit Committee shall, by a resolution, select a person who shall represent the committee.
(4) If the composition of the Audit Committee fails to conform to the
requirements under the provision of paragraph (2) due to resignation or death of a member, or any other reason, the
general meeting convened
31
first after occurrence such an event or cause shall take a measure to make
the composition of the Audit Committee to conform to the requirements under the provision of paragraph (2).
[This Article Wholly Amended by Act No. 6957, Jul. 30, 2003]
Article 76-2 (Audit Committee’s Mission, etc.)
(1) The Audit Committee shall audit the business affairs, the status of
assets, accounting books and documents of the National Federation at least once every quarter of a year after giving
a notice of the audit, and shall submit a quarterly audit report to the board of directors and an
annual audit report, in which the quarterly reports are integrated, to the annual general meeting or the annual representatives’
meeting.
(2) The provisions of Article 26 (2) through (5) and Article 38 of this
Act and Articles 391-2 (2), 402, 412, 412-2, 413, 413-2, 414, 447-3,
447-4 and 450 of the Commercial Act shall apply mutatis mutandis to the Audit Committee. In such cases, the term “auditor” in Article 26 (2)
through (5) shall be construed as the “representative of the Audit Committee,” the term “auditor”
in Article 413-2, 414, and 450 of the Commercial Act” as the “member of the Audit Committee,” and the term
“auditor” in other provisions as the “Audit Committee” respectively.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
[The previous Article 76-2 Moved to Article 76-4 <by Act No. 6957, Jul. 30, 2003>]
Article 76-3 (Guidelines for Internal Control, etc.)
(1) The National Federation shall comply with statutes, and shall establish
basic procedures and guidelines with which its executives and employees shall comply in performing their duties
(hereinafter referred to as “guidelines for internal control”).
(2) The National Federation shall have one compliance officer responsible for monitoring whether the guidelines
for internal control are complied with, conducting an investigation of a violation of the guidelines for internal
control, if such a violation occurs, and then reporting the results of his/her investigation to the Audit Committee
(hereinafter referred to as the “compliance officer”).
(3) The appointment and discharge of the compliance officer by the National Federation Chairperson shall be subject to
resolution of the board of directors.
(4) The compliance officer shall meet the following requirements for
32
qualification: <Amended by Act No. 8852, Feb. 29, 2008; Act No. 8863, Feb. 29, 2008>
1. He/she shall be a person who has any of the following career experience: (a) Any person who has a career of at least ten years
working for the
Bank of Korea or an institution subject to the audit under Article
38 of the Act on the Establishment, etc. of Financial Services
Commission (including a foreign financial institution equivalent to such an institution);
(b) Any person who holds a master’s degree in finance-related area and has a career of at least five years as
a researcher, full-time
lector or higher at a research institute, university or college;
(c) Any person who is licensed as a lawyer or certified public accountant and has career experience of engaging in a business
relating to
such license at least five years; or
(d) Any person who has career experience of working for the Ministry of Strategy and Finance, the Financial Services
Commission or the
Financial Supervisory Service at least five years and in whose case five years have passed since his/her retirement or
resignation from the agency or institution;
2. Any person who does not fall under any subparagraph of Article 28 (1); and
3. There shall be no record that he/she has ever been subject to a measure
corresponding to a demand for caution or warning from the Financial Services Commission or the Governor of the
Financial Supervisory Service due to a violation of a finance-related statute during the latest
five years.
(5) Necessary matters concerning guidelines for internal control and the compliance officer shall be prescribed by Presidential
Decree.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 76-4 (Appointment of Representative)
The National Federation Chairperson and the President for credit and
mutual aid services may appoint a representative who shall have an authority to do all acts on behalf of them
within or without a trial in connection with the business affairs of the National Federation from among
the Director for inspection and supervision or employees, as prescribed by the articles of association. <Amended by Act No. 6957, Jul. 30, 2003>
[This Article Newly Inserted by Act No. 6204, Jan. 28, 2000]
33
Article 77 (Training Center)
(1) The National Federation may have a training center.
(2) Necessary matters concerning the establishment and organization of the training center shall be prescribed by the articles
of association.
SECTION 3 BUSINESS
Article 78 (Types of Business, etc.)
(1) The National Federation shall carry out the following business activities
in order to achieve its purpose of business: <Amended by Act No. 5739, Feb. 1,
1999; Act No. 8145, Dec. 31, 2006; Act No. 8635, Aug. 3, 2007>
1. Guidance, coordination, survey, research, and public relations relating
to the business of unions;
2. Educational programs for the union members and the executives and employees of unions;
3. Inspection and supervision over unions;
4. Supports to the business of unions;
5. Credit service:
(a) Receipt and management of deposits, installment savings, repayment reserve, etc. from unions;
(b) Lending funds to unions;
(c) Domestic and foreign exchange services for unions and their members;
(d) Vicarious execution of the business of the State, a public organization or a financial institution;
(e) Payment guarantee for unions and discount of notes for unions;
(f) Underwriting and sale of State bonds and local government bonds under Article 4 (3) of the Capital Market and Financial
Investment
Business Act;
(g) Issuance and management of electronic means for direct payment and settlement of such payments under the Electronic
Banking Act;
and
(h) Issuance, management, sale of electronic means for advance payment and settlement of such payments
under the Electronic
Banking Act;
6. Mutual aid service for unions and their members;
34
7. Business commissioned or subsidized by the State or a public
organization;
8. Business incidental to the business activities under subparagraph 1 through 7, and
9. Other businesses necessary for the achievement of its purpose.
(2) The National Federation may borrow funds for carrying on its business activities under paragraph (1). <Amended by Act No. 5739, Feb. 1, 1999>
(3) The National Federation may invest in other legal entity, if necessary for carrying on the business activities
under paragraph (1). <Amended by
Act No. 5739, Feb. 1, 1999>
(4) The union members’ use of the services shall be deemed to be the use by the unions themselves.
(5) The National Federation shall, whenever it intends to borrow a fund (excluding the cases prescribed by Presidential
Decree, considering the purpose, size, etc. of loan) or invest a fund (excluding the cases prescribed
by Presidential Decree, considering the purpose, size, etc. of investment), obtain an approval of the Financial Services
Commission in advance.
<Amended by Act No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
Article 78-2 (Use of Service by Non-Unions)
(1) The National Federation may allow persons who are not unions to
use the service under Article 78 (1) 5 (b) (applicable only to the portion of loans not lendable by a union due to
the limit of loan to one person
under the provision of Article 42) or the service under subparagraph 6 of said paragraph. In such cases, the terms
“unions” in Article 78 (1) 5
(b) and “unions and their members” shall be construed as “persons who are not unions.”
(2) The loan size, the limit of loan to one person, etc. in lending a loan
under the provision of paragraph (1) shall be prescribed by Presidential
Decree.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 79 (Investment and Management of Fund)
(1) The National Federation shall invest and manage the fund including
the deposits, installment savings, repayment reserve, etc. received from unions under the provision of Article 78
(1) 5 (a) in any of the following
manners:
1. Lending loans to unions;
35
2. Purchase of national bonds, public bonds, corporate bonds, and other
securities;
3. Deposit with a financial institution specified by Presidential Decree;
or
4. Other manners prescribed by Presidential Decree.
(2) The classes and limit of securities that the National Federation may purchase under the provision of paragraph
(1) 2 shall be prescribed by
Presidential Decree.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 80 (Establishment of Personnel Management Committee)
(1) The National Federation may have the personnel management
committee for personnel exchange, etc. between unions.
(2) The matters concerning the organization and management of the personnel management committee shall be prescribed
by the bylaws of the National Federation.
SECTION 4 CREDIT UNION DEPOSITORS PROTECTION FUND
Article 80-2 (Establishment, etc. of the Credit Union Depositors Protection
Fund)
(1) The National Federation shall establish and manage the fund for
protection of credit union depositors (hereinafter referred to as the “fund”)
at the National Federation in order to guarantee the refund of deposits and installment savings paid by union members
(including non-members
under Article 40; hereafter referred to as “union members, etc.” in this
Section), separate deposits to clear cashier’s checks of the National
Federation, etc. (hereinafter referred to as “deposits, etc.”) up to the amount prescribed by Presidential Decree and promote
the healthy growth of unions.
<Amended by Act No. 8840, Jan. 17, 2008>
(2) Any union and the National Federation shall join the fund under
paragraph (1). <Amended by Act No. 8840, Jan. 17, 2008>
(3) The National Federation shall have the fund management committee for deliberation and decision-making on important
matters concerning the management of fund.
(4) The National Federation shall pay deposits, etc. under paragraph (1)
36
in subrogation of a union or other accounts of the National Federation
as prescribed by Presidential Decree, if the union or other such accounts are unable to pay such deposits, etc. to its
members, etc. <Amended by Act
No. 8840, Jan. 17, 2008>
(5) Necessary matters concerning the organization, management, etc. of
the fund management committee under the provision of paragraph (3)
shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 80-3 (Raising, Management, etc. of Fund)
(1) The fund shall be raised from the following sources: <Amended by Act
No. 8840, Jan. 17, 2008>
1. Contributions paid by unions;
2. Funds contributed, transferred and borrowed from other accounts of the National Federation;
3. Borrowed loans as prescribed by Presidential Decree;
4. Gains accrued from management of the fund; and
5. Other revenue.
(2) Necessary matters concerning the raising and management of the fund under each subparagraph of paragraph (1)
shall be prescribed by
Presidential Decree.
(3) A union and other accounts of the National Federation may not claim the refund of the contribution paid in accordance
with the provision of
paragraph (1) 1 and 2. <Amended by Act No. 8840, Jan. 17, 2008>
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 80-4 (Acquisition of Claims, etc.)
(1) The National Federation shall, if it pays by subrogation under the
provision of Article 80-2 (4), acquire the rights held by the members, etc. of the union within the extent of the
amount paid.
(2) The National Federation may, on behalf of the members, etc. of a union, set off the claims held by such members,
etc. for deposits, installment savings, etc. (excluding the claims put as security for the members
themselves or others) against their obligations (excluding obligations of surety), as of the public notification date of
the payment.
(3) The National Federation may withhold the payment for the amount
prescribed by Presidential Decree for obligations of surety owed by the members, etc. to the union, notwithstanding the
provision of Article 80-2 (4).
37
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 80-5 (Exercise of Right to Claim Damages, etc.)
(1) The National Federation may, if it makes a payment by subrogation
under the provision of Article 80-2 (4), demand the union to claim damages against the executives and employees, former or
incumbent, of the union, who are found liable for the insolvency of the union (including its legal
entity in liquidation or bankruptcy for the purpose of this Article only), a person who falls under any of subparagraphs
of Article 401-2 (1) of the Commercial Act, or any other third party.
(2) The National Federation may claim damages in subrogation of a union immediately, if the union does not follow its
demand under the provision of paragraph (1).
(3) The National Federation may conduct an investigation into the business affairs and the status of assets of a union,
if necessary for demanding to compensate for damages and exercising by subrogation the right to
claim for damages under the provisions of paragraph (1) and (2).
(4) If a judgment is given in favor of the National Federation as a result of its exercise by subrogation of a right
to claim for damages under the
provision of paragraph (2), the union concerned shall pay all expenses incurred therefrom.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
SECTION 5 ACCOUNTING
Article 81 (Business Budget, Settlement of Accounts, etc.)
(1) The National Federation shall prepare the business plan and budget
in writing every fiscal year, and shall obtain an approval of the general meeting.
(2) The National Federation shall have the accounting audit by an auditor as defined in the provision of Article 3 of
the Act on External Audit of
Stock Companies every fiscal year.
(3) The National Federation shall submit the report on the settlement of accounts for each fiscal year, the audit
report by the Audit Committee,
and the auditor’s report by an independent auditor for approval within three months after the end of the corresponding
fiscal year.
(4) The National Federation shall submit the report on the settlement
of accounts and the auditor’s report approved under the provision of
38
paragraph (3) to the Financial Services Commission within two weeks
after the closing of its annual general meeting. <Amended by Act No. 8863, Feb.
29, 2008>
(5) The provisions of Article 46, 47 (1) and (2), 49 through 51, 52 (1),
and 53 shall apply mutatis mutandis to the National Federation.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 82 (Reduction of Invested Capital)
The National Federation may reduce the amount of its capital with a
resolution of the general meeting, if it suffers losses continuously over several fiscal years and there is no reserve
available for offset.
CHAPTER Ⅳ SUPERVISION
Article 83 (Supervision by the Financial Services Commission, etc.)
(1) The Financial Services Commission shall supervise the business affairs
of unions and the National Federation, and may issue an order necessary for supervision. <Amended by Act No. 8863, Feb. 29, 2008>
(2) The Governor of the Financial Supervisory Service may assign an employee of the agency to conduct an inspection
into the business affairs
or assets of a union or the National Federation. <Amended by Act No. 6204, Jan. 28, 2000>
(3) The Governor of the Financial Supervisory Service may demand a
union or the National Federation to submit a report or data relating to its business affairs or assets, dispatch
a person concerned to appear before the Service to state his/her opinion, if the Governor considers it necessary
for the inspection under the provision of paragraph (2). <Amended by Act
No. 6204, Jan. 28, 2000>
(4) Any person who conducts an inspection under the provision of paragraph (2) shall present a certificate showing his/her
authority to the people concerned. <Newly Inserted by Act No. 6204, Jan. 28, 2000>
(5) The union or the National Federation that undergoes the inspection of the Financial Supervisory Service shall reimburse
the expenses as alloted
for such inspection to the Financial Supervisory Service.
(6) Necessary matters concerning the rate and limit of the alloted expenses and the reimbursement for such expenses under
the provision of paragraph
(5) shall be prescribed by Presidential Decree. <Amended by Act No. 6204, Jan.
39
28, 2000>
Article 83-2 (Public Disclosure of Business Management)
Each union shall publicly disclose the important information and data
concerning its business management status as prescribed by the Financial
Services Commission. <Amended by Act No. 8863, Feb. 29, 2008>
[This Article Newly Inserted by Act No. 5739, Feb. 1, 1999]
Article 83-3 (Guidelines for Soundness in Business Management)
(1) Each union and the National Federation shall comply with the guidelines
for soundness in business management established by the Financial
Services Commission pursuant to the provisions of Presidential Decree concerning the following matters in order to maintain
soundness in their
business management and prevent a fraud or an accident in financial transactions: <Amended by Act No. 8863, Feb. 29, 2008>
1. Matters concerning soundness in financial structure;
2. Matters concerning soundness in assets;
3. Matters concerning accounting and settlement of accounts;
4. Matters concerning risk management; and
5. Other matters necessary for securing the soundness in business management.
(2) The Financial Services Commission may, if it finds that the soundness in business management of the National Federation
is likely to be severely impaired because of its failure in meeting the guidelines for soundness
in business management under the provision of paragraph (1) or any other cause, issue an order to take a measure
for improving the state of its business management by increasing its capital, reducing its assets, etc.
<Newly Inserted by Act No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008> [This Article Newly Inserted by Act No. 6204, Jan. 28, 2000]
Article 83-4 (Submission of Business Report)
(1) Each union shall submit a monthly report with the details of business
affairs in the form prescribed by the Governor of the Financial Supervisory
Service to the National Federation Chairperson by the end of next month.
(2) The report under the provision of paragraph (1) shall be signed or sealed by the representative and the officer in
charge or their deputies.
(3) The provisions of paragraphs (1) and (20 shall apply mutatis mutandis to the National Federation. In such cases, the term “National Federation Chairperson” in paragraph (1) shall be construed
as the “Governor of the
40
Financial Supervisory Service.”
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 84 (Administrative Dispositions against Executives and
Employees)
(1) The Financial Services Commission may require a union or the National
Federation to take any of the following dispositions against an executive or an employee of the union or the National
Federation who fails or omits
to follow a procedure or perform his/her duty in compliance with this Act, an order issued under this Act, the articles
of association or a regulation:
<Amended by Act No. 6204, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
1. Re-election, suspension of performance of duties, or censure, in case
of an executive;
2. Disciplinary dismissal, suspension from office, salary reduction, or censure, in case of an employee; or
3. Caution or warning, in case of an executive or an employee.
(2) An executive or an employee of a union or the National Federation shall, upon the demand for the disposition
of re-election or disciplinary dismissal of the executive or employee under the provisions of paragraph
(1) and Article 89 (7) 1, be subjected to the suspension from office for the period of time beginning on the date
when such demand is made and ending on the action is finally taken. <Newly Inserted by Act No. 6204, Jan. 28, 2000;
Act No. 6957, Jul. 30, 2003>
(3) If there is no executive who can execute the business affairs of a union or the National Federation, the Financial Services Commission may appoint an ad hoc executive. <Amended by Act No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008> (4) When an ad hoc executive is appointed under the provision of paragraph (3), the union or the National Federation shall register the appointment without delay: Provided, That the Financial Services Commission may request the register office having jurisdiction over the address of the principal place of business of the union or the National Federation to make such registration, if the union or the National Federation neglects to file for the registration. <Amended by Act No. 5739, Feb. 1, 1999; Act No. 6957, Jul.
30, 2003; Act No. 8863, Feb. 29, 2008>
Article 85 (Administrative Dispositions against Union, etc.)
(1) The Financial Services Commission may take a disposition under one
of the following subparagraphs, if it finds that the soundness in business
41
management of a union or the National Federation is likely to be impaired
because of its violation of this Act or an order issued under this Act:
<Amended by Act No. 8863, Feb. 29, 2008>
1. Caution or warning to the union or the National Federation;
2. Order for correction of such violation; or
3. Partial suspension of its business for a period of time not exceeding six months.
(2) The Financial Services Commission may order the suspension of the
entire business of a union for a period of time not exceeding six months or revoke the authorization for establishment
of a union, if the union falls under one of the following subparagraphs: <Amended by Act No. 8863, Feb.
29, 2008>
1. If it has obtained the authorization for establishment in a false or
fraudulent means;
2. If it violates or breaches a provision or a condition of the authorization;
3. If it continues its business during the period of suspension of business;
4. If it fails or omits to follow the order for correction issued under the provision of paragraph (1) 2;
5. If the number of its members fails to reach one hundred persons
continuously for one year or longer;
6. If the aggregate of capital invested in the union fails to reach the amount prescribed by categories under subparagraphs
of Article 14
(4) continuously for one year or longer;
7. If it fails to continue its business for one year or longer without a justifiable ground; or
8. If it fails to file for the registration of its establishment under the provision of Article 4 within six months
after the authorization for establishment is given.
(3) The Financial Services Commission shall hear the opinion of the National Federation Chairperson in issuing
an order for the suspension of the entire business of a union or revoking the authorization for
establishment of a union under the provision or paragraph (2). <Amended
by Act No. 8863, Feb. 29, 2008>
[This Article Wholly Amended by Act No. 6204, Jan. 28, 2000>
Article 86 (Management under Administratorship)
(1) The Financial Services Commission may appoint an administrator for
42
management of a union, if the union falls under any of the following
subparagraphs and thus is highly anticipated to cause serious damages to its members’ interest: <Amended by Act No. 5739, Feb. 1, 1999; Act No. 6204, Jan.
28, 2000; Act No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
1. If it is anticipated as a result of the inspection conducted under the
provision of Article 83 (2) that its equity capital is likely to be impaired completely because the union has illegal or non-performing
loans as prescribed by Presidential Decree, but it is difficult for it to recover
them within a short period of time by an ordinary way: (a) and (b) Deleted; <by Act No. 6204, Jan. 28, 2000>
2. If it is anticipated difficult for the union to promote to normalize its
business on its own due to a loss in its assets caused by an unlawful or wrongful conduct of an executive or an employee of the
union;
3. If there is a rush of demands for withdrawal of the deposits and
installment savings in the union or if the union is brought down to the state that it is not able to pay back
the deposits and installment savings because of a significant danger of bankruptcy or an unlawful
or wrongful conduct of its executive or employee;
4. If it is found as a result of the inspection under the provision of Article
83 (2) that it falls within the criteria as prescribed by Presidential
Decree, when the appropriateness of its capital, the soundness of its assets, etc. are considered, although it does
not falls under any of subparagraph 1 through 3; or
5. If the National Federation Chairperson recommends, as a result of the analysis and evaluation of its business
performance or the inspection conducted under the provisions of Article 89 (3) and (6), that it is
necessary to subject it to the management under administratorship. In such cases, the Financial Services Commission
shall verify if it falls under one of subparagraph 1 through 4.
(2) Once the management under administratorship under the provision of paragraph (1) commences, the Financial
Services Commission shall suspend the payment for obligations or suspend the performance of
executives’ duties for a period of time not exceeding six months, and shall require the administrator to inspect the
current status of assets of the union (hereinafter referred to as “asset inspection”). <Amended by Act No. 5739,
Feb. 1, 1999; Act No. 6204, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
43
(3) Deleted. <by Act No. 6204, Jan. 28, 2000>
(4) The Financial Services Commission may request the head of a central administrative agency to furnish it with the data
necessary for the measures
under the provision of Article 86-2. In such cases, the head of the central administrative agency shall, upon the receipt
of such a request, respond to such a request properly unless there is an extraordinary circumstance
otherwise. <Amended by Act No. 6204, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
(5) The Financial Services Commission may remove the suspension under the provision of paragraph (2) completely or partially,
if there is a ground
as prescribed by Presidential Decree such as a possibility of normalizing the management of the union. <Newly Inserted by Act No. 5739, Feb. 1, 1999; Act
No. 6204, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
(6) When a union becomes subject to the management under
administratorship under the provision of paragraph (1), it shall publicly notify the substance of such measure,
without delay, as prescribed by
Presidential Decree. <Newly Inserted by Act No. 6204, Jan. 28, 2000>
(7) Necessary matters concerning the management under administratorship under the provisions
of paragraphs (1) and (2), the
methods, period of time, and procedure of the suspension of payments for obligations or the suspension of performance
of executives’ duties, and
so forth shall be prescribed by Presidential Decree. <Amended by Act No. 5739, Feb. 1, 1999; Act No. 6204, Jan. 28, 2000>
Article 86-2 (Qualification, Authority, etc. of Administrator)
(1) Any person who has interest in or a special relationship with a union
as prescribed by Presidential Decree may not be appointed as the administrator of the union under the provision
of Article 86 (1) or 86-4 (5) (hereinafter referred to as the “administrator”). <Amended by Act No. 8145,
Dec. 30, 2006>
(2) The administrator shall have an authority to execute the business affairs of the union subjected to the
management under administratorship and manage and dispose of its assets in accordance with the purpose of the appointment
or an authority to manage and dispose of the assets, liabilities, etc. of the union within the scope of the business
affairs relating to a decision made on the assignment of contracts. In such cases, the administrator may not assert
his/her authority to a third party in doing a legal act such as disposition of assets of the union, unless he/she completes
44
the registration under the provision of Article 86-3 or 86-4 (6). <Amended
by Act No. 8145, Dec. 30, 2006>
(3) The administrator shall search for the assets of executives or employees found liable for illegal or non-performing loans
(including former executives or employees) or debtors, and shall take necessary measures including an application
for provisional seizure, if necessary for securing the claims for the illegal or non-performing loan.
(4) The Financial Services Commission has an authority to remove an administrator, if considered necessary. <Amended by Act No. 8863, Feb. 29, 2008>
(5) The provisions of Article 35 (1) of the Civil Act, Article 11 (1) of the Commercial Act, and Article 30 and Article 360 through 362 of the Debtor Rehabilitation and
Bankruptcy Act shall apply mutatis mutandis
to the administrator. In such cases the term “court” in Articles 30, 360, and 362 of the Debtor Rehabilitation and
Bankruptcy Act shall be construed as the “Financial Services Commission.” <Amended by Act No. 6957, Jul. 30, 2003;
Act No. 7428, Mar. 31, 2005; Act No. 8863, Feb. 29, 2008> [This Article Newly Inserted by Act No. 6204, Jan. 28, 2000]
Article 86-3 (Notification and Registration of Management under
Administratorship)
(1) When the management under administratorship commences in
accordance with the provisions of Article 86, the Financial Services
Commission shall, without delay, notify the district count having jurisdiction over the address of the principal
place of business of the union subject to the management under administratorship of the purport of such
measure, and shall request the register office having jurisdiction over the addresses of the principal place of business
of the union and its branch offices to complete the registration of such measure. <Amended by Act No.
8863, Feb. 29, 2008>
(2) The register office shall, upon receiving such a request under the
provision of paragraph (1), complete the registration without delay.
[This Article Newly Inserted by Act No. 6204, Jan. 28, 2000]
Article 86-4 (Decision on Assignment of Contracts)
(1) If a union falls under any subparagraph of Article 86 (1), the Financial
Services Commission may decide to assign the contracts (hereinafter referred to as “assignment of contracts”)
relating to the business of the
union (hereinafter referred to as “insolvent union”), hearing the opinion of the fund management committee
under the provision of Article 80-2
45
(3). <Amended by Act No. 8863, Feb. 29, 2008>
(2) In making an decision on the assignment of contracts under the provision of paragraph (1), the Financial Services Commission
shall determine the
scope, terms, and conditions of contracts to be assigned and the union to whom the contracts shall be assigned (hereinafter
referred to as the “assignee-union”) as necessary. In such cases, the Commission shall obtain
the consent of the assignee-union in advance. <Amended by Act No. 8863, Feb.
29, 2008>
(3) The National Federation may propose to the assignee-union the amount
and conditions of its financial aid on the premise that the assignee-union shall perform its obligations under the assignment
of contracts.
(4) When the assignee-union convenes the general meeting to resolve to consent under the provision of the latter part of
paragraph (2), the National Federation shall notify the members of the assignee-union in advance
of the matters relating to such as resolution of the general meeting including the degree of insolvency of the insolvent union
and the measures to be taken in relation to the assignment of contracts.
(5) The Financial Services Commission shall appoint an administrator to the insolvent union against which a decision
is made to assign its contracts in accordance with the provision of paragraph (1). <Amended by Act No. 8863,
Feb. 29, 2008>
(6) When the Financial Services Commission appoints an administrator
under paragraph (5), it shall notify the district court having jurisdiction over the address of the principal place
of business of the insolvent union of the purport of its appointment without delay, and shall request the
register office having jurisdiction over the union’s principal place of business and its branch offices to register the appointment.
<Amended by Act No. 8863,
Feb. 29, 2008>
(7) The assignment of contracts made in accordance with the decision
to that effect under the provision of paragraph (1) does not require a resolution of the board of directors or the
general meeting of the insolvent
union.
[This Article Newly Inserted by Act No. 8145, Dec. 30, 2006]
Article 86-5 (Effect of the Decision on Assignment of Contracts)
(1) Where a decision is made to assign contracts to another union under
the provision of Article 86-4 (1), the assignee-union shall succeed to the
46
rights, obligations, and common bond of the insolvent union, as included
in the scope of the decision, as of the time when such a decision is made.
(2) When a decision is made to assign contracts to another union under the provision of Article 86-4 (1), the insolvent
union and the assignee-union
shall jointly make a public notification of the substance of such as decision and the assignment of contracts through two or
more daily newspapers.
(3) When a public notification is made under the provision of paragraph (2), the assignee-union shall succeed to the
insolvent union’s legal relations with the creditors, debtors, and guarantors who have pledged their property
and other interested parties who have interests in the assignment of contracts (hereinafter referred to as
“creditors, etc.”) on the same terms and conditions as before: Provided, That the creditors, etc. may assert
their rights and claims against the assignee-union on the ground of an event or cause that has occurred between the
insolvent union and them before the public notification.
(4) When a public notification is made under the provision of paragraph (2), it shall be deemed that such a public notification
satisfies the requisites for asserting the assignment of a nominative claim against the obligor
under the provision of Article 450 of the Civil Act: Provided, That creditors, etc. may assert their rights and claims against the assignee-union on the ground of an event or
cause that has occurred between the insolvent
union and them before the public notification.
(5) Where a decision is made to assign contracts under the provision of
Article 86-4 (1), the assignee-union shall acquire the rights relating to and interests in the real property,
transfer of which requires registration,
as of the time when an public notification is made under the provision of paragraph (2).
(6) The Financial Services Commission shall require the insolvent union and the assignee-union to preserve and keep
safe the materials relating to the assignment of contracts and make them available to creditors, etc.
for inspection. In such cases, the guidelines and procedure necessary for preserving, safekeeping, and making such
materials available for inspection shall be prescribed by the Financial Services Commission.
<Amended by Act No. 8863, Feb. 29, 2008>
[This Article Newly Inserted by Act No. 8145, Dec. 30, 2006]
Article 87 Deleted. <by Act No. 6204, Jan. 28, 2000>
47
Article 88 (Application for Bankruptcy)
The Financial Services Commission may file an application for bankruptcy
of a union with the district court having jurisdiction over the address of the union’s principal place of business,
if it is found, as a result of
the actual inspection of the assets of a union subjected to the management under administratorship under the provisions of
Article 86, that it is unable to perform its obligations fully with its own assets and if it falls under
either of the following subparagraphs or if the contracts of the insolvent union is completely assigned in accordance
with the decision on the assignment of such contracts: <Amended by Act No. 6256, Jan. 28, 2000; Act No. 8145,
Dec. 30, 2006; Act No. 8863, Feb. 29, 2008>
1. If it is difficult to protect members of the union because there is no
union that desires to acquire the union through a merger; or
2. If the National Federation concludes that it is difficult for the union to normalize its business within three
years even if a loan is granted
to the union.
Article 88-2 (Bankruptcy Trustee)
The Financial Services Commission may recommend a person for
bankruptcy trustee to the court, notwithstanding the provisions of Article
355 of the Debtor Rehabilitation and Bankruptcy Act, when a union is declared bankrupt. <Amended by Act No. 7428, Mar. 31, 2005; Act No. 8863, Feb. 29, 2008>
[This Article Newly Inserted by Act No. 6256, Jan. 28, 2000]
Article 89 (Guidance and Supervision by the National Federation)
(1) In order to perform the business activities under Article 78 (1), the
National Federation may guide and supervise unions, provide them with guidelines necessary for such activities, and
demand them to submit data,
dispatch persons concerned to appear before the Federation or make a statement.
(2) A union shall, upon the receipt of the demand for submission of data, appearance of persons concerned, or making
a statement under the provision of paragraph (1), respond to the request accordingly without
delay.
(3) The National Federation Chairperson may analyze and evaluate the data submitted by a union in accordance with
the provision of paragraph
(1) in a manner prescribed by the Financial Services Commission, and may require the union to publicly notify the
results thereof. <Amended by
48
Act No. 5739, Feb. 1, 1999; Act No. 6256, Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
(4) The National Federation Chairperson shall recommend a union to merge
with another union or take a proper measure to improve its financial state through disposition of its own assets, downsizing
of its organization, or any other way, if it is anticipated difficult, as a result of the analysis
and evaluation conducted under the provision of paragraph (3), for the union to conduct sound management because
the union falls under the criteria prescribed by the Financial Services Commission pursuant to the
provisions of Presidential Decree. <Amended by Act No. 6256, Jan. 28, 2000; Act No.
6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
(5) If a union fails to take the measures to improve its financial state
earnestly under the provision of paragraph (4), the Financial Services
Commission shall conduct an inspection under the provision of Article
83 (2) to determine whether the union falls under the requirements for the management under administratorship under
the provision of Article
86 (1). <Newly Inserted by Act No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
(6) The National Federation Chairperson may assign an employee of the Federation to conduct an inspection of the business
affairs of a union, if considered necessary.
(7) The National Federation Chairperson may order a union to take a necessary measure including correction, or may
take any of the following measures him/herself, according to the results of the inspection under
the provision of paragraph (6): <Amended by Act No. 5739, Feb. 1, 1999; Act No. 6256, Jan. 28, 2000; Act No. 6957, Jul. 30, 2003>
1. Demand to take a measure against an executive or an employee involved
under the provision of Article 84 (1);
2. Appointment of an ad hoc executive under the provision of Article
84 (3);
3. Request for the registration of an ad hoc executive under the proviso of Article 84 (4);
4. Measures under the provision of Article 85 (1); or
5. Suspension of the entire business under the provision of Article 85 (2).
(8) The National Federation Chairperson shall report to the Financial
Services Commission the matters necessary for imposition of a fine for negligence, if he/she discovers an act subject
to imposition of a fine for
49
negligence under any of Article 101 (1) as a result of the inspection
conducted to a union under the provision of paragraph (6). <Newly Inserted
by Act No. 6957, Jul. 30, 2003; Act No. 8863, Feb. 29, 2008>
Article 89-2 (Request for Inspection from Union Members or Unions)
(1) Union members who suspect that their union executes its business
affairs in violation of the procedure or in breach of its duties prescribed by this Act, an order issued under this
Act, the articles of association,
or a regulation may request the National Federation to conduct an inspection of the union, if they obtain
the consent of at least one percent
of all union members, or the Governor of the Financial Supervisory Service to conduct it, if they obtain the consent of
at least three percent of all union members.
(2) Unions that suspect that the National Federation executes its business affairs in violation of the procedure or in
breach of its duties prescribed by this Act, an order issued under this Act, the articles of association,
or a regulation may request the Governor of the Financial Supervisory Service to inspect the National Federation
to with the consent of at least three percent of all member unions.
(3) The Governor of the Financial Supervisory Service or the National Federation Chairperson shall, upon the receipt
of the request for inspection under the provision of paragraph (1) or (2), conduct an inspection without
delay.
[This Article Newly Inserted by Act No. 6957, Jul. 30, 2003]
Article 90 Deleted. <by Act No. 6957, Jul. 30, 2003>
CHAPTER V SUPPLEMENTARY PROVISIONS
Article 91 Deleted. <by Act No. 5739, Feb. 1, 1999>
Article 92 (The Government’s Cooperation, etc.)
(1) The Government shall provide supports necessary for the business
of unions and the National Federation for unions’ growth, and shall provide the facilities of the State or a public
organization preferentially for the use by unions and the National Federation.
(2) The central government or a local government may grant a subsidy necessary for the business of unions and the
National Federation within
50
the limit of its budget.
Article 93 (Prohibition of Involvement in Politics)
Neither a union nor the National Federation may do any act to involve
in politics.
Article 94 (Contracts with Foreign Institutions)
The National Federation may enter into insurance agreements, etc. with
international organizations in connection with its business to manage its fund safely.
Article 95 (Special Exceptions to the Agricultural Cooperatives, etc.)
(1) The following legal entities shall be deemed to be credit unions under
this Act when they engage in the business activities set forth in Article
39 (1) 1 through 6: <Amended by Act No. 6018, Sept. 7, 1999; Act No. 6187, Jan. 21, 2000; Act No. 6204, Jan. 28, 2000>
1. Local agricultural cooperatives and local livestock cooperatives
(including commodity cooperatives that provide credit service)
established under the Agricultural Cooperatives Act;
2. Local fisheries cooperatives (including the cooperatives that provide credit service under the provision of Article
5 of Addenda of the
Amendment to the Fisheries Cooperatives Act (Act No. 4820))
established under the Fisheries Cooperatives Act;
3. Deleted; <by Act No. 6018, Sep. 7, 1999>
4. Forestry cooperatives established under the Forestry Cooperatives
Act; and
5. Deleted. <by Act No. 6018, Sep. 7, 1999>
(2) In case of paragraph (1), the business of the National Federation shall be carried out by the national
federations established under the Acts set forth in subparagraphs of paragraph (1) respectively (including
the National Forestry Cooperatives Federation; the same shall apply hereinafter for the purpose of this Article).
<Amended by Act No. 6187, Jan. 21,
2000>
(3) Each cooperative and the National Federation under the provisions of paragraphs (1) and (2) shall separate the
business of credit union from other business, when they engage in the business of credit union.
(4) This Act excluding the provisions of Article 6 (3) and (4), Article
39 (1) 1 and 6, Articles 42, 43, 45, 78 (1) 5, 83, 83-2, 83-3, 84, 89 (3), and 96 shall not apply to the
business of the cooperatives and their
51
National Federations under the provisions of paragraphs (1) and (2).
<Amended by Act No. 5739, Feb. 1, 1999; Act No. 6018, Sep. 7, 1999; Act No. 6204, Jan. 28, 2000; Act No. 6957, Jul. 30, 2003>
Article 96 (Delegation of Authority)
(1) The authority of the Financial Services Commission under this Act
may be delegated entirely or partially to the Governor or the Financial
Supervisory Service or the National Federation Chairperson as prescribed by Presidential Decree. <Amended by Act No. 8863, Feb. 29, 2008>
(2) The Governor of the Financial Supervisory Service may delegate to
the National Federation Chairperson his/her authority under this Act or the authority delegated from the
Financial Services Commission under the provision of paragraph (1) in part, as prescribed by Presidential Decree,
if considered necessary to do so. <Amended by Act No. 6204, Jan. 28, 2000; Act No.
8863, Feb. 29, 2008>
Article 97 (Mutual Aid Service)
(1) Unions and the National Federations shall prepare the regulation on
mutual aid service to obtain an authorization from the Financial Services
Commission, if they engage in mutual aid service. <Amended by Act No. 8863,
Feb. 29, 2008>
(2) The mutual aid regulation under paragraph (1) shall provide for the
method of providing such a service, the mutual aid agreement, the mutual aid fee, etc. <Amended by Act No. 5739, Feb. 1, 1999; Act No. 6204, Jan. 28, 2000; Act No.
8863, Feb. 29, 2008>
(3) An amendment or repeal of the mutual aid regulation under the provision
of paragraph (1) requires a prior authorization of the Financial Services
Commission. <Amended by Act No. 8863, Feb. 29, 2008>
Article 98 (Hearing)
The Financial Services Commission shall hold a hearing, when it intends
to revoke an authorization for establishment under the provision of Article
85 (2). <Amended by Act No. 5739, Feb. 1, 1999; Act No. 5982, May 24, 1999; Act No. 6204,
Jan. 28, 2000; Act No. 8863, Feb. 29, 2008>
CHAPTER VI PENAL PROVISIONS
Article 99 (Penal Provision)
(1) An executive, an employee, or a liquidator of a union or the National
Federation who commits either of the following conducts shall be punished
52
by imprisonment for not more than three years, a fine not exceeding 20
million won, or both: <Amended by Act No. 5739, Feb. 1, 1999>
1. If he/she uses the fund for any purpose other than the purpose of business of the union or the National Federation,
or inflict a damage
upon the union or the Federation by disposing of or misappropriating any of its assets; or
2. If he/she obtains the authorization for establishment in violation of the provisions of Article 7.
(2) Any executive, employee or liquidator of a union or the National
Federation who commits either of the following conducts shall be punished by imprisonment for not more than two years or
a fine not exceeding 10 million won: <Amended by Act No. 6204, Jan. 28, 2000; Act No. 6957, Jul. 30, 2003; Act No.
8863, Feb. 29, 2008>
1. If he/she holds a registration by falsity;
2. If he/she grants loans, etc. to a person exceeding the limit for one person in violation of the provisions of Article
42;
3. If he/she violates the provision of Article 30-2, 43 (1), 49 (1) or 59
(3);
4. If he/she prepares a false financial statement to obtain an approval of the general meeting in violation of the
accounting principles or the
guidelines for the settlement of accounts prescribed by the Financial Services Commission in accordance with the provision
of Article 47 (2);
5. If he/she violates the provision of Article 81 (3) or (4);
6. If he/she does not accede to the management under administratorship under the provision of Article 86 (1);
7. If he/she refuses to submit data, appear, make a statement in violation of the provision of Article 89 (2) or submits
false data or makes a misrepresentation; or
8. If he/she rejects, hinders, or evades from the inspection conducted by a supervisory institution.
(3) Any person who violates the provision of Article 3 (2), 27-2 (including
the cases to which said provision shall apply mutatis mutandis pursuant to the provision of Article 72 (7)) or 93 shall be punished by imprisonment for not more than one year or a fine not
exceeding five million Won. <Amended
by Act No. 6957, Jul. 30, 2003>
53
(4) Any person who omits a public notification or makes a false public
notification in violation of the provision of Article 83-2 shall be punished by imprisonment for not more than one
year or a fine not exceeding five
million Won. <Newly Inserted by Act No. 5739, Feb. 1, 1999>
Article 100 (Joint Penal Provision)
Where the representative, an agent, a servant, or an employee of a union
or the National Federation commits an offense prescribed in Article 99 (1) or (2) in connection with the business
of the union or the National
Federation, not only shall the wrongdoer be punished accordingly, but the union or the National Federation shall
be punished by a fine under
the same paragraph of said Article.
Article 101 (Fine for Negligence)
(1) A union or the National Federation shall be punished by a fine for
negligence not exceeding ten million Won, if falls under one of the following subparagraphs: <Amended by Act No. 8145, Dec. 30, 2006>
1. If it amends the articles of association in violation of the provision of Article 24 (2);
2. If it omits to submit the report on the settlement of accounts to the
National Federation Chairperson in violation of the provision of Article
47 (4);
3. If it omits to have the accounting audit by an auditor under the provision of Article 47 (5) or 81 (2) without a justifiable
ground;
4. If it omits to submit the report under the provision of Article 83-4
or submits a false report;
5. If it omits to make a public notification in violation of the provision of Article 86-5 (2); or
6. If it omits to preserve or manage the materials relating to the assignment of contracts or make them available to creditors,
etc. for inspection in violation of the provision of Article 86-5 (6).
(2) The fine for negligence under the provision of paragraph (1) shall be imposed and collected by the Financial
Services Commission as prescribed by Presidential Decree. <Amended by Act No. 8863, Feb. 29, 2008>
(3) Any person, who is dissatisfied with a disposition of fine for negligence under paragraph (2), may raise an objection
to the Financial Services Commission within thirty days after he/she is notified of the disposition.
<Amended by Act No. 8863, Feb. 29, 2008>
54
(4) If any person, who is subject to a disposition of fine for negligence
under paragraph (2), raises an objection under paragraph (3), the Financial
Services Commission shall, without delay, notify the competent court of the objection, and the court shall, in turn,
proceed to a trial on the fine
for negligence pursuant to the Non-Contentious Case Litigation Procedure
Act. <Amended by Act No. 8863, Feb. 29, 2008>
(5) If no objection is raised within the period as specified in paragraph (3), nor the fine for negligence shall be collected
by referring to the practices for the dispositions on default of national taxes.
[This Article Newly Inserted Act No. 957, Jul. 30, 2003]
ADDENDA
Article 1 (Enforcement Date)
This Act shall enter into force on April 1, 1998: Provided, That the
preparatory actions necessary for the abolition of the National Association may be done before this Act enters into force.
Article 2 (Transitional Measures concerning Transfer of Security Fund)
(1) The authorizations, permissions, and other acts done by the National
Federation in connection with the security fund under the former provisions as of the time when this Act enters into
force shall be deemed to be the
acts done by Korea Deposit Insurance Corporation pursuant to this Act.
(2) The reports, payments, and other acts done by unions to the National
Federation in connection with the security fund under the former provisions as of the time when this Act enters into
force shall be deemed to be the
acts done to Korea Deposit Insurance Corporation pursuant to this Act.
(3) The security fund as of the time this Act enters into force shall be transferred to Korea Deposit Insurance Corporation.
(4) Korea Deposit Insurance Corporation shall succeed to all the rights and obligations of the National Federation in
connection with the security
fund as of the time when this Act enters into force.
(5) The titles of the National Federation recorded in the registers and indicated in various kinds of certificates,
etc. in connection with the security
fund as of the time this Act enters into force shall be deemed to be those of Korea Deposit Insurance Corporation.
(6) The National Federation and Korea Deposit Insurance Corporation
shall prepare the list of assets, accounting books, data, etc. relating to
55
the security fund before this Act enters into force to obtain an approval
of the Minister of Finance and Economy, and shall prepare for transferring them to Korea Deposit Insurance Corporation.
Article 3 (Transitional Measures concerning the Establishment and
Management of the Security Fund)
The legal entities specified in each subparagraph of Article 95 (1) may
establish and manage the security fund in accordance with the former provision of Article 83-18 (10), notwithstanding
the amendment of this
Act. <Amended by Act No. 6018, Sep. 7, 1999; Act No. 6187, Jan. 21, 2000; Act No. 6256, Jan.
28, 2000>
Article 4 (Transitional Measures Following Abolition of the National
Association)
(1) The member unions of the National Credit Union Association under
former provisions as of the time when this Act enters into force shall be deemed to be the members of the National Federation.
(2) The National Credit Union Association under former provisions as
of the time this Act enters into force shall be deemed to be dissolved as of the enforcement date of this Act, notwithstanding
former provisions concerning dissolution and liquidation, and the National Federation shall
succeed to all rights and obligations of the National Credit Union Association and the employment relations
with its employee comprehensively.
(3) The titles of the National Credit Union Association to the property and rights recorded in the registers
or indicated in various kinds of certificates shall be deemed to be those of the National Federation.
(4) The value of the assets to which the National Federation shall succeed under the provision of paragraph (2) shall
be the book value as of the day before the enforcement date of this Act.
(4) The assets to which the National Federation shall succeed under the provision of paragraph (2) shall be deemed to
be the investments by the unions in the National Federation.
Article 5 (Transitional Measures Following Establishment of General
Meeting)
A resolution adopted by the representatives’ meeting of the National
Federation before the enforcement date of this Act shall be deemed to be the resolution by the general meeting of the National
Federation.
56
Article 6 (Amendment of the Articles of Association)
The unions and the National Federation shall amend their articles of
association respectively in accordance with this Act within three months of the enforcement date of this Act.
Article 7 (Transitional Measures concerning Terms of Executives and
Representatives)
(1) The terms of the executives of the unions and the National Federation
already elected under the former provisions at the time when this Act enters into force shall be governed by
the former provisions: Provided,
That the term of the executives of the unions and the National Federation elected during the period of time from January
1, 1998 through March
31, 1998 shall end on the opening date of the general meeting held first
after the enforcement date of this Act.
(3) The term of the representatives elected first after the enforcement date of this Act shall end on the
opening date of the general meeting
held in 2002.
Article 8 (Relation to Other Statutes)
A citation of the “National Credit Union Association” in any other statute
enforceable at the time when this Act enters into force shall be deemed to be the citation of the “National Credit Union
Federation.”
Article 9 Omitted.
ADDENDUM <Act No. 5739, Feb. 1, 1999>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 5982, May 24, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. <Proviso
Omitted.>
Article 2 through 6 Omitted.
ADDENDA <Act No. 6018, Sep. 7, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2000. <Proviso Omitted.>
Articles 2 through 21 Omitted.
57
ADDENDA <Act No. 6187, Jan. 21, 2000>
Article 1 (Enforcement Date)
This Act shall enter into force on May, 1, 2000. <Proviso Omitted.>
Articles 2 through 14 Omitted.
ADDENDA <Act No. 6204, Jan. 28, 2000>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its
promulgation: Provided, That the provisions of Article 95 as amended shall enter into force on July 1, 2000, but preparatory works
for the
enforcement of this Act including the preparation and amendment of the articles of association necessary for the enforcement
of this Act and the
appointment and removal of the executives of unions and the National
Federation may be processed before this Act enters into force.
Article 2 (Applicability to and Transitional Measures concerning the
Standing President of Unions)
(1) The proviso to Article 27 (6) as amended shall be applicable to the
standing union presidents elected first after this Act enters into force and afterwards.
(2) A union that shall have a standing president under the proviso to
Article 27 (6) as amended, but whose incumbent president still has the remaining term of two or more years as of the
time when this Act enters into force shall elect the standing president under the amended provision
within one year after this Act enters into force. In such cases, the term of the president under the former provision
shall be deemed to have expired.
(3) The term of the union president elected to the standing president
under the provision of paragraph (2) shall be the remaining term of his/her predecessor, and a person who serves as the
union president incumbent as of the time when this Act enters into force and then is newly elected
again shall not be deemed to be elected for another term consecutively under the provisions of Article 31.
Article 3 (Transitional Measures concerning the Grounds of
Disqualification for Executives, etc.)
If an executive, etc. of a union falls under any of grounds of disqualifications
under the provision of Article 28 (1) as amended (including the cases
58
to which said provision shall apply mutatis mutandis pursuant to Article
72 (5)) due to a cause or an event that occurred before this Act enters into force, the former provision shall apply
notwithstanding the amended
provision.
Article 4 (Transitional Measures concerning the Standing Executives of the National Federation)
The National Federation Chairperson shall appoint the standing directors
under the provision of Article 71 as amended within three months after this Act enters into force.
Article 5 (Transitional Measures concerning the Union subject to
Management under Administratorship)
As to the unions subject to the management under administratorship in
accordance with former provisions as of the time when this Act enters into force, the former provisions shall
apply notwithstanding the amended
provisions of Article 86.
ADDENDA <Act No. 6256, Jan. 28, 2000>
Article 1 (Enforcement Date)
(1) This Act shall enter into force on July 1, 2000. <Proviso Omitted.>
(2) Omitted.
Articles 2 through 14 Omitted.
ADDENDA <Act No. 6957, Jul. 30, 2003>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its
promulgation: Provided, That the provisions of Section 4 of Chapter III, Article 86-2 (5), and Article 90 as amended shall enter into force
on January
1, 2004.
Articles 2 (Applicability to Prohibition against Putting Invested Capital in Pledge)
The provision of Article 14 (6) as amended shall not be applicable, for the period of time of three years after
this Act enters into force, to the
pledge rights already established in invested capitals before this Act enters into force.
Article 3 (Applicability to Term of Executives)
The provision of Article 31 (3) as amended shall be applicable to the
59
executives elected first after this Act enters into force and afterwards.
Article 4 (Transitional Measures concerning Appointment of Executives of the National Federation)
(1) The National Federation shall elect the President for credit and mutual
aid services, the Director for inspection and supervision, and professional directors under the provisions of Article
71-2 as amended at the general
meeting held first after this Act enters into force.
(2) The National Federation Chairperson and the persons who serve as the executives of the National Federation under
former provisions at the
time when this Act enters into force shall be deemed to be the National
Federation Chairperson and directors elected at the general meeting under the provisions of Article 71-2 as amended: Provided, That the term of
the National Federation Chairperson and the directors shall end on the expiry of the term under the former provisions.
Article 5 (Transitional Measures concerning Establishment of the Audit
Committee)
The National Federation shall establish the Audit Committee under the
provisions of Article 76 as amended at the general meeting convened first after this Act enters into force.
Article 6 (Transitional Measures concerning the Establishment of Guidelines for Internal Control and Appointment of the Compliance Officer)
The National Federation shall establish the guidelines for internal control
under the provisions of Article 76-3 within three months after this Act enters into force, and shall appoint the compliance
officer.
Article 7 (Transitional Measures concerning Qualification for Executives)
If a person who serves as an incumbent executive of a union or the National
Federation at the time when this Act enters into force falls under any ground of disqualification under the provision
of Article 28 (1) as amended
(including a case to which said provision shall apply pursuant to Article
71-2 (6)) due to a cause or an event that occurred before this Act enters into force, the former provisions shall apply
notwithstanding the amended
provision.
Article 8 (Transitional Measures concerning Borrowings and Investment of the National Federation)
The funds borrowed and invested in other legal entities by the National
Federation before this Act enters into force shall be deemed to have obtained
60
an approval of the Financial Supervisory Commission under the provision
of Article 78 (5) as amended.
Article 9 (Transitional Measures concerning Appointment of
Administrator)
The administrators appointed for the management under
administratorship before this Act enters into force shall be governed by the former provisions notwithstanding the
provision of Article 86-2 (5) as amended.
Article 10 (Transitional Measures concerning Penal Provisions)
The conducts committed before this Act enters into force shall be governed
by the former penal provisions.
ADDENDA <Act No. 7428, Mar. 31, 2005>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 7428, Mar. 31, 2005>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDUM <Act No. 8145, Dec. 30, 2006>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 8635, Aug. 3, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force one year and six months after the date
of its promulgation. <Proviso Omitted.>
Articles 2 through 44 Omitted.
ADDENDA <Act No. 8840, Jan. 17, 2008>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 8852, Feb. 29, 2008>
61
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided,
That ...<omitted>... among Acts amended under Article 6 of these Addenda, the amended provisions of any Act which
is promulgated before this Act
enters into force, but which does not enter into force shall enter into force on the date when such Act does so.
Articles 2 through 7 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 through 5 Omitted.
62
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