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ENFORCEMENT DECREE OF RESTITUTION OF DEVELOPMENT GAINS ACT

Ministry of Land, Transport and Maritime Affairs (Land Policy Division) 02-2110-8280 Article 1 (Purpose)

The purpose of this Decree is to provide for the matters delegated by the Restitution of Development Gains Act and the matters necessary for the enforcement thereof. Article 2 (Increases in Normal Land Prices)

(1) Increases in normal land prices pursuant to Article 2, Subparagraph 3 of the Restitution of Development Gains Act (hereinafter referred to as the "Act") shall be calculated by adding together every year's increases in normal land prices of the imposing period, which is calculated to multiply the current land price as of January 1 of the corresponding year by the fluctuation rate of normal land price (2) In the event that the imposing period is within one year (including commencement point and termination point pertaining to the year), monthly increases in normal land prices (increases in normal land prices in every month are calculated to multiply the current land price as of the first date in the corresponding month, by the fluctuation rate of normal land price in the corresponding month) shall be calculated by adding together every month's increases in normal land prices of the imposing period, of which increases in normal land prices in the partial period of the month shall be calculated from the amount where the increases in normal land prices of the month divided by the days of the corresponding month.

(3) The current land price as of January 1 in the corresponding year after the second year of the imposing period pursuant to Paragraph (1) shall be the amount of the land price in commencing-point imposition or the current land price as of January 1 of the corresponding year by adding together the increases in normal land prices of the imposing period of the previous year.

(4) The fluctuation rate of normal land price shall be stipulated as the annual or monthly fluctuation rate of the average land price (referring to the average rate of fluctuation in land prices of the relevant City/Gun or autonomous Gu to the area pertaining to the relevant land; hereinafter the same shall apply) inspected by the Minister of Land, Transport and Maritime Affairs (hereinafter referred to as the "Minister") pursuant to Article 125 of the National Land Planning and Utilization Act: provided, that in the case of calculating increases in normal land prices pursuant to Article 12, Paragraph (1), Subparagraph 6, or Article 8, Paragraph (2) of Act, the higher between the annual fluctuation rate of average land price (referring to the average rate of imposing period pertaining to the corresponding year where the imposing period remains less than one year or the commencing-point imposition or termination-point imposition pertaining to the corresponding year is pertained in the corresponding year) and interest rate of regular deposit in the same period shall be applied. (5) Where the rate of interest in regular deposit pursuant to Paragraph (4) is applied, the annual rate of interest in regular deposit shall be stipulated as 6/100 and monthly rate of interest in regular deposit as 5/1000.

Article 3 (Distribution of Impositions, Etc)

(1) The local government to which the amount of 50/100 from Development Surcharges (hereinafter referred to as the "Charges") imposed pursuant to Article 3 of the Act are reverted shall be the special autonomous Do, City/Gun or autonomous Gu. (2) In the event that the special metropolitan city or the metropolitan city or Do (hereinafter referred to as the "City/Do") is liable to pay for expenses necessary for procurement of school sites pursuant to Article 4 of the Act on the Special Cases concerning the Procurement of School Sites, half of the surcharges to be reverted to local government, notwithstanding Paragraph (1), pursuant to Article 4 Paragraph (1) of the Act (in case the expenses to be borne by the City/Do is less than half of the surcharges to be reverted to local governments, referring to the expense to be borne by local governments) shall be reverted to City/Do and the other half shall be reverted to City/Gun or autonomous Gu.

(3) In the case of having received the surcharges as payment-in-kind pursuant to Article 18 Paragraph (2), the Minister may distribute the land used as payment-in-kind as the surcharges to be reverted to the special autonomous Do, City/Gun or autonomous Gu. (4) The special autonomous Do, City/Gun or autonomous Gu shall use the development surcharges reverted pursuant to the provisions of Paragraphs (1) through (3) to effectively proceed with land management and balanced regional development project of the corresponding special autonomous Do, City/Gun or autonomous Gu and, if necessary, special accounting of land management may be established as revenue sources of the development surcharges to be reverted as prescribed by the Municipal Ordinance.

Article 4 (Subject Projects)

(1) The scope of development project as an object of imposition for surcharges pursuant to Article 5 of the Act shall be provided in the annexed Table 1, and its scale shall be stipulated as the case that the land area (in case of correction of land area in the registered matters pursuant to Article 24 of the Act on Korea Cadastral Survey before termination-point imposition, referring to the corrected area) of the subject project obtained authorization, permission, and license etc. from the local governments (including reports, hereinafter referred to as the "authorization, etc.") falls under each of the following subparagraphs. In this case, the same person [including the spouse and lineal ascendant/descendant; hereinafter the same shall apply] implements a practically split development project with authorization, etc for the development project on the connective land [including a group of connected lands which the same person owns] within five years after a development project was completed, it shall be regarded as one development project implemented on the land in which the object land areas are added together:

1. Where the development project is implemented in an urban area of the special metropolitan city or the metropolitan city (excluding projects under Paragraph (3)): 660 square meters or more;

2. Where the development project is implemented in an area (excluding a project under Paragraph (3)) other than the urban area in subparagraph 1: 990 square meters or more;

3. Where a person who has owned land from the time of designation of the development restriction zone in urban areas implements the development project: 1,650 square meters or more; and

4. Where the development project is implemented in an area other than an urban area: 1,650 square meters or more.

(2) In the event that the development project is implemented simultaneously in more than two regions of the regions falling under each subparagraph of Paragraph (1), the land area of object imposition shall be calculated by the standards of each of the following subparagraphs:

1. 1 square meter in the region corresponding to Paragraph (1) Subparagraph 1 is regarded to be equivalent to 1.5 square meters in the region corresponding to the same Paragraph, Subparagraph 2, and further as 2.5 square meters in the region corresponding to the same Paragraph, Subparagraphs 3 and 4.

2. 1 square meter in the region corresponding to Paragraph (1) Subparagraph 2 is regarded to be equivalent to 5/3 square meters in the region corresponding to the same Paragraph, Subparagraphs 3 and 4

(3) In the event that the scale of the cooperative business complex development project pursuant to the Promotion of Small and Medium Enterprises and Encouragement of Purchase of Their Products Act is calculated, notwithstanding Paragraph (1), each development project is regarded to be implemented on the land areas (including the calculated area for common facilities site according to the portion of the respective small and medium entrepreneurs) of the respective small and medium entrepreneurs who have participated in the cooperative business complex development project. (4) In the event that the development project accompanied with a change of land category pursuant to subparagraph 9 in the annexed Table No.1, the scale of the surcharge- imposing object shall be prescribed, notwithstanding Paragraph (1), as the land area to be changed in fact or in official record with land category among the land area which obtained authorization, etc. from the State or Local Government corresponding to the provisions falling under each subparagraph of Paragraph (1). In this case, the land category with a piece of land having more than two usages in fact shall be prescribed by Article 6 of Enforcement Decree of the Act on Korea Cadastral Survey. Article 5 (Scope of Association, etc)

(1) Excluding that in Article 6, Paragraph (2), in each subparagraph of the Act, "Association determined by Presidential Decree" means the association falling under each of the following subparagraphs:

1. Housing association pursuant to Article 32 of the Housing Act

2. Association pursuant to Article 11, Paragraph (1), Subparagraph 6 of the Urban Development Act

3. Association of Urban Environmental Rearrangement Business pursuant to Article 16 of the Act on Designation and Management of Free Economic Zones (2) The development surcharges to be paid by the association members under Article 6, Paragraph (2) of the Act shall be the amount of surcharges and additional dues distributed to each association member according to the articles of association (3) For the imposition of surcharges to an association member pursuant to Paragraph (2), the notice of payment shall be issued pursuant to Article 19 and the due date for payment shall be prescribed within 30 days from the issuance of the notice of payment. Article 6 (Exclusion from Imposition and Reduction and/or Exemption) (1) "Development project determined by Presidential Decree" pursuant to Article 7, Paragraph (1) of the Act refers to projects falling under each of the following subparagraphs:

1. Housing site development project pursuant to subparagraph 1 of the annexed Table No.1 (including housing site preparation projects);

2. Industrial complex development business pursuant to subparagraph 2 of the annexed Table No.1;

3. Tourist facilities complex site development business pursuant to subparagraph 3 of the annexed Table No.1;

4. Urban environmental maintenance business pursuant to subparagraph 4 of the annexed Table No.1 (excluding in case of constructing factories);;

5. Distribution facilities site development business pursuant to subparagraph 5 of the annexed Table No.1; and

6. Urban development project pursuant to Urban Development Act among projects in subparagraph 10 of the annexed Table No.1, free economic zones development project pursuant to the Act on Designation and Management of Free Economic Zones, free international city development project pursuant to the Special Act on the Establishment of Jeju Special Self-Governing Province and the Development of Free International Cities, Pyeongtaek City development project and internationalization planning district development project pursuant to the Special Act on Support, etc for Pyeongtaek City on U.S. Military Base Relocation, and specialized projects pursuant to the Special Case Act on Regulation for Regional Specialized Development District. (2) The public institutions to be mitigated 50/100 of surcharge (hereinafter referred to as the "mitigation institutions") pursuant to Article 7, Paragraph (2), Subparagraph 2 of the Act shall be prescribed as institutes falling under each of the following subparagraphs.

1. Public institution falling under each of the following items among the public institutions pursuant to Act on the Management of Public Institutions: A. Korea National Housing Corporation established by the Act on Korea National Housing Corporation

B. Korea Water Resources Corporation established by the Act on Korea Water Resources Corporation

C. Korea Land Corporation established by the Act on Korea Land Corporation D. Korea Agricultural and Rural Infrastructure Corporation established by the Act on Korea Agricultural and Rural Infrastructure Corporation and Farmland Management Fund Act

E. Korea Tourism Organization established by the Act on Korea Tourism Organization F. Korea Railroad Corporation established by the Act on Korea Railroad Corporation

2. Local public corporations and local authorities established for the purpose of development projects pursuant to Paragraph (1) among local public corporations and local authorities established by the Act on Local Public Corporation.

3. Public corporations and associations in each of the following items among public corporations and associations pursuant to the Special Act: A. Small Business Corporation established by the Act on Promotion of Small & Medium Enterprises and Encouragement of Purchase of their Products Act, B. Korea Industrial Complex Corporation established by the Act on Industrial Cluster Development & Factory Establishment Act

C. Government Employees Pension Corporation established by the act on public official pension

D. Association and National Agricultural Cooperative Federation established by the Act on Agricultural Cooperative

E. National Fisheries Cooperatives and Federation established by the Act on Fisheries Cooperatives

F. National Forestry Cooperatives and Federation established by the Act on Forestry Cooperative

G. Korea Rail Network Authority and Federation established by the Act on Korea Rail Network Authority

H. Korea Transportation Safety Authority established by the Act on Korea Transportation Safety Authority

I. Korea Airports Corporation established by the Act on Korea Airports Corporation j. Korea Highway Corporation established by the Act on Korea Highway Corporation K. Incheon International Airport Corporation established by the Act on Incheon International Airport Corporation

L. Korea Container Terminal Authority established by the Act on Korea Container Terminal Authority

M. Small and Medium Enterprise Cooperatives established by the Act on Small and Medium Enterprise Cooperatives

N. Korea Asset Management Corporation established by the Act on the Efficient Disposal of Non-Performing Assets, etc. of Financial Institutions and the Establishment of Korea Asset Management Corporation

O. Korea Ports Corporation established by the Act on Korea Ports Corporation P. Development Center of Jeju Free International City established by the Special Act on the Establishment of Jeju Special Self-Governing Province and the Development of Free International Cities.

(3) The development projects to be mitigated 50/100 of the surcharge pursuant to Article 7, Paragraph (2) of the Act shall be prescribed as projects falling under each of the following subparagraphs.

1. Development projects under each Subparagraph of Paragraph (1);

2. Development projects of subway station areas and sites along the railroad that the Korea Rail Network Authority implements pursuant to Article 23 of the Act on Korea Rail Network Authority;

3. Development project of automobile-related facilities sites (limited to the case of the Korea Transportation Safety Authority implements pursuant to Act on Korea Transportation Safety Authority);

4. Installation project of total rice and cereal disposal plant that Agricultural Cooperative and National Agricultural Cooperative Federation implement pursuant to Article 22 of the Grain Management Act

5. Installation project of container terminal function facilities that the Korea Container Terminal Authority implements pursuant to Act on Korea Container Terminal Authority, Article 7;

6. Establishment, reconstruction, maintenance, repair and dredging projects of port facilities that the Korea Ports Corporation implements pursuant to Article 8, Paragraph (1), Subparagraph 1 of the Act on Korea Ports Corporation;

7. Development projects of station facilities subway station areas that the Korea Railroad Corporation implements pursuant to Article 9, Paragraph (1), Subparagraphs 5 and 6 of the Act on Korea Railroad Corporation and Article 13 of the same Act. (4) In the main contents of Article 7, Paragraph (2), Subparagraph 3 of the Act, the "lot development projects of distribution facilities prescribed by Presidential Decree" means the lot development projects of distribution facilities according to subparagraph 5 of the annexed Table No. 1.

Article 6-2 (Reason for Exemption from Reduction) In the latter part of Article 7, Paragraph (4) of the Act, the "reason for the concern of rapid increase of land price of the corresponding local government prescribed by Presidential Decree" means cases falling under all of the following subparagraphs:

1. Where the increased rate of land price of the Local Government prior to the request of reduction is higher than 130/100 of the national consumer price inflation rate; and

2. Where the increased rate of land price of the Local Government in monthly average during the two months retroactively applied from the previous month is higher than 130/100 of the national consumer price inflation rate. [Newly Inserted by Enforcement Decree No. 21558, Jun. 25, 2009] Article 6-3 (Reduction Object, Standard and Reduction Procedure) (1) The head of the local government pursuant to Article 7, Paragraph (4) of the Act shall prescribe the reduction standard to the development projects falling under each subparagraph of Article 5, Paragraph (1) of the Act and shall request the reduction of development surcharges to the Minister. In this case, the head of the local government may prescribe different reduction rates and reduction periods according to the specified conditions of an obligor of payment for development surcharges pursuant to Article 6 of the Act, types of development projects and specific use district/area of lands of which the development project is implemented.

(2) When requesting for the reduction of development surcharges, the head of the local government shall prepare a written application, on which the reduction standard and reasons making such reduction necessary prescribed by Paragraph (1) are explained, therewith attached certified documents of approval from the local-council and certified documents of reasons for exemption from reduction according to Article 6 Paragraph (2), and submit it to the Minister.

(3) Where there are no corresponding reasons as provided in Article 6, Paragraph (2) in the local government which requested the reduction, the Minister shall make a public notification of the reduction projects for development surcharges of the corresponding local government and reduction standards, and shall notify this fact to the local government.

(4) The head of the local government shall make arrangements to enable public citizens to peruse the reduction projects for development surcharges and the standards of reduction pursuant to Paragraph (3).

[Newly Inserted by Enforcement Decree No. 21558, Jun. 25, 2009] Article 7 (Modification of Land Use Plan, etc.)

(1) Where the "land-use plan, etc. as determined by Presidential Decree is modified," in the main sentence of Article 9, Paragraph (1), Subparagraph 1 of the Act means that the land of which the development project is implemented, is appointed or modified as a specific use district/area of the annexed Table No. 2, or cancelled to be appointed as a specific use district/area on the land: provided, that this shall not apply when restoring the specific use district/area as its original specific use district/area at that time of acquisition of the land.

(2) Where the land-use plan, etc. is modified more than two times when Paragraph (1) is applied, the initially performed modification within five years before obtaining the authorization, etc. shall be regarded as the modification of the land-use plan, etc. pursuant to Paragraph (1).

Article 8 (Exception of Commencement-Point of Imposition) (1) "In case where determined by Presidential Decree" and "the date determined by Presidential Decree" in the proviso of Article 9, Paragraph (1), Subparagraph 1 of the Act shall fall under each of the following subparagraphs:

1. Where the land-use plan, etc. are modified more than two years since the date of acquisition of the land, the day prior to two years of the modified date shall be effective; and

2. Where the land-use plan, etc. are modified after small and medium entrepreneurs acquired the land to develop factory sites pursuant to Article 2 of the Framework Act on Small and Medium Enterprises, the modified date of the land-use plan, etc. shall be be effective.

(2) Commencement point of imposition on the newly inserted land to the object land of imposition due to the modification of the authorization etc. pursuant to Article 9, Paragraph (1) Subparagraph 2 of the Act, shall be applicable on the date prescribed by each of the following subparagraphs:

1. Where the land-use plan, etc. are modified pursuant to Article 7 of the Act before obtaining authorization, etc. of modification, the land acquired before the modification of the land-use plan, etc, shall be applicable on the corresponding date of acquisition or the corresponding date pursuant to Paragraph (1), Subparagraphs 1 and 2;

2. Where the land-use plan, etc. are modified pursuant to Article 7 of the Act before obtaining authorization, etc. of modification, the land acquired on the period from the date of the modification of the land-use plan, etc., to the date before obtaining authorization, etc. of modification shall be applicable on the date of acquisition; and

3. Where the lands other than that of Paragraphs (1) and (2) shall be applicable on the modified date of the authorization etc.

Article 9 (Authorization Date, Etc of Development Project) (1) The date on which authorization etc. of the development project was obtained pursuant to Article 9, Paragraph (2) of the Act and the date on which authorization etc. of completion was obtained pursuant to Article 9, Paragraph (4) of the Act shall be provided as in the annexed Table No. 3.

(2) The date of acquisition pursuant to Article 9, Paragraph (2) of the Act shall be applied mutatis mutandis to Article 162 of the Enforcement Decree of Income Tax Act. (3) In the event that the date on which authorization etc. of completion as a termination point of imposition was obtained pursuant to Article 9, Paragraph (3) of the Act is not prescribed by the relevant laws and regulations, the date falling under each of the following subparagraphs shall be applied as the termination point of imposition:

1. Where an obligor of payment reports the actual completion date of the development project therewith attached certified document of evidence to the Minister, the date on which evidence of completion for the development project shall be effective; and

2. Where an obligor for payment neither reports the actual completion date of development project nor can prove this date, the date that the Minister confirmed the current sites and notified as the completion date of development project to the obligor of payment shall be effective.

Article 10 (Termination Point of Imposition Before Completion of Development Projects)

(1) The "determined by Presidential Decree" pursuant to Article 9, Paragraph (3), Subparagraph 2 of the Act shall fall under the provisions of any of the following subparagraphs:

1. Where only land is developed, the case falling under any of the following items; A. Where land, which has actually completed development, is transferred to others. B. Where commencing the use of land such as constructing buildings, etc. on the land which has practically completed development,

2. In the case of development projects together with the construction of buildings and land development for housing construction projects, etc, when commencing the use of buildings after obtaining approval from the respective administrative agencies. (2) In case where the termination point of imposition in development surcharges pursuant to Paragraph (1) applies to the provision under each of the following subparagraphs:

1. For the transfer of land to others pursuant to Paragraph (1), Subparagraph 1, Item A, the date of the period corresponding to Article 162 of the Enforcement Decree of Income Tax Act;

2. For the commencement of land use pursuant to Paragraph (1), Subparagraph 1, Item B, the notifying date of commencement of construction work pursuant to Article 21, the Building Act;

3. For the commencement of building use pursuant to Paragraph (1), Subparagraph 2, the approval date for interim use pursuant to Article 22, the Building Act. (3) "Other cases as determined by Presidential Decree" pursuant to Article 9, Paragraph (3), Subparagraph 3 of the Act shall be when reasons falling under each of the following subparagraphs occur after implementation of the development project:

1. Where the authorization, etc. of development project is cancelled pursuant to provisions prescribed by the corresponding laws and regulations,

2. Where the development project is suspended and cannot be completed due to bankruptcy or other reasons on part of the project contractor, (4) The area of land, which the corresponding project in Paragraph (1) is regarded to be completed prior to obtaining the completion authorization of the development project, shall be determined by Ordinance of the Ministry of Land, Transport and Maritime Affair.

Article 11 (Calculation of Land Prices)

(1) The "determined by Presidential Decree" pursuant to Article 10, Paragraph (2) of the Act shall refer to the provisions of each of the following subparagraphs:

1. Where the sales prices of houses are determined through the approval of the head of the City/Gun pursuant to Article 38, Paragraph (1), Subparagraph 1 of the Housing Act (limited to a where the sales price of the housing unit is determined by applying the building costs pursuant to Paragraph (3), Subparagraph 1);

2. Where the Minister or the head of the Local Government approves the supplying condition of land developed by the main entities of the project pursuant to Article 16, Paragraph (1) of the Housing Act and Article 15 Paragraph (5) of the same Act;

3. Where the Minister or the head of the Local Government approves the housing site development implementation plan including the method for determining the supply price of housing sites pursuant to Article 9 of the Housing Site Development Promotion Act and Article 8 of the Enforcement Decree of the same Act;

4. Where the sales price of the land developed pursuant to Article 38 of the Industrial Sites and Development Act and Article 40 of the Enforcement Decree of the same Act is determined;

5. Where the sales price of the land developed as a special zone developing project pursuant to Article 39 of the Industrial Sites and Development Act and Article 40 of the Enforcement Decree of the same Act is determined;

6. Where the sales price of the land in which the Korea Land Corporation purchased and developed is determined pursuant to Article 23 of the Act on Korea Land Corporation; and

7. Where the sales price is determined by the authorization of the state or local governments similarly as that of Paragraphs 1 through 6. (2) In case where the disposal price pursuant to Article 10, Paragraph (2) of the Act is calculated to be the termination pointed land price, it shall be limited to the case where the purchase price pursuant to the proviso in Article 10, Paragraph (3) of the Act is calculated to be the commencement pointed land price. (3) In case where the disposal price pursuant to Article 10, Paragraph (2) of the Act is calculated to be the termination pointed land price, the disposal price shall be equivalent to the amount in which the amounts under each of the following subparagraphs is subtracted from sales price of land; provided that, when the obligor of payment submitted specifications of construction costs paid for the construction work by contract with the registered contractor pursuant to Framework Act on the Construction Industry, the disposal price may be equivalent to the amount in which the amounts of the construction cost and the expenses in Paragraph (2) are subtracted from the sales price:

1. Construction cost determined and publically announced by the Minister.

2. Expenses prescribed by Ordinance of the Ministry of Land, Transport and Maritime Affairs as a construction-related incidental cost.

3. The installation cost of underground parking lot.

4. Expenses of excessive development in case of excessive development of underground levels which is subject to be developed according to the Building Act, etc. and relevant laws and regulations.

(4) In the case of being notified of the authorization, etc on the development project from the relevant administration office pursuant to Article 25 of the Act, the Minister shall inspect the imposition object land with no delay and calculate the land price at the commencement point.

(5) "Cases determined by Presidential Decree" in the provision of Article 10, Paragraph (3), Subparagraph 5 of the Act refers to the cases falling under any of following subparagraphs.

1. Where the purchase of the land was performed before the commencement point of imposition (including the case that purchase and sale contract has been made before commencement point of imposition and the price of purchase and sale was paid completely as agreed after commencement point of imposition and the certified document prescribed by Ordinance of the Ministry of Land, Transport and Maritime Affairs has been already submitted) and where the purchase and sale price became the basis for acquisition tax and registration tax; and

2. Where the project implementer is a juristic person pursuant to the provision of Articles 286 through 288 of the Local Tax Act and the purchase price is a price recorded on the ledger of the juristic person.

(6) In case where an obligor of payment purchased the land and the building affixed on the land together and the distinction between the land price and building price in actual purchase price or acquisition price is obscure when the actual purchase price or acquisition price is regarded as the commencement point land price pursuant to the proviso excluding those than seen in each Subparagraph of Article 10, Paragraph (3) of the Act, the equivalent value which is equally divided and calculated pursuant to Article 48-2, Paragraph (4) of the Enforcement Decree of the Value-Added Tax Act shall be the purchase price or acquisition price of the land. (7) "Cases determined by Presidential Decree" in the provision of Article 10, Paragraph (5) of the Act refers to the case falling under any of the following subparagraphs:

1. When no officially assessed individual land price of the object land of imposition when it comes to calculation of commencement point land price and termination point land price; and

2. Where the commencement point land price is calculated by the purchase price pursuant to the proviso in Article 10, Paragraph (3) of the Act when it comes to calculation of termination point land price.

Article 12 (Calculation of Development Expense)

(1) The standard of calculation of development expense pursuant to each Subparagraph of Article 11, Paragraph (1) of Act shall be prescribed as each of the following subparagraphs.

1. Net construction expenses The sum of material costs, labor costs, expenses and dues and taxes paid for the corresponding development project

2. Inspection cost The sum of expenses such as the measurement costs and other expenses of inspection for direct implementation of the corresponding development project, excluding net construction expenses;

3. Design costs Expenses paid for design of the corresponding development project.

4. General management expense The sum of all expenses occurring in the field of management activity related to the corresponding development project.

5. Other expenses: Sum of indemnity for building, trees or right of business in development project zone, which is not included in the land price, and surcharges paid to the state or local government pursuant to the provisions of other laws and regulations and authorization condition, etc. In this case, the equivalent value for the building to be demolished is included in the indemnity for the building, etc. to implement the corresponding development project and the equivalent value for building shall be prescribed as any of following items:

A. For the purchased building to implement the development project: actual purchased price which is the basis for acquisition tax and registration tax; and B. For the building possessed in the past: standard current price pursuant to Article 111, Paragraph (2) of the Local Tax Act, but if there is no standard current price or the obligor of payment so wishes, the equivalent value which is appraised and assessed by the juristic person of appraisal and assessment appointed by the Minister.

6. The equivalent value of public facilities and the land, etc. which the obligor of payment contributes to the state or local government (in the case where the purpose of the development is to make a disposition of sales to others and the equivalent value of public facilities and the land, etc. is included in the disposition price, it is limited to where the disposition price shall be calculated as termination pointed land price pursuant to Article 11, Paragraph (2)).

The equivalent value of public facilities, etc. shall be the sum of the equivalent value of land with the prime cost of formation, and the equivalent value of land shall be the sum of commencement point land price with the increased portion in normal land prices.

7. Land amelioration cost The expense paid to improve the object land of imposition prior to commencement of the development project which is not applied for commencement point land price. (2) The development cost pursuant to Article 11, Paragraph (1) of Act is the sum of development costs falling under each subparagraph of Paragraph (1) which are paid by the obligor of payment in relation to the implementation of the corresponding projects in which specifications of calculation and certified documents are presented: provided, that the general management cost in Paragraph (1), Subparagraph 4 shall be prescribed as the amount calculated by the applicable standard of determination of estimate price and the rate pursuant to Article 9 of the Enforcement Decree of the Act on Contracts to Which the State is a Party and Article 10 of the Enforcement Decree of the Act on Contracts to Which the Local government is a Party. (3) In the event that the development costs from Paragraphs (1), Subparagraphs 1 through 3 in the amounts which the obligor of payment submitted in the main part of Paragraph (2) are in excess of the amount calculated by the standard falling under any of following subparagraphs, the excess amounts shall not be regarded as the development costs pursuant to Article 11, Paragraph (1) of the Act.

1. Material costs, labor costs and expenses shall be calculated by applying the calculation method of material costs, labor costs and expenses for calculation of construction prime cost in the determination standard of estimated price pursuant to Article 9 of the Enforcement Decree of the Act on Contracts to Which the State is a Party and Article 10 of the Enforcement Decree of the Act on Contracts to Which the Local government is a Party, and the amount shall be subject to Government Guaranteed Standard Estimating System and unit price (in the case of the government-set official price, referring to the price);

2. Inspection costs and design costs shall be the amount calculated according to the engineering business payment standards pursuant to Article 10 of the Engineering Technology Promotion Act.

(4) In the event that the development costs which the obligor of payment submitted are in excess of the amount pursuant to Paragraph (3) and it is a case falling under any of following subparagraphs, notwithstanding Paragraph (3), the amount shall be deemed to be acknowledged as development costs pursuant to Article 11 of the Act.

1. The development costs paid by the local government or reduction and/or exemption authority pursuant to the Local Finance Act or Act on the Management by Public Agencies;

2. The development costs, where the Minister has confirmed that the development costs submitted by the obligor of payment is appropriate for standards falling under following any Subparagraph of Paragraph (3) by requesting to the companies or institutions (hereinafter referred to as the "calculation institutions of development cost") with the requisite prescribed by the Minister in the specialized company of supervision registered by Article 28 of the Construction Technology Management Act, the office of professional engineers registered by Article 6 of the Professional Engineers Act, the main body of engineering activity notified by Article 4 of the Engineering Technology Promotion Act or the calculation service institutions of the prime cost pursuant to Act on Contracts to Which the State is a Party;

3. The development costs calculated on the basis of the paid amount with obvious clear cause, in which the contract for any construction work with the contractor registered by the Framework Act on the Construction Industry, engineering business contract with the main body of engineering activity notified by Article 4 of the Engineering Technology Promotion Act, etc.;

4. The development costs which are acknowledged to be appropriate for calculation standard pursuant to Paragraph (3) as detailed items prescribed by the Minister. (5) When it is difficult to confirm or calculate the amount because the contents and characteristics of the corresponding project are special when the Minister confirms the actuality of amounts submitted by the obligor of payment under Paragraph (2) and calculates the amounts under Paragraph (3), the confirmation or calculation of the amount may be requested to the calculation institutions of development cost. Article 13 (Recognition as Development Costs of Transfer Income Tax Amount, etc.) The scope of transfer income tax amount counting as development costs pursuant to Article 12 of the Act shall, in the event that the land is transferred before the termination point of imposition, be the tax amount during the period from the commencement point of imposition of the corresponding tax amount to the time of transfer, and in the case where the land is transferred after the termination point of imposition, shall be the tax amount during the period from the commencement point of imposition to the termination point of imposition. In this case, the calculation of tax amount counting as development costs shall be equally divided into daily units.

Article 14 (Calculation of Imposition Amount)

(1) In the event of calculation of development surcharges pursuant to the provision of Articles 8 through 13 of the Act, the surcharges shall, where the termination point of imposition is pertained in the middle of the month, be calculated by applying the normal fluctuation rate of land prices for the previous month on which the termination point of imposition is pertained. In this case, when the normal fluctuation rate of land price of the month which the termination point of imposition is pertained is announced publically, the calculation of the balance amount shall be settled as finalized accounts without delay.

(2) For development projects accompanied with change of land category pursuant to subparagraph 9 of the annexed Table No. 1, the development profit shall be regarded to be generated in the limit of the changed area in fact or in public record changed land category in the authorized areas after termination of the project. (3) For calculation of development surcharges pursuant to Paragraph (2), the development costs shall be the expense paid to the changed part of the land category in the whole expenditure, whereas the expenses paid to the changed part of land category that cannot be clarified, the development costs shall be subject to area rate. Article 15 (Standard of Imposition and Advanced Notice of Development Surcharges) (1) In the case of intending to impose the development surcharges pursuant to Article 14 of the Act, the Minister shall notify the standard of imposition and development surcharges to the obligor of payment in advance.

(2) The notice pursuant to Paragraph (1) shall be made within 25 days from the date when the specification of expense was submitted.

(3) In the case of intending to impose development surcharges on the corresponding project pursuant to the proviso in Article 14, Paragraph (1) of the Act, the Minister may calculate and impose the development surcharge for each corresponding land falling under any of following subparagraphs pursuant to Article 9, Paragraph (3) of the Act.

Article 16 (Preliminary Review Prior to Notification) (1) When objecting against the standard of imposition and the surcharges notified pursuant to Article 15, the obligor of payment may request a preliminary review (hereinafter referred to as the "preliminary review prior to notification") to the Minister within 15 days from the date of receiving the advanced notice. (2) In the event of requesting a preliminary review prior to notification, the notified obligor of payment shall submit to the Minister a written application of preliminary review prior to notification containing the matters falling under any of the following subparagraphs. In this case, if there is any relevant document of evidence, it shall be attached to the written application of preliminary review prior to notification.

1. Name and address or residence of the applicant (in case of legal person, title and name of the representative);

2. Specifications of object land of surcharge imposition;

3. Advanced notice standard of imposition and surcharges; and

4. Reasons for requesting a preliminary review prior to notification (3) The Minister who received a written application of preliminary review prior to notification pursuant to Paragraph (1) shall notify the result of the review thereto within 15 days from the received date of the request. (4) The notice of the result of review prior to notification shall be made by written notice of review determination prior to notification containing the matters falling under each of the following subparagraph.

1. Name and address or residence of the applicant (in case of legal person, title and name of the representative);

2. Specifications of object land of surcharge imposition;

3. Standard of imposition and surcharges; and

4. Results of Review Article 17 (Imposition Period of Surcharges)

The date of imposition and notification of surcharges pursuant to Article 15, Paragraph (3) of the Act shall be prescribed as dates falling under any of the following subparagraphs:

1. In the case of imposing surcharge pursuant to Article 15, Paragraph (3), it shall be applied on the date after three months elapsed from the completion date of the entire project;

2. In the case of additional collection of surcharge pursuant to Article 21, it shall be applied on the date after three months elapsed from the day that the reason for additional collection occurred; and

3. In the case of imposing surcharge other than Paragraphs (1) and (2), it shall be applied on the date after three months elapsed from the termination point of imposition. Article 18 (Determination of Surcharge Amount)

When no objection is raised by the obligor of payment against the advanced notice of surcharges pursuant to Article 15 or notifying the results of review prior to notification pursuant to Article 16, the Minister shall determine the surcharge amount in accordance with the notified amount.

Article 19 (Notification of Payment)

When issuing of a written notice of payment to the obligor of payment pursuant to Article 15 of the Act, the Minister shall specify explicitly the payment amount and its grounds for calculation, as well as the payment period and the payment place. Article 20 (Correction of Surcharge Amount)

(1) In the case of finding any omission or error in the contents of determination after determination of a surcharge amount, the Minister shall immediately inspect the surcharge amount and correct it.

(2) In the event that there is, without special reason, no contribution of public facilities or the land to be contributed to the State or Local Government from the obligor of payment pursuant to Article 12, Paragraph (1), Subparagraph 6 until the payment period pursuant to Article 18 of the Act, the surcharge corresponding to the reckoned amount as development costs pertaining to the public facilities or land, etc. shall be collected from the obligor of payment within one month from the date of overdue payment. In this case, the payment period of the surcharge shall be prescribed as 30 days from the notification date of imposition.

(3) In the case of correcting the surcharge amount pursuant to Paragraph (1) and when an erroneous payments in the surcharge already paid occurs according to administrative trials pursuant to Article 26 of the Act, it shall be paid with additional dues for the period from the date of surcharge payment to the date determined to pay pursuant to Article 30, Paragraph (2) of the Enforcement Decree of Framework Act on National Taxes.

Article 21 (Additional Collection of Surcharges)

(1) The "special reasons" pursuant to Article 16, Paragraph (1) of the Act refers to the case falling under any of the following subparagraphs:

1. Where the corresponding asset is damaged considerably by Force Majeure and other similar causes; and

2. Where the development project is difficult to be continued due to bankruptcy, etc. of the corporation.

(2) The "period as determined by Presidential Decree" provided in Article 16, Paragraph (1) of the Act refers to the period within five years after the termination point of imposition.

(3) The "causes as determined by Presidential Decree" provided in Article 16, Paragraph (1) of the Act refers to the provision falling under any of the following subparagraphs:

1. Where there are different usages of the land other than the initial purpose of the corresponding development projects; and

2. Where the land is transferred to other user who intend to use the land for purposes other than the initial purpose of the corresponding development projects. (4) In the case of intending to collect, pursuant to Article 16, Paragraph (1) of the Act, the reduced surcharges pursuant to Article 7, Paragraph (2) of the Act, the Minister shall send a notice of payment to the obligor for payment within 15 days from the date of occurrence of such a reason as prescribed by Paragraph (3). In this case, the payment period of the surcharges to be collected shall be prescribed within 30 days from the date of notification.

(5) In the case of intending to collect, pursuant to Article 16, Paragraph (1) of the Act, the surcharges which is exempted pursuant to Article 7, Paragraph (3) of the Act, the Minister shall notify the obligor for payment of such collection within 15 days from the date of occurrence of such reasons in Paragraph (3), and the obligor of payment shall submit the specifications in detail, which is necessary for the calculation of development costs pursuant to Article 11 of the Act to the Minister within 15 days from the date of received notice.

(6) In the case where the collection of surcharges pursuant to Paragraph 5, Article 18 of the Act and Article 15, Article 18 and Article 19 of this Enforcement Decree shall be applied mutatis mutandis.

Article 22 (Payment-in-kind)

(1) In the case of intending to apply payment-in-kind pursuant to Article 18, Paragraph (2) of the Act, the applicant shall submit a written application, in which surcharge amounts, address of the land to make payment-in-kind, object land area of payment-in- kind, location, price, etc. are filled out, to the Minister. (2) The Minister shall announce in written notice whether or not to receive the applicant within 30 days from the date of receipt of a written application of payment-in-kind pursuant to Paragraph (1).

(3) The equivalent value of land applicable to be requested for payment-in-kind shall not exceed the imposed surcharge amounts, and the obligor of payment shall pay in cash the balance between imposed surcharges and the equivalent value of the land in payment-in-kind.

(4) The calculation of the equivalent value of the land to appropriate for payment-in-kind shall be a total amount, which publicly notified individual land price (in case of land for payment-in-kind, applying land price in termination pointed imposition) at the time of termination point of imposition is added to the increased portion in normal land prices from termination point of imposition to the date of the written notice pursuant to Paragraph (2).

Article 23 (Collection prior to Due Date)

In the case of intending to collect the surcharges prior to due date pursuant to Article 19, Paragraph (2) of the Act, the Minister shall set the due date as the date after five days elapsed since the date of notification of surcharges and shall record the contents of collection prior to due date and the fact that the due date is changed on the written notice. Article 24 (Postponement of Payment and Payment in Installments) (1) The applicant who intends to make an application for postponement of due date or payment in installments pursuant to Article 20 of the Act shall submit to the Minister the application for postponement of due date or the application for the reason of payment in installments in the written applications containing the postponement of due date or the reason for payment in installments, etc. (2) The Minister shall announce to the applicant whether or not he/she postpones and permits payment in installments in written notice within 30 days from the date of receipt of the application for postponement of due date or the application for the reason of payment in installments pursuant to Paragraph (1). (3) The "case determined by Presidential Decree" in the provisions of Article 20, Paragraph (1), Subparagraph 5 of the Act, refers to the case where the imposed surcharges of the corresponding development project falling under any of the following subparagraphs exceed 20 million won and the obligor of payment shall provide security for tax payment pursuant to Article 31 of the Framework Act on National Taxes:

1. Housing site development project;

2. Industrial complex development project; and

3. Development project accompanied by change of land category (4) The "interest rates of term deposits as determined by Presidential Decree" in the provisions of Article 20, Paragraph (3) of the Act means the amount calculated by the rate of 6/100 per annum.

Article 25 (Disposition on Deficits)

In the case of intending to make dispositions on deficits pursuant to Article 23, Paragraph (1), Subparagraph 4 of the Act, the Minister shall inquire to inspect and confirm the whereabouts of the payer in arrears or whether of his/her assets, to the district tax office, etc and related administration institution: provided that in the case where the surcharges in arrears are less than 100 thousand won, the same shall not apply. Article 25-2 (Specification for Calculation of Development Costs) (1) Any person who intends to submit the specification for calculation of development costs pursuant to Article 24 of the Act shall submit the specification for calculation of development costs, as prescribed by any of the following subparagraphs, to the Minister:

1. Where he/she obtained authorization etc of the completion of construction from the state or local government, the specifications shall be submitted within 40 days from the date of termination point of imposition; and

2. Where the object land of imposition is corresponding to the proviso of Article 9, Paragraph (3) of the Act in case of being difficult to calculate the development costs respectively classified in completed development projects, the specifications shall be submitted within 40 days from the date of completion of the entire development project. In this case, the object lands which have different termination points of imposition shall be separately classified to fill out the specifications. (2) The specifications for calculation of development costs pursuant to Paragraph (1) shall be attached with design documents, etc and documents providing evidence on its calculation.

[Newly Inserted by Enforcement Decree No. 21558, Jun. 25, 2009] Article 26 (Inspection of Development Projects)

In the event that there is no notice pursuant to Article 25, Paragraph (1) of the Act from the concerned administration office, the Minister shall take necessary measures of on-site investigation against the current respective proceeding development projects by the Local Governments or actual fact inquiry, etc. to the concerned administration office in order to protect the development projects of object surcharges of imposition from omission.

Article 27 (Notification of Object Project)

In the case of receiving notice from the concerned administration office pursuant to Article 25, Paragraph (1) of the Act, the Minister shall notify the matters prescribed by ordinance of the Ministry of Land, Transport and Maritime Affairs to the obligor of payment in advance.

Article 28 (Delegation of Authority, Etc.)

(1) The Minister shall delegate the authority falling under any of the following subparagraphs pursuant to Article 27, Paragraph (2) of the Act to the head of City/Gun or Gu (referred to as the head of autonomous Gu; hereinafter the same shall apply).

1. Calculation of land price pursuant to Article 10 of the Act;

2. Determination and imposition of surcharges pursuant to Article 14 of the Act (including matters concerning advanced notice, review prior to notification, modification of surcharges etc. pursuant to Articles 15, 16 and 20 of this Enforcement Decree);

3. Notification of payment pursuant to Article 15 of the Act;

4. Additional collection of surcharges pursuant to Article 16 of the Act;

5. Recognition of payment-in-kind and collection pursuant to Article 18, Paragraph (2) of the Act;

6. Collection prior to due date and notification pursuant to Article 19 of the Act;

7. Postponement of due date or recognition and collection of payment in installments pursuant to Article 20 of the Act;

8. Urge for payment pursuant to Article 21 of the Act;

9. Disposition on default pursuant to Article 22 of the Act;

10. Disposition on deficits pursuant to Article 23 of the Act;

11. Receipt of data submitted pursuant to Article 24 of the Act;

12. Notice and receipt of data pursuant to Article 25 of the Act;

13. Imposition and collection of fine for negligence pursuant to Article 29 of the Act;

14. Receipt of declaration related to the completion of development projects pursuant to Article 9, Paragraph (3), Subparagraph 1 and confirmation of current site and notification pursuant to the same Paragraph, Subparagraph 2;

15. Appointment of public corporation for appraisal and assessment pursuant to Article 12, Paragraph (1), Subparagraph 5, Item B;

16. Calculation of development costs pursuant to Article 12, Paragraph (3), and confirmation or request pursuant to the same Article, Paragraph (5);

17. Measurement of actual inquiry pursuant to Article 26; and

18. Notification of object business pursuant to Article 27 (2) The head of City/Gun or Gu shall deposit, without delay, the devolving portion of the property to special accounts for metropolitan and regional development (hereinafter referred to as the "Special Accounts"), according to the Special Act on Balanced National Development, of collected surcharges pursuant to Paragraph (1) to the Bank of Korea pursuant to Bank of Korea Act (including National Treasury Agency; hereinafter the same shall apply) or to communications agency; while the above head shall deposit, without delay, the remaining devolving portion of property to City/Do to the City/Do savings appointed by Article 77 of the Local Finance Act.

(3) When the head of City/Gun or Gu receives payment-in-kind pursuant to Paragraph (1), he/she shall register the transfer and take other necessary measures, without delay, to return the land corresponding to the devolving portion of property to the Special Accounts and the state-owned property pertaining to Special Accounts. (4) The head of City/Gun or Gu shall prepare actual results related to the imposition and collection of surcharges pursuant to Paragraph (1) every quarter year and shall prepare actual results with payment and payment-in-kinds and shall submit the results to the Minister by the date of 10th of the first month on the next quarter year. (5) The Minister shall pay 7/100 of payment (referred to as the paid amount or the equivalent value of the land as receipt of payment-in-kind by the head of City/Gun or Gu pursuant to Paragraph (2) to the Bank of Korea or communication agency, and the settled accounts are excluded pursuant to Article 3, Paragraph (3)) as commission for delegation on the basis of actual results with imposition and collection of surcharges and actual results with payment and payment-in-kind submitted pursuant to Paragraph (4) to the head of City/Gun or Gu. In this case, the commission for delegation shall be paid every quarter year on the month after the end of a quarter. Article 29 (Standards of Imposition on Fine for Negligence) Standards of imposition on fine for negligence pursuant to Article 29 of the Act shall be as follows:

1. Where the obligor of payment does not submit the specifications of calculation for development costs pursuant to Article 24 of the Act within the due date prescribed by Article 25, Paragraph (2): 1 million won; and

2. Where the obligor of payment does not submit or submits in falsehood the specifications of calculation for development costs pursuant to Article 24 of the Act within three months from the date of termination point of imposition: 2 million won [Newly Inserted by Enforcement Decree No. 21558, Jun. 25, 2009] ADDENDA (Enforcement Decree of Act on Korea Agricultural and Rural Infrastructure Corporation and Farmland Management Fund Act)

Article 1 (Enforcement Date)

This Enforcement Decree shall enter into force from June, 30, 2009: provided, that Article 3 of Addenda shall enter into force from the date of promulgation.

Article 2 Omitted.

Article 3 (Amendment of Other Laws and Regulations) (1) A part of Restitution of Development Gains Act shall be amended as following: Article 6, Paragraph (2), Subparagraph, (d) shall be as follows: D. Korea Agricultural and Rural Infrastructure Corporation established by the Korea Agricultural and Rural Infrastructure Corporation and Farmland Management Fund Act

From Paragraphs (2) through <48> Omitted.

Article 4 Omitted