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KOREA FOUNDATION FOR THE PROMOTION OF PRIVATE SCHOOL ACT

Ministry of Education, Science and Technology (Private University Support Division) 02- 2100-6525

Article 1 (Purpose)

The purpose of this Act is to contribute to the promotion of private school education by providing support for the improvement of educational environment of private school institutions through the establishment of the Korea Foundation for the Promotion of Private School. Article 1-2 (Definitions)

The term "private school institutions" in this Act means schools, juridical persons or lifelong educational facilities falling under any of the following subparagraphs:

1. Private schools under Article 2 of the Private School Act, and school foundations establishing and operating them; and

2. Lifelong educational institutions of remote college type authorized by the Minister of Education, Science and Technology under Article 22 (3) of the Lifelong Education Act, and juridical persons establishing and operating them. [This Article Newly Inserted Mar. 24, 2006]

Article 2 (Juridical Person)

The Korea Foundation for the Promotion of Private School (hereinafter referred to as the "Foundation") shall be a juridical person. Article 3 (Establishment)

The Foundation shall come into existence by registration of establishment at the location of its main office.

Article 4 (Articles of Association)

(1) Articles of association of the Foundation shall include matters falling under each of the following subparagraphs:

1. Purpose;

2. Name;

3. Location of main office;

4. Matters on operations;

5. Matters on board of directors;

6. Matters on executives and employees;

7. Matters on organization;

8. Matters on funds;

9. Matters on assets and accounting;

10. Matters on amending articles of association; and

11. Matters on public notice; (2) The Foundation shall, when intending to amend its articles of association, obtain authorization from the Minister of Education, Science and Technology.

Article 5 (Prohibition of Use of Similar Name)

Any person other than the Foundation under this Act shall not use the name "Korea Foundation for the Promotion of Private School" or similar one.

Article 6 (Operations)

(1) The Foundation shall perform the following operations to support private school institutions:

1. Raising, operation and management of funds;

2. Training, research and investigation to improve management of private school institutions;

3. Property management entrusted by private school institutions;

4. Operations entrusted by the Minister of Education, Science and Technology;

5. Operations that may be performed by the Foundation under the provisions of other Acts; and

6. Other operations required for promotion of private school institutions and improvement of their management.

(2) Necessary matters concerning the operations under paragraph (1) shall be determined by Presidential Decree.

Article 7 (Executives)

(1) The Foundation shall have directors of not less than seven and not more than nine, including a president, and not more than two auditors.

(2) The directors (excluding president) and auditors under paragraph (1) shall be appointed by the Minister of Education, Science and Technology upon recommendation of the board of directors, and the president shall be appointed by the said Minister subject to recommendation by the Recommendation Committee for Heads of Institutions under Article 6 (2) of the Framework Act on Management of Government- Affiliated Institutions, and undergoing deliberation and resolution by the board of directors. (3) Not less than two executives from school foundations shall be included in the directors under paragraph (1).

Article 8 (Term of Office for Executives)

(1) The term of office for the executives of the Foundation shall be three years and they may be reappointed.

(2) All the executives except president shall serve on a part-time basis. [Wholly Amended Jan. 21, 1999]

Article 9 (Duties of Executives)

(1) The president shall represent the Foundation, and exercise overall control and supervision of the Foundation affairs.

(2) Deleted.

(3) The auditors shall audit the accounts and operations of the Foundation. Article 10 (Reasons for Disqualification)

A person falling under any of the following subparagraphs shall not be an executive of the Foundation:

1. Any person who does not have the nationality of the Republic of Korea; or 2. Any person falling under any subparagraph of Article 33 of the State Public Officials Act. Article 11 (Board of Directors)

(1) The Foundation shall have a board of directors to deliberate and resolve important matters concerning operations of the Foundation.

(2) The board of directors shall consist of president and directors. (3) The president shall convene meetings of the board of directors, and shall preside over the meetings.

(4) The board of directors shall resolve with the consent of a majority of its enrolled directors, unless specially provided otherwise in the articles of association. (5) The auditors may attend the board of directors and state their opinions. Article 12 (Restriction on Remuneration for Part-Time Executives) Remuneration shall not be paid to directors and auditors serving on a part-time basis: Provided, that their out-of-pocket expenses may be reimbursed. Article 13 (Appointment and Dismissal of Staff)

The staff members of the Foundation shall be appointed or dismissed by the president as prescribed by the articles of association.

Article 14 (Legal Fiction as Public Officials in Application of Penal Provisions ) Executives and employees of the Foundation shall be deemed as public officials in application of the penal provisions of the Criminal Act and other Acts. Article 15 (Restrictions on Holding Any Other Office by Executives and Employees) The president and staff member of the Foundation shall not hold the position of director or staff of private school institutions nor shall they engage in profit-making business during their tenure of office. Article 16 (Free Loan of State Property)

The Government may loan State property to the Foundation for free when deemed necessary for establishment and operation of the Foundation. Article 17 (Establishment of Private School Promotion Fund) A Private School Promotion Fund (hereinafter referred to as the "Fund") shall be established in the Foundation in order to appropriate the funds for the operations of the Foundation.

Article 18 (Raising of Fund)

(1) The Fund shall be raised with the financial resources falling under any of the following subparagraphs:

1. Contributions from the Government;

2. Transfers from other Funds;

3. Loans under Article 26;

4. Donations from corporations, organizations and individuals;

5. Funds raised by issuing bonds under Article 27; and

6. Funds and proceeds obtained from operation of the Fund. (2) The Government shall appropriate a certain amount of money in the budget every year as contribution to the Fund under subparagraph 1 of paragraph (1), beginning from the year of the enforcement of this Act.

Article 19 (Use of Fund)

The Fund shall be used for the operations falling under each of the following subparagraphs:

1. Financing of costs required for repair, renovation and extension of educational facilities for private school institutions;

2. Financing of costs required for improvement of educational environment and programs for private school institutions, other than the costs under subparagraph 1;

3. Projects required for structural improvement of private school institutions;

4. Projects for extension of educational facilities of private school institutions, which are implemented by mutatis mutandis application of the method under Article 4 of the Act on Private Participation in Infrastructure;

5. Disbursement of the expenses required for raising, operation and management of the Fund; and

6. Other projects required for improvement of educational environment and management of private school institutions.

Article 20 (Operation and Management of Fund)

(1) The Fund shall be operated and managed by the Foundation. (2) Necessary matters concerning operation and management of the Fund shall be prescribed by Presidential Decree.

Article 21 (Financing of Funds)

(1) Financing of costs under each subparagraph of Article 19 may be granted without security.

(2) Necessary matters concerning objects, conditions, method and repayment, etc. of the financing shall be prescribed by Presidential Decree. Article 22 (Fiscal Year)

Fiscal year of the Foundation shall follow the fiscal year of the Government. Article 23 (Submission of Business Plan, etc.)

The Foundation shall prepare and submit the business plan and the budget of revenues and expenditures to the Minister of Education, Science and Technology prior to commencement of each fiscal year. The same shall apply when the Foundation intends to alter the plan and budget. Article 24 (Report on the Settlement of Accounts, etc.) The Foundation shall prepare the accounts settlement report and business report, and submit them, along with auditor's written opinion thereof, to the Minister of Education, Science and Technology within two months from commencement of each fiscal year. Article 25 (Disposal of Surplus ) In the case where there is a surplus in the balance account, such surplus shall be used initially to fill up the loss, and the remainder shall be deposited into the Fund. Article 26 (Borrowing)

(1) The Foundation may borrow money on a long-term or short-term basis in order to raise the Fund. (2) The short-term borrowing under paragraph (1) shall be reimbursed within current fiscal year: Provided, that in the case where reimbursement is impossible due to shortage of fund, the Foundation may borrow money within the limit of the amount of short-term borrowing . (3) The Foundation shall, upon borrowing money under paragraphs (1) and (2), report matters thereof to the Minister of Education, Science and Technology.

Article 27 (Issue of Private School Promotion Bond) (1) The Foundation may issue private school promotion bond (hereinafter referred to as the "bond") in order to raise the Fund.

(2) Deleted.

(3) The Government may guarantee the repayment of principal and interest for the bonds issued by the Foundation.

(4) The Foundation shall, upon issuing the bond under paragraph (1), report on the pertinent matters determined by the Minister of Education, Science and Technology to the said Minister. Article 28 (Compensation for Difference of Interests) Difference between the interest payable in connection with borrowing and the interest receivable from loan shall be compensated from the national treasury. Article 29 (Bearing of Costs)

The State may subsidize, wholly or partly, the costs required for operation of the Foundation.

[Wholly Amended Jan. 21, 1999]

Article 30 (Supervision)

The Minister of Education, Science and Technology shall supervise operations of the Foundation, and may conduct inspection or issue order when deemed necessary for supervision. Article 31 (Mutatis Mutandis Application)

For matters not stipulated in this Act, the provisions of the Civil Act concerning incorporated foundation shall apply mutatis mutandis to the Foundation. Article 32 (Fine for Negligence)

(1) Any person who has violated the provisions of Article 5 shall be punished by a fine for negligence not more than one million won.

(2) The fine for negligence under paragraph (1) shall be imposed and collected by the Minister of Education, Science and Technology as prescribed by Presidential Decree. (3) Any person who has dissatisfaction with the disposition of fine for negligence under paragraph (2) may file a formal objection to the Minister of Education, Science and Technology within 30 days from the date when he/she has come to know such disposition. (4) Where any person who has been subjected to the disposition of fine for negligence under paragraph (2) files an objection under paragraph (3), the Minister of Education, Science and Technology shall notify the competent court thereof without delay, and the competent court so notified shall judge the case of fine for negligence under the Non- Contentious Case Litigation Procedure Act.

(5) Where a formal objection has not been filed within the period under paragraph (3) and the fine for negligence has not been paid, the fine shall be collected in accordance with the examples of disposition of national taxes in arrears. ADDENDA (Government Organization Act) Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation: Provided, that ...... ..... Among the laws amended in accordance with Article 6 of Addenda, the amended parts of the law which was announced before enforcement of this Act but has not enforced yet shall become effective from the enforcement date of the concerned law. Articles 2 through 5 Omitted.

Article 6 (Amendment of Other Law)

through <114> Omitted

<115> The Korea Foundation for the Promotion of Private School Act shall be partially amended as follows:

The term "Minister of Education and Human Resources" in subparagraph 2 of Article 1-2, subparagraph 4 of Article 6 (1) and Article 27 (4) shall each be amended to "Minister of Education, Science and Technology."

The term "Minister of Education and Human Resources" in Article 4 (2), the foregoing part of Article 24, Article 26 (3), Article 30, and Article 32 (2) through (4) shall each be amended to "Minister of Education, Science and Technology." The term "Minister of Education and Human Resources" in Article 7 (2) shall be amended to "Minister of Education, Science and Technology." <116> through <760> Omitted.

Article 7 Omitted.