RESTRICTED
WORLD TRADE S/FIN/W/12/Add.15
4September 1997
ORGANIZATION(97-3618)
Original: English Committee onTrade inFinancial Services
COMMUNICATION FROM THE REPUBLIC OFKOREA
Initial Offer onFinancial Services
Addendum
Thefollowing communication iscirculated attherequest oftheRepublic ofKorea toMembers
oftheCommittee onTrade inFinancial Services.
_______________
TheRepublic ofKorea hereby presents itsinitial offer ofspecific commitments onfinancial
services based onfullMFN treatment.
Intheinterests ofconcluding these financial negotiations successfully, Korea hasincluded 34
improvements inthisinitial offerreflecting therecent reforms andliberalization measures thathave
beenimplemented since 1995.
Major improvements areasfollows:
AllSectors
- Expansion offoreign portfolio investment ceilings inlisted stocks.
- Expansion offoreign acquisition inoutstanding bonds .
AllFinancial Sectors
- Update ofpresent standstill commitment.
Banking Sectors
- Establishment ofsubsidiaries ofcredit cardcompanies.
- Establishment ofsubsidiaries, joint-ventures andbranches offinancial leasing companies.
- Expansion ofFXspotoversold positions.
- Elimination oftheissuance limits andminimum denomination oftheCD.
- Liberalization ofinterest ratesondeposits.
- Allowance ofdebenture issues bybanks.
- Exemption oftheunderlying documentation requirement inthecaseofforward transactions.
- Elimination ofthemandatory purchase ofMonetary Stabilization Bonds.
Securities Sectors
- Establishment ofjointventures offoreign securities investment trustcompanies.
- Establishment ofbranches offoreign securities investment trustcompanies.S/FIN/W/12/Add.15
Page2
- Establishment ofbranches offoreign investment advisory companies.
- Elimination oftheforeign equity participation limitperforeign company (previously lessthan
10%) inexisting securities companies.
- Elimination oftheforeign equity participation limitperforeign company (previously lessthan
5%)inexisting securities investment trustcompanies.
- Expansion oftheaggregate foreign equity participation limittolessthan50% (previously
lessthan10%) inexisting securities investment trustcompanies.
- Elimination oftheforeign equity participation limitperforeign company (previously lessthan
5%)inexisting investment advisory companies.
- Expansion oftheaggregate foreign equity participation limittolessthan50% (previously
lessthan10%) inexisting investment advisory companies.
- Expansion oftypes ofsecurities which maybebrokered byforeigners.
- Elimination ofapproval requirement ontheestablishment ofrepresentative offices offoreign
securities companies.
- Elimination ofapproval requirement ontheestablishment ofrepresentative offices offoreign
securities investment trustcompanies.
- Elimination ofapproval requirement ontheestablishment ofrepresentative offices offoreign
investment advisory companies.
Credit Rating andCredit Information Business
- Establishment ofalltypes ofcommercial presence ofcredit rating companies.
- Allowance offoreign participation uptolessthan50% inexisting financial information
companies.
Insurance Sectors
- Elimination ofEconomic Needs Tests forlife,non-life, reinsurance companies andinsurance
agencies.
- Establishment ofsubsidiaries ofnon-life insurance companies.
- Establishment ofjointventures ofnon-life insurance companies.
- Elimination ofthepriority cessions requirement onreinsurance firms established inKorea.
- Elimination ofrestrictions onquoting non-life insurance ratesfrom abroad.
- Elimination ofrestrictions onforeign equity inlifeinsurance jointventure companies.
- Allowance formultiple foreign shareholders inlifeinsurance jointventures.
- Elimination oftheduopoly onfidelity andsurety.
- Establishment ofindependent insurance agencies.
Thisinitial offerisconditional anddepends uponacommensurate improvement inother WTO
members ’commitments.
Pursuant totheadopted Decisions, theRepublic ofKorea retains therighttomodify orwithdraw
allorpartofitsspecific commitments onfinancial services, tolistMFN exemptions, andmake technical
modifications.
* Inaddition,toexpresshissincerewishesforthesuccessfulconclusionofthisnegotiation,theHonourable
Kyong Shik Kang, Deputy Prime Minister andMinister ofFinance andEconomy hasmade some
statements, alsoattached herewith.S/FIN/W/12/Add.15
Page3
STATEMENT
Deputy Prime Minister andMinister ofFinance &Economy Kyong ShikKang onthe
Submission ofanInitial Offer totheWTO Financial Services Negotiations
1September 1997
TheRepublic ofKorea hasliberalized itsfinancial sector significantly since July1995
andstands ready tocontribute further tothesuccessful conclusion oftheWTO Financial
Services Negotiations. Wearesubmitting aninitial offer which contributes substantially to
theobjectivesofGATSandwillworkpositivelytowardbuildingaconsensusduringnegotiation.
Given therecent trend toward globalization andchange inthefinancial sector, Ibelieve
themember countries oftheWTO mustwork together todevelop robust, mutually beneficial
multilateral rules onafullMFN basis. With thatinmind, itisimportant thatthefinancial
services negotiations besuccessfully concluded ontime.
Thisoffer represents ourbesteffort toreflect allthecommitments scheduled tobe
implemented upuntilnow. Itisasignificant enhancement overouroffer inJuly1995 and
contains 34substantial improvements based onthefullMFN principle andthestandstill
principle. Restrictions onestablishing commercial presence havelargely beenabolished; for
example, subsidiaries andjointventures ofnon-life insurance companies, subsidiaries ofcredit
cardcompanies, jointventures andbranches offoreign securities investment trustcompanies,
andbranches offoreign investment advisory companies maybeestablished. TheEconomic
Needs Tests forinsurance companies have been abolished. Restrictions onforeign equity
participation havealsobeensignificantly relaxed. Some items havebeen liberalized ahead
oftheoriginal OECD schedule aswell. Furthermore, thisoffer alsoaddresses some issues,
likeinterest rateliberalization, which were notcovered byourOECD commitments.
However, itshould beunderstood thatouroffer isconditional anddepends upon the
overall balance ofthenegotiations andcorresponding efforts byother members toimprove
theircommitments.
Wehopethatthese financial services negotiations areconcluded successfully during
theagreed timeframe andencourage theactive participation ofother member countries.S/FIN/W/12/Add.15
Page4REPUBLIC OFKOREA -DRAFT SCHEDULE OFSPECIFIC COMMITMENTS*
Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
ALL SECTORS INCLUDED IN
THIS SCHEDULE
(ALL SECTORS)
Therevisions intheALL
SECTORS section ofthis
schedule onlypertain tomode 3
oftheALL SECTORS
commitments contained inthe
document
GATS/SC/48/Suppl.1/Rev. 1.(3) Theacquisition ofoutstanding stocks of
existing domestic companies bynatural
persons orjuridical persons ofanother
member isrestricted. However, foreign
portfolio investment inKorean stocks is
permitted onlyforthestocks listed on
theKorean Stock Exchanges, and
individual foreign investors canownup
to36percentofeach company 'stotal
stock, while aggregate foreign
investments cannot exceed 1523percent
(1018percentinthecaseoftwopublic
enterprises: Pohang IronandSteel
Company, Korea Electric Power
Corporation) pereach company.
-Theaggregate andindividual
ceilings willberaised in1996-97.(3)Theamount offoreign direct investment
must beatleast 50million Won.
Theacquisition oflandisunbound except:
(i) That theacquisition oflandby
companies which arenotdeemed as
foreign under theAlien Land Law
ispermitted, and
(ii) That theacquisition oflandby
companies which aredeemed as
foreign under theAlien Land Law
andbranches offoreign company is
permitted, subject toapproval or
notification inaccordance withthe
Alien Land Law, forthefollowing
legitimate business purposes:(3)Residents whohave
been treated as
foreigners inthe
Securities Exchange
Actareaccorded
national treatment in
portfolio investment
inKorean stocks.
*Anasterisk ontheCPC (UNProvisional Central Product Classification: statistical Papers series MNo.77,Department ofInternational Economic andSocial
Affairs, Statistical Office oftheUnited Nations, New York, 1991) code number indicates thatthecorresponding service subsector inthisschedule onlycovers apartor
parts oftheservice subsector classified under thegiven CPC code number.S/FIN/W/12/Add.15
Page5Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Theacquisition ofoutstanding bonds of
existing domestic companies bynatural
persons orjuridical persons ofanother
Member isrestricted except inthe
following cases:
(i) Direct foreign investment isallowed
innon-guaranteed Convertible Bonds
issued bylisted small-and medium
sized companies.
(ii) Thepurchase ofgovernment and
public bonds, withinterest rates
comparable tointernational interest
rates, isallowed intheprimary
market.- landused forsupplying services
during thecourse ofnormal business
activities;
- landused forhousing senior
company personnel under pertinent
laws; and
- landused forfulfilling land-holding
requirements stipulated bypertinent
laws.
Eligibility forsubsidies, including tax
benefits, maybelimited tocompanies
which areestablished inKorea according
tothepertinent laws.
Unbound forresearch anddevelopment
subsidies.S/FIN/W/12/Add.15
Page6Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(iii) Foreign investors areallowed to
make indirect bond investment
through thepurchase ofbeneficiary
certificates offered exclusively to
foreigners.
(iv) Foreign investors willbeareallowed
tomake indirect bond investment
through theestablishment ofa
country funds.
(v) Foreign direct investment inmedium
andlong-term non-guaranteed bonds
issued bysmall andmedium-sized
companies willbeareallowed in
1997.
Theestablishment ofbranches must be
approved inaccordance withtheForeign
Exchange Management Act.
Infinancial services, theestablishment of
representative offices must alsobe
approved inaccordance withtheForeign
Exchange Management Act.S/FIN/W/12/Add.15
Page7Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
7.FINANCIAL SERVICES1
Asdescribed inparagraph 2(a)oftheAnnex onFinancial Services, Korea shall notbeprevented from taking prudential measures including requirements
related toparent companies, theminimum capital requirement, orminimum operating funds requirement.
Inthose cases where theestablishment ofcommercial presences byforeign companies inthefinancial sector isallowed, approval bytherelevant
authorities isrequired inaccordance withrelated laws andregulations unless otherwise specified inanyofsubsectors below.
Allfinancial services covered by
thisschedule including Insurance(1),(2),(3) Korea undertakes astandstill
commitment forlimitations onmarket
access, where specific commitments are
undertaken, infinancial services listed in
thisschedule asof30June 1995 31August
1997.(1),(2),(3) Korea undertakes a
standstill commitment forlimitations on
national treatment, where specific
commitments areundertaken, infinancial
services listed inthisschedule asof30
June 1995 31August 1997.
1Subsectors infinancial services areclassified based ontheunitofbusiness establishment. Afinancial institution must beestablished foronlyonebusiness
defined insubsectors (1)through (1214),andthuscannot engage inbusiness activities inother subsectors.S/FIN/W/12/Add.15
Page8Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Cross-border supply offinancial services
andsupply through consumer movement
maynotbesettled inKorean currency.
After theestablishment ofacommercial
presence, financial institutions mayhandle
onlytransactions, denominated andsettled
inKorean currency, withresidents.
Approval isrequired fortransactions
denominated orsettled inforeign currency
ortransactions withnon-residents.
Themanagement andoperation ofassets of
afinancial institution arerestricted. A
financial institution maynotown
non-business realestate.S/FIN/W/12/Add.15
Page9Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Assets owned bybranches must bekept
within theterritory ofKorea. Thecapital
ofthehead office isnotrecognized asthe
basis fordetermining theextent offunding
andlending activities ofbranches.
Interest rates ofgovernment- financed
loans, loans rediscounted bytheBank of
Korea, andshort term deposits oflessthan
oneyear(incaseofinstalment savings
deposits, lessthantwoyears) are
regulated.
- Alldeposit rates except forthose on
demand deposits anditsequivalents
willbeliberalized in1996-1997.
Demand deposit interest rates are
regulated .
Some newfinancial products, including
derivatives, aresubject toapproval.
- With interest rateandforeign
exchange liberalization, such
products willbemore widely
allowed, subject torelevant laws and
regulations.S/FIN/W/12/Add.15
Page10Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
BANKING AND OTHER
FINANCIAL SERVICES
(1)BANKING BUSINESSES
Following banking services:(1)Unbound
(2)Unbound
(3)(Horizontal limitations onbanking
services)(1)Unbound
(2)Unbound
(3)None
(i)Deposit andrelated services2
[81115*, 81116*]Only branches offoreign banks which rank
among theworld ’stop500banks interms
ofassets sizeorrepresentative offices are
permitted.
(ii)Loan andrelated services3
[8131*, 81132*]
(iii)Payment andmoney
transmission services
including credit card
services [81339*]-Foreign financial institutions willbe
allowed equity participation inexisting
domestic banks in1996-1997.
Aperson4mayownupto4percentofthe
stocks ofabank and15percentofthe
stocks ofaprovincial bank without the
special authorization oftherelevant
authorities.
2Activities inwhich banks obtain funds from thepublic byreceiving deposits orissuing transferable instruments orother securities.
3Activities, such asloans andbilldiscounts, inwhich banks provide funds tothepublic inorder toreceive interest.
4Thedefinition of“aperson ”isinaccordance withtherelevant provision ofthePresidential Decree oftheBank Act.S/FIN/W/12/Add.15
Page11Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(iv)Settlement andclearing
services5[81339*]
(v)Foreign exchange services6
[81333*]
(vi)Services auxiliary to
banking:
- Saleofcommercial
bills7[81339*]
- Saleoftrade bills8
[81339*]
- Mutual instalment
deposit [81132*]Issuance ofdebentures isprohibited .
Foreign exchange position isregulated.
-Theoversold position ofspotforeign
exchange is3percent oftheprevious
month ’saverage balance offoreign
exchange billsbought, US$35million, or
23percentofcapital (whichever is
greatest).
<Limitations onDeposit andRelated
Services>
- Payment guarantees
andcommitments
[81339*]
(vii) Trust services9
[81192*, 81193]Issuance limit ofCDs islimited tothe
larger of400percentofcapital or35
billion Won. Thematurity ofCDsis
restricted toshall bemore than60-270 30
days ,anditsminimum denomination is
restricted to30million Won.
5Settlement andclearing services onnotes, billsandcheques bybanks according totheArticles ofKFTCI (Korea Financial Telecommunications andClearings
Institute).
6Purchase, sale, issuance, remittance andcollection offoreign exchange.
7Acommercial billisdefined asabillaccompanying commercial transactions.
8Atrade billisdefined asabillissued byexporters based onL/Cbefore shipping export cargo.
9Activities where thetrustee, having been delegated theauthority, manages assets ofthetruster forthebeneficiary.S/FIN/W/12/Add.15
Page12Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
-Theminimum denomination willbe
lowered andthematurity expanded in
1996-1997.
Deposits forspecific purposes, such as
housing subscription deposits, maybe
handled onlybydesignated institutions.
<Limitations onloanandrelated
services>
Foreign currency loans arerestricted with
respect toceiling anduses.
Mandatory lending tosmall-and
medium-sized companies arerequired.
<Limitations onforeign exchange
services>
Underlying transaction anddocumentation
requirements apply toforeign exchange
transactions.
Underlying documentation requirements
areexempt ex-post notification inthecase
offorward transactions.
Inthefollowing cases, underlying
documentation requirements areexempt:
(i) Forward transactions between two
foreign currencies.
(ii) Forward transactions involving the
Won andaforeign currency, valued
atunder US$10 million.S/FIN/W/12/Add.15
Page13Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(iii) Financial futures transactions in
exchanges.
(iv) Financial futures transactions inthe
OTC market, valued atunder US$20
million.
<Limitations ontrust services>
Real estate trust business isprohibited.
Approvals bothfrom theMonetary Board
forengaging inbusinesses other thanthe
main banking businesses andfrom the
Ministry ofFinance andEconomy for
handling atrust business arerequired,
provided thatthehead office islicensed in
thehome country tohandle atrust
business.
Except forSpecific Money
Trusts, mandatrory purchase of
Monetary Stabilization Bond is
required inmanaging assets ofatrust
business.
- Thepurchase ratio willbe
lowered in1996-1997.
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.S/FIN/W/12/Add.15
Page14Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(2)CREDIT CARD
BUSINESSES
Credit cardservices [81133](1)Unbound
(2)Unbound
(3)Only representative offices orbranches of
Commercial presences arepermitted to
foreign suppliers which dealexclusively
withcredit cardservices. arepermitted.
Lending forcredit cardmembers through
such means ascardloans issubject to
limitations.(1)Unbound
(2)Unbound
(3)None
Maximum limits areapplied tovarious
rates such asfeesandinterest rates.
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
(3)FINANCIAL LEASING
BUSINESSES
Financial leasing services
[81120](1)Unbound
(2)Unbound
(3)Unbound None
(4)Unbound, except asindicated inALL
SECTORS.(1)Unbound
(2)Unbound
(3)None
(4)Unbound, except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.S/FIN/W/12/Add.15
Page15Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(4) SECURITIES
BUSINESSES
Following services related to
securities
(i) Dealing [81199*]
(ii) Broking [81321*]
(iii) Underwriting [81322*]
(iv) Securities savings
[81119*](1)Unbound
(2)Unbound
(3)Only representative offices, branches, or
joint ventures offoreign securities
companies whose paid-in capital or
shareholder 'sequity isvalued atover 50
billion Won or100billion Won,
respectively andwhich have been inthe
securities business forover 5years are
permitted. Representative offices maybe
established bypre-notification.(1)Unbound
(2)Unbound
(3)Among thethree main businesses, namely
(i),(ii),and(iii)anoperating fund ofat
least 5,10,or15billion Won isrequired
toengage inanyone,two, orallthree of
theabove businesses, respectively. None
(v) Credit granting
[81139*]Injoint ventures, which must be
established asaChusik Hoesa (ajoint
stock corporation), foreign equity
participation must beatleast 40percent
butlessthan50percent.
Ifthere aremultiple foreign shareholders
inthejoint venture companies, atleast one
shareholder must holdmore than20per
centoftheequity. Shareholders must
meet certain eligibility criteria. Paid-in
capital ofjoint ventures must beatleast 50
billion Won. International financial
organizations mayholdlessthan5percent
oftheequity.S/FIN/W/12/Add.15
Page16Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Equity participation inanexisting domestic
securities company byforeign securities
companies islimited tolessthan10per
centpercompany andlessthan50percent
intheaggregate.
Broking forforeigners islimited tolisted
stocks securities allowed forforeign
investment asspecified inALLSECTORS
inthisschedule.
Ceilings andoperating conditions are
applied totheservices listed under (iv)
and(v).
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.S/FIN/W/12/Add.15
Page17Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(5)SECURITIES
INVESTMENT TRUST
BUSINESSES
Securities investment trust
services [81193*](1)Unbound
(2)Unbound
(3)Only representative offices, branches, and
joint ventures whose foreign share isless
than50percent offoreign securities
investment trust companies arepermitted.
Representative offices maybeestablished
bypre-notification.
Branches should bepreceded bya
representative office byatleast oneyear.(1)Unbound
(2)Unbound
(3)None
Equity participation inanexisting domestic
securities investment trust company by
foreign securities investment trust
companies islimited tolessthan5percent
perforeign company andlessthan1050
percentintheaggregate.
Equity participation byforeign securities
investment trust companies innewor
existing joint ventures withanyoftheten
largest domestic conglomerates islimited
to30percentperforeign company.S/FIN/W/12/Add.15
Page18Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
- Themaximum limit ofequity
participation willbeexpanded in
1994-1995.
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.
(6)INVESTMENT ADVISORY
BUSINESSES
Investment advisory services
[81332](1)Unbound
(2)Unbound
(3)Only representative offices andbranches
offoreign investment advisory companies
arepermitted.
Representative offices maybeestablished
bypre-notification.(1)Unbound
(2)Unbound
(3)NoneS/FIN/W/12/Add.15
Page19Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Equity participation inanexisting domestic
investment advisory services company by
foreign investment advisory companies is
limited tolessthan5percentperforeign
company andlessthan1050percentin
theaggregate.
- Themaximum limit ofequity
participation willbeexpanded in
1994-1995.
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.S/FIN/W/12/Add.15
Page20Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(7)CREDIT RATING
BUSINESSES
Credit rating services
[81339*]
(8)CREDIT INFORMATION
BUSINESSES
Credit Information Services
[81339*](1)Unbound
(2)Unbound
(3)Credit rating companies should be
designated bytherelevant authorities to
assess thecredit rating ofcompanies which
maywish toissue non-guaranteed
corporate bonds andcommercial papers.
(4)Unbound except asindicated inALL
SECTORS
(1)Unbound
(2)Unbound
(3)Unbound except forequity participation of
lessthan50percent inexisting financial
information companies.
(4)Unbound except asindicated inALL
SECTORS(1)Unbound
(2)Unbound
(3)None
(4)Unbound except asindicated inALL
SECTORS
(1)Unbound
(2)Unbound
(3)None
(4)Unbound except asindicated inALL
SECTORSS/FIN/W/12/Add.15
Page21Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
INSURANCE AND
INSURANCE-RELATED
SERVICES
(9)LIFE INSURANCE
BUSINESSES
Lifeinsurance services
[81211](1)Unbound
(2)Unbound
(3)Injoint ventures, multiple foreign
shareholders arenotallowed, andthe
foreign share must exceed 49percent.
Shareholders must meet certain eligibility
criteria.
Representative offices, branches,
subsidiaries andjoint ventures offoreign
lifeinsurance companies arepermitted.
Theestablishment ofjoint ventures with
Korean lifeinsurance companies arenot
allowed.(1)Unbound
(2)Unbound
(3)None
Establishment ofacommercial presence is
subject totheeconomic needs test.
Therecruitment andemployment of
insurance professionals, including sales
personnel, arerestricted.
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.S/FIN/W/12/Add.15
Page22Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(10) NON-LIFE
INSURANCE
BUSINESSES
Non-life insurance services
[8129]1)Unbound except formarine export/import
cargo andaviation insurance
(2)Unbound
(3)Quoting insurance rates from abroad is
subject torestrictions. These restrictions
donotapply toaviation insurance.(1)Unbound
(2)Unbound
(3)None
Only Representative offices, andbranches,
subsidiaries andjoint ventures offoreign
non-life insurance companies are
permitted. Theestablishment ofjoint
ventures withKorean non-life insurance
companies arenotallowed .
Foreign equity participation islimited to
onlyexisting domestic non-life insurance
companies.
Establishment ofacommercial presence is
subject totheeconomic needs test.
Duopoly byspecialized firms ismaintained
infidelity andsurety insurance.
Therecruitment andemployment of
insurance professionals, including sales
personnel, arerestricted.
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.S/FIN/W/12/Add.15
Page23Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(11) REINSURANCE AND
RETROCESSION
BUSINESSES
Reinsurance andretrocession
services [81299*](1)None (1)Ceding insurers arerequired toreinsure
withpriority given toreinsurance
companies established inKorea. Theabove
requirement does notapply toaviation
insurance. None
(2)None
(3)Direct insurance companies may
participate inthesupply ofservices subject
totherestriction insection (810)
regarding non-life insurance services.(2)None
(3)None
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.S/FIN/W/12/Add.15
Page24Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(12) INSURANCE
BROKING AND
AGENCY
BUSINESSES
Insurance broking and
agency services [81401*](1)Unbound
(2)Unbound(1)Unbound
(2)Unbound
(3)Only exclusive agencies areallowed. In
thecaseoflifeandnon-life insurance
services, dualagency ispermitted.
Establishment ofacommercial presence is
subject totheeconomic needs test.(3)None
(4)Unbound except asindicated inALL
SECTORS.(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.S/FIN/W/12/Add.15
Page25Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(13) CLAIM
SETTLEMENT
BUSINESSES
Claim settlement
services [81403*](1)Unbound
(2)Unbound
(3)Unbound
(4)Unbound except asindicated inALL
SECTORS.(1)None
(2)None
(3)None
(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea
(14) ACTUARIAL
BUSINESSES
Actuarial services
[81404](1)Unbound
(2)Unbound
(3)Unbound
(4)Unbound except asindicated inALL
SECTORS.(1)None
(2)None
(3)None
(4)Unbound except asindicated inALL
SECTORS.
Topexecutive personnel ofeach
establishment must reside inKorea.