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Interest limitation act

제10편 민사법 이자제한법

INTEREST LIMITATION ACT

Act No. 971, Jan. 15, 1962

Amended by Act No. 1710, Sep. 24, 1965

Article 1 (Maximum Interest Rate)

(1) The maximum interest rate to be specified in a contract of pecuniary
loan shall be determined within the limit of forty percent (40%) per annum by the Presidential Decree. <Amended by Act No. 1710, Sep. 24, 1965>
(2) The provision of the preceding paragraph shall not apply to the interest
accruing from the principal of a loan where the amount of the principal is less than five thousand won. <Amended by Act No. 1710, Sep. 24, 1965>
(3) The maximum interest rate under paragraph (1) shall refer to the
rate at the time when a contract has been made. <AmendedbyActNo.1710, Sep. 24, 1965>

Article 2 (Nullity of Excessive Interest)

Any part of the interest specified in a contract which is in excess of the
limitation of interest mentioned in the preceding Article shall be null and void.

Article 3 (Presumptive Interest)

A reward, discount, fee, deduction, advance, or any other money received
by the obligee in terms of pecuniary loan, regardless of its designation, shall be deemed as interest.

Article 4 (Reduction of Compensation)

The Court may, if it deems the predetermined amount of compensation
in relation to non-performance of pecuniary obligations, set forth between the parties, improper, reduce the amount of compensation to a reasonable
amount.

ADDENDA

(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation.

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INTEREST LIMITATION ACT

(2) (Acts and Subordinate Statutes to be Repealed) The Interest Limitation
Decree, i. e., Jeryong (Decree) No. 13, promulgated in 1911, shall hereby
be repealed.

ADDENDUM <Act No. 1710, Sep. 24, 1965>

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

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