Posted August. 11, 2005 03:05,
Starting October 13, if you purchase land in an area designated for transaction permission, you will not be allowed to sell it for as long as five years depending on its use. Also, when applying for a land transaction permit, you must attach a detailed financing plan.
Since the total area of land requiring land transaction permission amounts to 20,926km² (approx. 6.33 billion pyeong), covering over 20 percent of the entire area of South Korea (99,601km² or approx. 30.129 billion pyeong), this latest measure is expected to place substantial restraint on land transactions nationwide.
On August 10, the Ministry of Construction and Transportation announced the impending legislation of an amended Enforcement Decree on the Act on the Planning and Utilization of the National Territory that contains the above changes. The new decree will go into effect on October 13 after undergoing inspection by the Ministry of Government Legislation.
According to the revised bill, the ban on the resale of land in transaction permit-required areas will be extended from six months to two years from the date of purchase for agricultural land, from one to three years for forests and fields, from six months to four years for development land, and from six months to five years for other miscellaneous types of land. Violation of these guidelines will result in two years or less in prison or a fine equal to 30 percent of the declared value of the land in question.
However, property owners who purchased their land prior to October 13 will not be held liable under the new enforcement decree. In addition, resale is allowed regardless of the ban if the owner becomes unable to use the land for the purposes designated in the permit due to emigration, military service, or a natural disaster. Similarly, resale is allowed before the expiration of the ban if the owner of an area permitted for residential development builds housing on the land in question and puts units up for sale.
The financing documentation required when applying for a land purchase permit will be transmitted to the National Tax Service for investigation into possible evasion of taxes, trust of ownership, and other issues.