SOUTH KOREA Law and Practice Contributed by: Hyeon Kang, Tae Kyoon Kim, Seungil Hong and Sung-Ho Moon, Bae, Kim & Lee LLC
4. Planning and Zoning 4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning The principal laws applicable to strategic plan - ning and zoning are NLPUA (regulating zoning and land use) and the Building Act (regulating construction and building use). For certain types of development such as the redevelopment of urban areas, other specific laws may apply, such as the Act on Maintenance and Improvement of Urban Areas and Dwelling Conditions for Resi - dents (AMIUADCR) and the Special Act on Pro - motion of Urban Renovation. In addition, at the national level, MOLIT regulates the development and use of land by setting out a basic land-use plan. At the local level, municipal governments regulate the development and use of land by promulgating local ordinances. 4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction The principal laws applicable to the design, appearance and method of construction are the NLPUA and the Building Act. In particular, the Building Act regulates the standards and usage of the land and the structure and facilities of buildings, as well as the safety, functionality, environment and aesthetics of buildings, and its application is overseen by municipal govern - ments. 4.3 Regulatory Authorities As explained in 4.1 Legislative and Govern- mental Controls Applicable to Strategic Plan- ning and Zoning , at the national level, MOLIT regulates the development and use of land by setting out a basic land use plan. At the local level, municipal governments regulate the devel -
3.9 Effects of a Borrower Becoming Insolvent Under the Civil Code, security interests know - ingly created by a borrower against the propri - etary interest of existing lenders may be made void by the courts upon the request of such existing lenders if: • the borrower is insolvent or becomes insol - vent as a result of the creation of such secu - rity interests; and • the borrower’s assets decrease as a result of the same. Additionally, granting security interests in favour of only some of the existing lenders without receiving any new financing (or new lending arrangements) may constitute fraudulent trans - fer. Under the DRBA, a security interest created by a borrower in rehabilitation or bankruptcy may be voided by the rehabilitation receiver or the bankruptcy administrator if created by “prefer - ential” act by the borrower that favours certain lenders over others. 3.10 Taxes on Loans When entering into a loan agreement in Korea, a fixed stamp duty is levied based on the loan amount. For loans exceeding KRW1 billion, the applicable stamp duty is KRW350,000. This applies regardless of whether the loan is secured, mezzanine or of any other type. If a mortgage is created for a secured loan, a registration tax equivalent to 0.24% of the value of the property is levied when registering the mortgage. There is no separate stamp duty for the mortgage.
938 CHAMBERS.COM
Powered by FlippingBook