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Korea technology credit guarantee fund act

제22편 통화․국채․금융 기술신용보증기금법

KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

Wholly Amended by Act No. 4068, Dec. 31, 1988

Amended by Act No. 4541, Mar. 6, 1993

Act No. 4955, Aug. 4, 1995

Act No. 5188, Dec. 30, 1996

Act No. 5374, Aug. 28, 1997

Act No. 5403, Aug. 30, 1997

Act No. 5505, Jan. 13, 1998

Act No. 5701, Jan. 29, 1999

Act No. 6022, Sep. 7, 1999

Act No. 6705, Aug. 26, 2002

Act No. 7884, Mar. 24, 2006

Act No. 8541, Jul. 23, 2007

Act No. 8635, Aug. 3, 2007

Act No. 8852, Feb. 29, 2008

Act No. 8863, Feb. 29, 2008

Act No. 9456, Feb. 6, 2009

Act No. 9584, Apr. 1, 2009

CHAPTER Ⅰ GENERAL PROVISIONS

Article 1 (Purposes)

The purposes of this Act are to make funds more readily available for
new technology businesses and to accelerate the development of the national
economy by stabilizing and developing the technology credit guarantee
system through the establishment of the Korea Technology Credit Guar-
antee Fund. <Amended by Act No. 5374, Aug. 28, 1997>

Article 2 (Definitions)

For the purpose of this Act, the definitions of terms shall be as follows:

<Amended by Act No. 4955, Aug. 4, 1995; Act No. 5374, Aug. 28, 1997; Act No. 5403, Aug. 30, 1997; Act No. 5505, Jan. 13, 1998; Act No. 6705, Aug. 26, 2002; Act No. 7884, Mar. 24, 2006; Act No. 8635, Aug. 3, 2007; Act No. 9456, Feb. 6, 2009>

1. The term new technology enterprise means a small and medium enter-
prise (referring to a small and medium enterprise prescribed in Article
2 of the Framework Act on Small and Medium Enterprises; hereinafter
the same shall apply) and a company prescribed by Presidential Decree
which develop technologies or commercialize them, and a industrial

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

technology research partnership established under the Act on the
Support of Industrial Technology Research Cooperatives;
2. The term enterprise means an individual or juristic person engaged
in the business, and organizations formed by such persons;
3. and 4. Deleted; <by Act No. 5374, Aug. 28, 1997>
5. The term financial institution means any institution falling under
one of the following items:
(a) Banking institutions referred to in Article 2 (1) 2 of the Banking
Act;
(b) The Korea Development Bank;
(c) The Industrial Bank of Korea;
(d) Deleted; <by Act No. 4955, Aug. 4, 1995>
(e) Deleted; <by Act No. 5403, Aug. 30, 1997>
(f) Deleted; <by Act No. 4955, Aug. 4, 1995>
(g) The Export-Import Bank of Korea;
(h) The Korea Long-term Credit Bank;
(i) A trust business entity under the Financial Investment Services
and Capital Markets Act; or
(j) Others engaging in the business of financing enterprises, as prescri-
bed by Presidential Decree;
6. The term technology credit guarantee means the guarantee of the
monetary liabilities prescribed in Presidential Decree, which are the
monetary liabilities assumed by new technology enterprises to the finance
companies, etc. as they receive a loan of fund or other benefits, etc. from
specialized credit financial business companies or financial institutions
(hereinafter referred to as finance companies, etc. ), which have regis-
tered for new technology project financiers under the Specialized Credit
Financial Business Act, and other monetary liabilities assumed by new
technology enterprises;
7. The term general credit guarantee means the guarantee (excluding
technology credit guarantee) of the monetary liabilities of an enterprise
whose regular employees are not more than one thousand and whose
total amount of assets is not more than one hundred billion won which
falls under one of the following items:
(a) The monetary liabilities to banking institutions in connection with
loans and other financial instruments; or
(b) Other monetary liabilities prescribed in Presidential Decree;
7-2. The term reguarantee means the guarantee of the Fund to indemnify
the original guarantor within the scope of the performed amount by

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제22편 통화․국채․금융 기술신용보증기금법

the guarantee of Article 28-2 (1) (hereinafter referred to as the original guarantee );
8. The term creditor means a creditor of the liabilities guaranteed by the Korea Technology Credit Guarantee Fund;
9. The term fundamental property means the property built up with contributions or in other ways by the Korea Technology Credit Guar- antee Fund as a financial basis for its business operations;
10. Deleted; and <by Act No. 5374, Aug. 28, 1997>
11. The term guarantee for special purpose company means that the
Fund stands guarantee prescribed in Article 28-3 (1) for the debts
borne by a special purpose company established under the Asset-
Backed Securitization Act (hereinafter referred to as SPC ).

Article 3 Deleted. <by Act No. 5701, Jan. 29, 1999>

CHAPTER Ⅱ Deleted.

Articles 4 through 11 Deleted. <by Act No. 5374, Aug. 28, 1997>

CHAPTER Ⅲ KOREA TECHNOLOGY CREDIT GUARANTEE FUND

SECTION 1 Establishment, etc.

Article 12 (Establishment of Fund)

(1) The Korea Technology Credit Guarantee Fund (hereinafter referred to as the Fund ) shall be established to make funds more readily avail- able for enterprises which lack the ability to furnish adequate physical security by extending guarantees for the liabilities which may be incurred by them.
(2) The Fund shall be constituted as a juristic person.

Article 13 (Acquisition of Fundamental Property)

(1) The fundamental property of the Fund shall be derived from: <Amended

by Act No. 4955, Aug. 4, 1995>

1. Contributions from finance companies, etc.;
2. Contributions from the Government; and
3. Contributions from persons other than those prescribed in subpara-
graphs 1 and 2.
(2) The budget for contributions from the Government pursuant to the
provisions of paragraph (1) 2 shall be handled by the Small and Me-
dium Business Administration. <Amended by Act No. 5188, Dec. 30, 1996>

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

(3) Financial companies, etc. shall make contributions to the Fund at such a ratio prescribed by Presidential Decree in connection with the loans they extend.
(4) The scope of loans, method and time of contribution, and other nec- essary matters under paragraph (3) shall be prescribed by Ordinance of the Prime Minister. <Amended by Act No. 4955, Aug. 4, 1995; Act No. 5505, Jan.

13, 1998; Act No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008>

Article 14 (Head Office, Branches, Sub-branches, and Agencies)

(1) The Fund shall establish its head office according to the articles of
incorporation.
(2) The Fund may, subject to the provisions of the articles of incorpo-
ration have its branches, sub-branches or agencies wherever necessary.

Article 15 (Articles of Incorporation)

(1) The Fund s articles of incorporation shall be made upon the resolution
of its board of policy, subject to the approval of the Financial Services
Commission. The same shall apply in case of a change of the articles of
incorporation. <AmendedbyActNo.4955,Aug.4,1995; ActNo.5701,Jan.29,1999;

Act No. 8863, Feb. 29, 2008>

(2) The following matters shall be included in the Fund s articles of in- corporation:
1. Purpose;
2. Name;
3. Matters concerning head office, branches, sub-branches or agencies;
4. Matters concerning the fundamental property;
5. Matters concerning the board of policy;
6. Matters concerning the board of directors;
7. Matters concerning officers and employees;
8. Matters concerning businesses and execution thereof;
9. Matters concerning accounting;
10. Matters concerning the method of giving public notices;
11. Matters concerning the revision of the articles of incorporation; and
12. Other matters prescribed by Presidential Decree.

Article 16 (Registration)

(1) The Fund shall come into being upon completing the registration of
incorporation at the domicile of its head office.
(2) Matters concerning registration of incorporation under paragraph (1),
registrations of change of address and other changes, and other matters
necessary for the registration of the Fund shall be prescribed by Presi-
dential Decree.

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제22편 통화․국채․금융 기술신용보증기금법

(3) Matters which are to be registered under paragraph (2) shall not be
relied upon against the third party until after registration.

SECTION 2 Organs, Officers and Employees

Article 17 (Establishment of Board of Policy)

(1) The board of policy shall be established in the Fund to decide the basic policy on the business of the Fund.
(2) The board of policy shall consist of the following members: <Amended

by Act No. 4955, Aug. 4, 1995; Act No. 5188, Dec. 30, 1996; Act No. 5505, Jan. 13,

1998; Act No. 5701, Jan. 29, 1999; ActNo. 6705, Aug. 26, 2002; Act No. 7884, Mar. 24,

2006; Act Nos. 8852 & 8863, Feb. 29, 2008>

1. The president of the Fund;
2. One person nominated by the Financial Services Commission from among
the public officials belonging to such Commission;
2-2. One person nominated by the Minister of Strategy and Finance from
among the public officials belonging to his Ministry;
2-3. One person nominated by the Administrator of Small and Medium
Business Administration from among the public officials belonging to
such Administration;
3. One person nominated by the governor of the Industrial Bank of Korea
from among the executive officers belonging to such Bank;
4. One person nominated by the head of a financial institution, designated
by the Financial Services Commission, which is provided for in Article
2 (1) 2 of the Banking Act and is engaged in financial business for
the general public and small business enterprises, from among the
executive officers belonging to such financial institution;
5. Three persons entrusted by the Financial Services Commission from
among directors and executive officers of financial companies, etc.;
6. One person entrusted by the president of Korea Chamber of Com-
merce and Industry;
7. One person entrusted by the president of Korea Federation of Small
and Medium Enterprise Cooperatives; and
8. Two technology-related experts entrusted by the Financial Services
Commission subject to consultation with the Minister of Education,
Science and Technology.
(3) The president of the Fund shall be a chairman of the board of policy.
(4) The board members as prescribed in paragraph (2) 1 and 3 through

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

5 may delegate their powers and duties to any officer or employee of their
respective institutions.
(5) The term of office for the board members as prescribed in para- graph (2) 5 through 8 shall be two years: Provided, That the term of
office for a supplementary board member shall be the residual term of his
predecessor.
(6) Matters necessary for the operation, etc. of the board of policy shall
be prescribed by Presidential Decree.

Article 18 (Board of Directors)

(1) The board of directors shall be established at the Fund.
(2) The board of directors shall consist of a president, a managing di-
rector, and other directors.
(3) The board of directors shall decide upon important matters con-
cerning the business operations of the Fund.
(4) The president shall call meetings of the board of directors and serve
as a chairman.
(5) A meeting of the board of directors shall be started by the attendance
of a majority of its members, and the resolutions shall be adopted by
the affirmative vote of a majority of those present.
(6) The auditor may attend and present his opinion at any meeting of
the board of directors.

Article 19 (Officers)

The Fund shall have as its officers one president, one managing director, five or fewer directors, and one auditor.

Article 20 (Duties of Officers)

(1) The president shall represent the Fund and thus administer and di- rect the operations of the Fund.
(2) The managing director shall assist the president and act on behalf
of the president in case of his absence.
(3) The directors shall assist the president and the managing director,
sharing the managerial affairs of the Fund according to the articles of
incorporation.
(4) The directors shall, in the order of priority as determined in advance
by the president, act for the president and the managing director, when
both are absent.
(5) The auditor shall audit the operations and the accounts of the Fund.

Article 21 (Appointment of Officers)

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제22편 통화․국채․금융 기술신용보증기금법

(1) The president and the auditor shall be appointed by the Financial
Services Commission. <Amended by Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan.

29, 1999; Act No. 8863, Feb. 29, 2008>

(2) The managing director and the directors shall be appointed by the Financial Services Commission upon the recommendation of the president of the Fund. <Amended by Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan. 29, 1999;

Act No. 8863, Feb. 29, 2008>

Article 22 (Officers’ Term of Office)

The term of office for the officers shall be three years.

[This Article Wholly Amended by Act No. 5505, Jan. 13, 1998]

Article 23 (Dismissal of Officers)

The Financial Services Commission may dismiss any officer of the Fund who falls under one of the following cases: <Amended by Act No. 4955, Aug.

4, 1995; Act No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008>

1. Where he/she has violated this Act, orders given under this Act, or the articles of incorporation;
2. Where he/she has been sentenced to imprisonment without prison labor or a heavier punishment;
3. Where he/she has declared as a bankrupt; or
4. Where he/she has failed to perform his/her duties on account of mental or physical disability.

Article 24 (Responsibility, etc. of Prohibition of Concurrent Office)

(1) No officers of the Fund shall engage in any other business or occu- pation without permission of the Financial Services Commission. <Amended

by Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008> (2) The officers and employees of the Fund, or persons who have been in such office shall not divulge secrets that they came to know as a matter

of duty. <Newly Inserted by Act No. 9456, Feb. 6, 2009>

Article 25 (Legal Fiction as Public Officer in Application of Criminal Act) The officers of the Fund shall be deemed to be public officials in the ap- plication of Articles 129 through 132 of the Criminal Act. <Amended by

Act No. 7884, Mar. 24, 2006>

Article 26 (Appointment of Proxies)

The president of the Fund may appoint proxies from among the man- aging director, the directors or the employees of the Fund, duly empowered to act on behalf of himself in connection with the operations of the Fund

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

both in judicial and non-judicial matters.

Article 27 (Appointment and Dismissal of Employees)

The employees of the Fund shall be appointed and dismissed by the pres- ident of the Fund.

SECTION 3 Businesses

Article 28 (Businesses of Fund)

(1) The Fund shall perform the following businesses: <AmendedbyActNo.

4955,Aug.4,1995;ActNo.5701,Jan.29,1999;ActNo.6705,Aug.26,2002;ActNo.8863, Feb. 29, 2008>

1. Administering the fundamental property;
2. Issuing technology credit guarantee;
3. Issuing general credit guarantee;
4. Providing services of management consulting and technology consulting to enterprises;
5. Conducting credit investigations and integrated managements of credit information;
5-2. Conducting technology appraisal (referring to indicating the amount,
grades, opinions or points, etc. by an integrated appraisal of the na- ture of technology, marketability, business prospect, etc. related to the relevant technology);
6. Exercising its rights of indemnity;
7. Conducting the investigation into and research on the credit guar- antee system; and
8. Performing, with approval of the Financial Services Commission, other activities incidental to the businesses under subparagraphs 1 through
7.
(2) The Fund may perform the business of reguarantee and guarantee for SPC in addition to the businesses listed in paragraph (1). <NewlyIn- serted by Act No. 4955, Aug. 4, 1995; Act No. 9456, Feb. 6, 2009>
(3) The Fund shall determine in advance matters related to the criteria, procedures, methods, types, etc. of the technology appraisal in order to ensure the objectivity and fairness of the technology appraisal under the
provisions of paragraph (1) 5-2. <NewlyInsertedbyActNo.6705,Aug.26,2002>

Article 28-2 (Reguarantee)

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제22편 통화․국채․금융 기술신용보증기금법

(1) When the Fund intends to provide a reguarantee, it shall conclude a contract
with a credit guarantee foundation prescribed by the Regional Credit
Guarantee Foundation Act (hereinafter referred to as the original guaran- tor ). <Amended by Act No. 6022, Sep. 7, 1999; Act No. 7884, Mar. 24, 2006>
(2) The contract under paragraph (1) shall include matters concerning the ceiling amount, period, requirements, etc. of the reguarantee, and
the contracting method shall be in the blanket stipulation form reguar- anteeing the original guarantee, within the limit of ceiling amount and
period of the reguarantee for the reguarantee contract and satisfying reguar-
antee requirements.
(3) The amount of reguarantee of the Fund shall be the amount calculated by multiplying the amount of original guarantee by a ratio prescribed by
Presidential Decree (hereinafter referred to as reguarantee ratio ). (4) In cases where the original guarantor has made a subrogated perfor-
mance, the amount of compensation to be paid by the Fund shall be cal-
culated by multiplying the amount subrogated by the original guarantor, which is not recovered through exercising the right to indemnity, by the
reguarantee ratio.
(5) If the original guarantor has recovered the amount of subrogation through exercising the right to indemnity under the original guarantee,
the amount calculated by multiplying such recovered amount by the reguar-
antee ratio, shall be returned to the Fund.
(6) The claim for the performance of any reguaranteed liability shall be made at the expiration of a period prescribed by Presidential Decree from
the date of subrogation by the original guarantor, and other matters neces- sary for a claim for the performance of the reguaranteed liability, shall
be prescribed by Presidential Decree.
(7) Other matters necessary concerning the relation between the Fund and the original guarantor in connection with the operation of the re-
guarantee shall be prescribed by Presidential Decree.

[This Article Newly Inserted by Act No. 4955, Aug. 4, 1995]

Article 28-3 (Guarantee for SPC)

(1) Where an SPC pools and repackages corporate bonds (including con- vertible bonds and bonds with warrant), loans or property rights prescribed by Presidential Decree of a new technology enterprise into securitized assets, the Fund may guarantee the liability to be borne by the SPC in cases

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

falling under any of the following subparagraphs:
1. Issuance of securitized bonds; or
2. Granting of credit to the SPC by financial companies, etc., the National Agricultural Cooperative Federation under the Agricultural Cooperatives Act and the National Federation of Fisheries Cooperatives under the
Fisheries Cooperatives Act.
(2) The maximum limit of securitized assets of the same enterprise, which an asset holder (refers to the person under subparagraph 2 of Article 2
of the Asset-Backed Securitization Act) can underwrite with regard to
the operation of guarantee for SPC by the Fund shall be prescribed by
Presidential Decree.
(3) The Fund may be entrusted by an SPC that is given guarantee for SPC with the management of securitized assets or other businesses pre- scribed in Articles 10 (1) and 23 (1) of the Asset-Backed Securitization
Act.
(4) Where it is recognized as necessary for the efficient operation of the
Fund and the appropriate diversification of risks, the Financial Services
Commission may lay down and notify separate guidelines.

[This Article Newly Inserted by Act No. 9456, Feb. 6, 2009]

Article 29 (Operational Manual)

The Fund shall, upon the resolution of the board of policy, prepare the operational manual which provides for the following subparagraphs. The same shall apply to a change of the operational manual: <AmendedbyAct

No. 4955, Aug. 4, 1995; Act No. 6705, Aug. 26, 2002; Act No. 9456, Feb. 6, 2009>

1. Matters concerning the method and period of a guarantee under Ar- ticle 28 (1) 2 and 3, and guarantee fee, etc., fees, and penalties under Articles 33, 33-2 and 34;
1-2. Matters concerning the reguarantee, such as method and period of
reguarantee, category of reguarantee-restricted business, etc.;
1-3. Matters concerning guarantee for SPC in the following items: (a) Debts subject to guarantee;
(b) Assets subject to securitization; (c) Plan for managing risks; and
(d) Maximum limit of securitized assets that can be underwritten for
the same enterprise prescribed in Article 28-3 (2); and
2. Matters concerning discharge of guarantee liabilities;

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제22편 통화․국채․금융 기술신용보증기금법

3. Matters concerning exercise of the rights of indemnity;
4. Matters concerning the criteria, procedures, methods, types, etc. of the technology appraisal under the provisions of Article 28 (3); and
5. Other matters necessary for the performance of the Fund s business operations.

Article 30 (Criteria of Guarantee)

(1) The Fund shall extend guarantees after a fair and objective survey of the business prospect and managerial capability of the enterprises is completed and deemed satisfactory.
(2) The Fund shall make 3/4 or more of the total amount of guarantee a technology credit guarantee. <Amended by Act No. 6705, Aug. 26, 2002>

Article 31 (Ceiling of Guarantee, etc.)

(1) The ceiling of the aggregate of outstanding guarantee and re-guar- antee issued by the Fund shall be prescribed by Presidential Decree, within the limit of 20 times the sum of the fundamental property of the Fund and the profits brought forward. <AmendedbyActNo.4955,Aug.4,1995;

Act No. 5701, Jan. 29, 1999; Act No. 6705, Aug. 26, 2002>

(2) The maximum amount of guarantee or reguarantee which the Fund may extend to the same enterprise shall be prescribed by Presidential Decree. <Amended by Act No. 4955, Aug. 4, 1995>
(3) The Fund may guarantee the liabilities of a new technology enter-
prise to the extent determined by the Financial Services Commission.

<AmendedbyActNo.4955,Aug.4,1995;ActNo.5701,Jan.29,1999;ActNo.8863,Feb.

29, 2008>

Article 32 (Operational Program)

(1) The Fund shall prepare an operational program for each business year, upon the resolution of the board of policy and obtain approval of the Financial Services Commission. <Amended by Act No. 4955, Aug. 4, 1995; Act

No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008>

(2) The Fund shall submit the operational program to the Financial Services Commission for its approval as provided for in paragraph (1), at least one month prior to the commencement of each business year. <Amended

by Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008> (3) Any revision of the operational program shall be made upon the res- olution of the board of policy and subject to approval of the Financial Services Commission. <Amended by Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan. 29, 1999;

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

Act No. 8863, Feb. 29, 2008>

(4) Deleted. <by Act No. 6705, Aug. 26, 2002>

Article 33 (Guarantee Fee, etc.)

(1) The Fund shall charge a guaranteed enterprise a guarantee fee with regard to the amount of the guarantee, taking into consideration the credit rating of the enterprise concerned in accordance with Presidential Decree. In such cases, where a new technology enterprise which has been given a technology credit guarantee achieves remarkable business performance, the Fund may collect a performance-based guarantee fee from such enter- prise according to a separate agreement under Presidential Decree. <Amended

by Act No. 4955, Aug. 4, 1995>

(2) Where the Fund s obligation as guarantor has not been relinquished due to the guaranteed enterprise s failure to discharge its liability by the date of maturity, the Fund is entitled to collect an additional guarantee fee from the enterprise concerned with regard to the amount in default in accordance with Presidential Decree. <AmendedbyActNo.4955,Aug.4,1995> (3) Where the guaranteed enterprise fails to pay the guarantee fee by the date of maturity, the Fund may collect an overdue charge from the enter- prise concerned in accordance with Presidential Decree. <AmendedbyAct

No. 4955, Aug. 4, 1995>

(4) The Fund shall charge the enterprises which have been given a reguar- antee a reguarantee fee with regard to the amount of reguarantee in accord- ance with Presidential Decree. <Newly Inserted by Act No. 4955, Aug. 4, 1995>

Article 33-2 (Fees)

The Fund may receive the fees in performing the businesses under Article
28 (1) 4, 5, 5-2 and 8 under conditions prescribed by Presidential Decree.

<Amended by Act No. 9456, Feb. 6, 2009>

[This Article Newly Inserted by Act No. 6705, Aug. 26, 2002]

Article 34 (Penalties)

Where the Fund has paid a guarantee liability, it may collect from the enterprise concerned a penalty calculated at a rate not exceeding 25/100 per annum of the amount paid by the Fund, in accordance with Presidential Decree.

Article 35 (Formation of Guarantee Relationships)

(1) Where the Fund has decided to stand guarantee for an enterprise, it shall give notice to that effect to the enterprise concerned and to the

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제22편 통화․국채․금융 기술신용보증기금법

person who is to be a creditor of the enterprise: Provided, That where
the Fund guarantees debts borne by an SPC following issuance of securitized bonds as provided in Article 28-3 (1) 1, it need not give notice to the
underwriters of securitized bonds. <Amended by Act No. 9456, Feb. 6, 2009>
(2) The guarantee relationship of the Fund shall become enforceable only when a primary obligation comes into effect between the enterprise
concerned and its creditor following receipt of the notice under para- graph (1).
(3) The guarantee relationship shall take no effect, unless the primary
obligation is put into effect within 60 days from the date when the no- tice under paragraph (1) is given to the parties concerned.

Article 36 (Discharges of Guarantee Liability)

(1) The creditor may call upon the Fund to discharge its guarantee li- ability in any of the cases prescribed by Presidential Decree.
(2) Upon receipt of the request for the discharging of its guarantee li-
ability as provided for in paragraph (1), the Fund shall pay off the pri- mary liability involved, together with any incidental liabilities prescribed
by Presidential Decree.

Article 37 (Exercise of Right to Indemnity)

(1) Where the Fund discharges its guarantee liability, the Fund may exercise the right to indemnity.
(2) Where the Fund has discharged its guarantee liability, the creditor concerned shall, without delay, deliver to the Fund such documents as
may be necessary to the Fund in exercising its right to indemnity arising
therefrom, and fully cooperate with the Fund in exercising such right. (3) The Fund may, if the enterprise whose guarantee liability has been
discharged by the Fund falls under any of the following subparagraphs,
suspend the exercise of the right to indemnity through the resolution of the board of directors:
1. Where it is deemed improbable that the property of the enterprise will,
after being appropriated for the expenses incidental to the exercise of right to indemnity, still leave a balance; and
2. Where it is deemed probable that the debt-servicing ability of the
enterprise will be enhanced by the suspension of the exercise of right to indemnity.
(4) Where the Fund has suspended the exercise of its right to indem-

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

nity according to the provisions of paragraph (3) 2, it may dispatch its
officers or employees of the Fund to the enterprise concerned to participate in the management thereof.

Article 37-2 (Selling of Claim for Indemnity)

When the Fund deems it necessary for a smooth recovery and manage- ment of the claim for indemnity, it may sell such claim for indemnity to a person falling under any of the following subparagraphs, by going through a resolution of the board of directors: <Amended by Act No. 7884,

Mar. 24, 2006; Act No. 9584, Apr. 1, 2009>

1. Corporate restructuring investment company under the Corporate
Restructuring Investment Companies Act;
2. Corporate restructuring association registered under Article 15 of the
Industrial Development Act (which has been valid before the wholly amended Industrial Development Act (Act No. 9584) takes effect);
and
3. Other persons specialized in the trade and management of the insol- vent loans, who are prescribed by Presidential Decree.

[This Article Newly Inserted by Act No. 6705, Aug. 26, 2002]

Article 38 (Duties of Creditor)

In case of falling under any of the following subparagraphs, a creditor prescribed by Presidential Decree shall give the Fund immediate notice to that effect:
1. Where the primary obligation has come into effect;
2. Where the liability involved has been in part or wholly extinguished;
3. Where the debtor concerned has forfeited the benefit of the term;
4. Where the debtor concerned has defaulted his liability; or
5. Where other events which may affect the guarantee liability have
occurred.

Article 39 (Restriction on Guarantee)

The Fund may not grant a guarantee to enterprises which fall under any of the following subparagraphs (excluding the guarantee to replace a pre- vious one) within three years from the date the Fund discharges its guarantee liability: Provided, That the above restriction shall not apply where the Fund suspends exercising its right to indemnity under Article 37 (3) 2 or gives a guarantee in order to secure its indemnity upon the resolution of the board of directors:

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1. An enterprise which has failed to meet the indemnities of the Fund;
and
2. An enterprise which is operated or represented by the directors, or the managing partners of such an enterprise as described in subpara- graph 1 and prescribed by Presidential Decree.

Article 40 (Principles for Accounting)

(1) The accounting of the Fund shall be based on Korean Financial Ac- counting Standards.
(2) The fundamental property of the Fund shall, in the accounting, be
deemed to be its capital.

Article 41 (Fiscal Year)

The fiscal year of the Fund shall correspond to that of the Government.

Article 42 (Budget)

(1) The Fund shall compile a budget indicating income and expenditure of each business year, and it shall, upon the resolution of the board of policy, obtain approval therefor from the Financial Services Commission.

<AmendedbyActNo.4955,Aug.4,1995;ActNo.5701,Jan.29,1999;ActNo.8863,Feb.

29, 2008>

(2) If the Fund intends to obtain the approval under paragraph (1), it shall submit a draft budget to the Financial Services Commission, at least one month prior to the commencement of each fiscal year. <Amended by

Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008> (3) If the Fund intends to revise its budget, it shall obtain approval therefor from the Financial Services Commission through the resolution of the board of policy. <Amended by Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan. 29,

1999; Act No. 8863, Feb. 29, 2008>

Article 43 (Settlement of Accounts)

The Fund shall prepare a statement of accounts, a balance sheet, an income statement and a statement of fundamental property for each business year, and submit them to the Financial Services Commission, upon the resolution of the board of policy, within two months following the end of each business year. <AmendedbyActNo.4955,Aug.4,1995;ActNo.5701,Jan.

29, 1999; Act No. 8863, Feb. 29, 2008>

Article 44 (Utilization of Reserve Funds)

Extra moneys comprising the fundamental property which is not cap- ital necessary for the management of business shall be administered in

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

a manner falling under each of the following subparagraphs: Provided,
That in cases under subparagraphs 3 and 4, approval of the Financial
Services Commission shall be granted: <Amended by Act No. 4955, Aug. 4,

1995; Act No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008>

1. Deposit with a financial institution;
2. Purchase of state bonds, local government bonds and other bonds guaranteed by the Government, local governments or financial institu- tions;
3. Subscription or purchase of stocks (including investment certificates),
debentures or other securities; and
4. Other manners necessary to achieve the purposes of the Fund.

Article 45 (Coverage of Loss)

(1) When there has arisen any gross revenue at the book-closing of the
Fund, its entire amount shall be reserved.
(2) When there has arisen any loss at the book-closing of the Fund, it shall be covered by the reserve under paragraph (1), and when such reserve is insufficient, the Government shall cover it. <AmendedbyActNo.

9456, Feb. 6, 2009>

[This Article Wholly Amended by Act No. 6705, Aug. 26, 2002]

CHAPTER Ⅳ SUPPLEMENTARY PROVISIONS

Article 46 (Supervision)

(1) Deleted. <by Act No. 5374, Aug. 28, 1997>
(2) The Financial Services Commission may supervise the businesses of the Fund and issue such orders as deemed necessary for the supervision to the Fund. <Amended by Act No. 4955, Aug. 4, 1995; Act No. 5701, Jan. 29, 1999;

Act No. 8863, Feb. 29, 2008>

Article 47 (Report and Inspection)

(1) The Financial Services Commission may, if it is deemed necessary for achieving the purposes of the Fund, request the Fund, financial in- stitutions entrusted by the Fund with the businesses (hereafter re- ferred to as trustee in this Article), or finance companies, etc. making contributions to the Fund, to submit reports, or have the public officials belonging to the Financial Services Commission engage in inspecting the status of operations, books and documents or other necessary matters:

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제22편 통화․국채․금융 기술신용보증기금법

Provided, That with regard to the trustees, such reporting or inspection

shall be limited only to the entrusted duties, and with regard to the finance companies, etc. making contributions to the Fund, such reporting or in-
spection shall be limited only to the matters relating to the contribution.

<AmendedbyActNo.4955,Aug.4,1995;ActNo.5701,Jan.29,1999;ActNo.6705,Aug.

26, 2002; Act No. 8863, Feb. 29, 2008>

(2) The Financial Services Commission may entrust the Governor of the Financial Supervisory Service with the inspection provided for in para- graph (1). <AmendedbyActNo.4955,Aug.4,1995;ActNo.5505,Jan.13,1998; Act

No. 5701, Jan. 29, 1999; Act No. 8863, Feb. 29, 2008>

(3) Any person who engages in inspection according to paragraphs (1) and (2) shall carry a certificate as evidence of its power to inspect, and show such certificate to the relevant persons.

Article 47-2 (Entrustment of Duties)

(1) The Fund may, under conditions prescribed by Presidential Decree, entrust a part of its duties to financial institutions, the Korea Asset
Management Corporation under the Act on the Efficient Disposal of
Non-Performing Assets, etc. of Financial Institutions and the Establishment of the Korea Asset Management Corporation, or credit information dealers
under the Use and Protection of Credit Information Act (hereafter in this
Article referred to as the credit information dealers ). <Amended by Act

No. 7884, Mar. 24, 2006>

(2) Any person entrusted with the duties under the provisions of par- agraph (1) may conduct the acts in or outside of all trials with regard to the duties in substitution of the Fund: Provided, That with regard to the credit information dealers, it shall be limited only to the acts out- side of the trial.

[This Article Newly Inserted by Act No. 6705, Aug. 26, 2002]

Article 48 (Liability for Damage, etc.)

(1) If any officer of the Fund has caused any damage to the Fund due to contravention of Acts and subordinate statutes or its articles of in- corporation, or negligence of duties, he/she shall be jointly and severally liable to the Fund for the resultant damage.
(2) If any person engaged in guarantee business of the Fund has inten- tionally or by gross negligence inflicted damage on the Fund in con- nection with his/her business, he/she shall be liable for such damage.

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

In this case, such liability may be reduced unless the damage is caused
by intention.

Article 49 (Prohibition of Use of Similar Name)

No person except the Fund under this Act shall use the name Korea Tech- nology Credit Guarantee Fund or any other name similar thereto.

Article 50 (Request, etc. for Supply of Data)

(1) The Fund may request the State, local governments, the National Pension Service under the National Pension Act, the National Health Insurance Corporation under the National Health Insurance Act, the Korea Workers Compensation and Welfare Service under the Industrial Accident Compensation Insurance Act, and other public organizations prescribed by Presidential Decree to supply data necessary for the performance of the businesses referred to in Article 28 (1) 2 through 5, 5-2, and 6 through
8. <Amended by Act No. 8541, Jul. 23, 2007; Act No. 9456, Feb. 6, 2009>
(2) The Fund may request enterprises for cooperation to efficiently manage the overall credit information under Article 28 (1) 5. <Newly Inserted by

Act No. 9456, Feb. 6, 2009>

(3) The party who has been requested to supply or cooperate with data
under paragraphs (1) and (2) shall comply with it unless there exists any special ground to the contrary. <Amended by Act No. 9456, Feb. 6, 2009>

[This Article Newly Inserted by Act No. 7884, Mar. 24, 2006]

CHAPTER Ⅴ PENAL PROVISIONS

Article 51 (Penal Provisions)

(1) Any person who has divulged secrets in violation of Article 24 (2) shall be punished by imprisonment of not more than two years, or a fine not exceeding ten million won.
(2) Any person who has violated Article 49 shall be punished by a fine not exceeding five million won.

[This Article Wholly Amended by Act No. 9456, Feb. 6, 2009]

ADDENDA

Article 1 (Enforcement Date)

This Act shall come into force on April 1, 1989.

Article 2 (Preparations for Establishment)

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제22편 통화․국채․금융 기술신용보증기금법

(1) The Minister of Finance may entrust a Committee for Establishment
to perform affairs relating to the establishment of the Fund before the enforcement date of this Act.
(2) A member of the Committee for Establishment entrusted under the provisions of paragraph (1) shall immediately prepare the articles of in- corporation and obtain authorization from the Minister of Finance and Economy. In this case, where it has obtained such authorization of the Minister of Finance and Economy, it shall be deemed that the resolution of the board of policy according to the provisions of Article 15 (1) has been adopted.
(3) A member of the Committee for Establishment shall complete a reg- istration according to Article 16 upon the authorization under para- graph (2).
(4) A member of the Committee for Establishment shall, upon completing the registration under paragraph (3), without delay, transfer its business to the President of the Fund.

Article 3 (Succession to Property, Rights and Duties)

(1) The property, rights and duties vested in the technology credit guar- antee fund established under the previous provisions, at the time when this Act enters into force shall be taken over as a whole by the Fund under this Act.
(2) The property taken over by the Fund under the provisions of par- agraph (1) shall be deemed to be its fundamental property as provided for in Article 13.

Article 4 (Transitional Measures concerning Legal Act, etc. under Previous

Provision)

Contributions toward the Korea Technology Credit Guarantee Fund, the issuance of guarantees and other legal acts already put into effect under the previous provisions, at the time when this Act enters into force, shall be deemed to have been made effective under the provisions of this Act.

ADDENDA <Act No. 4541, Mar. 6, 1993>

Article 1 (Enforcement Date)

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

Articles 2 through 5 Omitted.

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

ADDENDUM <Act No. 4955, Aug. 4, 1995>

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

ADDENDUM <Act No. 5188, Dec. 30, 1996>

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

ADDENDA <Act No. 5374, Aug. 28, 1997>

Article 1 (Enforcement Date)

This Act shall enter into force on January 1, 1998.

Articles 2 through 7 Omitted.

ADDENDA <Act No. 5403, Aug. 30, 1997>

Article 1 (Enforcement Date)

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

Articles 2 through 8 Omitted.

ADDENDA <Act No. 5505, Jan. 13, 1998>

(1) (Enforcement Date) This Act shall enter into force on April 1, 1998. (Proviso Omitted.)
(2) (Transitional Measures concerning Dispositions) At the time of the
entry into force of this Act, authorization or other actions taken by adminis- trative agencies, or various reports or other actions submitted to admin-
istrative agencies under the previous provisions, shall be deemed to be actions
taken by or submitted to administrative agencies under this Act.
(3) (Transitional Measures concerning Term of Office of Auditor) At the time of the entry into force of this Act, the term of office of the auditor
of the Korea Technology Credit Guarantee Fund, the Credit Guarantee
Fund, the Korea Long-term Credit Bank, or the Export-Import Bank of
Korea shall be …<Omitted.>… two years, notwithstanding the amended provisions.
(4) and (5) Omitted.

ADDENDUM <Act No. 5701, Jan. 29, 1999>

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

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제22편 통화․국채․금융 기술신용보증기금법

ADDENDA <Act No. 6022, Sep. 7, 1999>

Article 1 (Enforcement Date)

This Act shall enter into force on March 1, 2000.

Articles 2 and 3 Omitted.

ADDENDA <Act No. 6705, Aug. 26, 2002>

Article 1 (Enforcement Date)

This Act shall enter into force three months after the date of its prom-
ulgation.

Article 2 (Applicability to Composition of Board of Policy)

The amendments to Article 17 (2) 2-2, 5 and 7 shall apply from the mem-
bers first nominated or commissioned under the same amendments after
this Act enters into force.

Article 3 (Transitional Measures concerning Technology Credit Guarantee) In case where a general credit guarantee before the enforcement of this Act falls under the requirement for the technology credit guarantee after the enforcement of this Act, it shall be regarded as the technology credit guarantee.

Article 4 Omitted.

ADDENDUM <Act No. 7884, Mar. 24, 2006>

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

ADDENDA <Act No. 8541, Jul. 23, 2007>

Article 1 (Enforcement Date)

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

Articles 2 through 43 Omitted.

ADDENDA <Act No. 8635, Aug. 3, 2007>

Article 1 (Enforcement Date)

This Act shall enter into force one and half year after the date of its prom-
ulgation. (Proviso Omitted.)

Articles 2 through 44 Omitted.

ADDENDA <Act No. 8852, Feb. 29, 2008>

Article 1 (Enforcement Date)

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KOREA TECHNOLOGY CREDIT GUARANTEE FUND ACT

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

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.

ADDENDUM <Act No. 9456, Feb. 6, 2009>

This Act shall enter into force three months after the date of its promul- gation.

ADDENDA <Act No. 9584, Apr. 1, 2009>

Article 1 (Enforcement Date)

This Act shall enter into force on May 8, 2009.

Articles 2 through 6 Omitted.

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