Kim Nam-Guk Prevention Act

The 'Kim Nam-Guk' Prevention Act

On the 22nd of May 2023, the National Assembly and the Political Reform Special Committee passed a bill in the plenary session to amend the National Assembly Act, adding virtual assets as a subject for disclosure of lawmakers' assets.[3]

Virtual Assets

The amendment includes virtual assets in the registration of personal interests of lawmakers. It requires the disclosure of virtual assets owned by the lawmakers themselves, their spouses, and direct lineal relatives, as well as the issuer's list, and the criteria for disclosing virtual assets (either by ratio or amount) will be determined by the National Assembly rules.[4]

The scope of the law also includes the incumbent 21st National Assembly members. If the amendment is passed in the plenary session on the 25th, lawmakers must register their acquired or held virtual assets and any changes by the end of this month and submit them to the Ethics Committee for review by June 30th 2023. The Ethics Committee will examine potential conflicts of interest and submit its opinions to the Speaker of the National Assembly, the respective lawmaker, and the representative of their affiliated negotiation group by July 31st 2023.

In the Subcommittee on Legislation Evaluation of the Administrative Safety Committee, a bill to amend the Public Officials Ethics Act, which includes virtual assets as part of the property declaration and disclosure subject for high-ranking officials, including lawmakers, was passed. The purpose is to address the current law's shortcomings, as virtual assets are currently excluded from the scope of property reporting, unlike cash, stocks, bonds, and gold..

The amendment imposes an obligation on high-ranking officials to declare all virtual assets they own. It also includes spouses and direct lineal relatives as subjects for declaration. The method of calculating the value of virtual assets will be delegated to the enforcement decree. The amendment also establishes provisions to obtain information on the holdings and transaction history from virtual asset service providers. The possibility of including virtual assets in blind trusts was also discussed but excluded due to the current law's limitations on trust operators' handling of virtual assets.
The Administrative Safety Committee plans to hold a plenary session on the 24th to ensure the passage of the amendment in the plenary session on the 25th. The enforcement of the law will be six months after its promulgation. If all goes well, it could be implemented by the end of the year, which means it will apply to incumbent lawmakers as well.

The Plenary Session

The National Assembly's Environment and Labor Committee held a full session and passed the motion to bring the main session of the "Yellow Envelope Law" (amendment to the Labor Union and Labor Relations Adjustment Act, Articles 2 and 3). The key points of the law are to strengthen the responsibility of the primary employers for subcontracted workers and limit indiscriminate compensation claims against companies by striking workers. On this day, ruling party lawmakers protested against the handling of the amendment just before the vote and walked out, resulting in the amendment being passed solely by the opposition parties, including the Democratic Party and the Justice Party.
According to the National Assembly Act, if the Legislation and Judiciary Committee fails to complete the review of a specific bill within 60 days, the chairperson of the standing committee in charge can propose it to the plenary session after consultation with the secretary-general.

The Passing of the Law

Among the 272 participants in the vote, there were 243 in favor, 5 against, and 24 abstentions.
The plenary session and Kim Nam-Guk's law was unanimously passed.[2]

Why was the Kim Nam-guk Prevention Law passed?

The law was passed in response to a scandal involving some National Assembly members moving large amounts of , triggering concerns over potential money laundering, conflicts of interest, and using insider information. [5]

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Kim Nam-Guk Prevention Act

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May 25, 2023


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