Development Profits from Gangnam Also Used in Gangbuk...Amended National Land Planning Act to Be Promulgated on the 12th

Seoul City "Finalizing Legislation for 'Public Contribution Regionalization'"

Apartment complex viewed from Lotte World Tower Seoul Sky in Songpa-gu, Seoul [Image source=Yonhap News]

[Asia Economy Reporter Onyu Lim] From now on, the profits from Gangnam development can be used throughout Seoul, including Gangbuk.

On the 7th, Seoul City announced that the legislation for the 'Public Contribution Regionalization,' which it has continuously proposed to the government, has been finalized. The 'Framework Act on National Land Planning and Utilization' (National Land Planning Act), which includes the improvement plan prepared by Seoul City and the Ministry of Land, Infrastructure and Transport, is scheduled to be promulgated on the 12th.

Through this, public contribution funds generated from large-scale development in the Gangnam area can be used anywhere throughout Seoul, including Gangbuk. Public contribution funds refer to cash donations received as part of development profits in exchange for allowing changes in urban planning, such as floor area ratio increases, in development projects. Under the previous law, public contribution funds could only be used within the jurisdiction of the respective autonomous district.

Seoul City has continuously proposed legal amendments for the 'Public Contribution Regionalization,' and after more than ten intensive discussions with the Ministry of Land, Infrastructure and Transport since March last year, an improvement plan was prepared. This improvement plan was passed by the National Assembly plenary session on December 9th last year through discussions following the amendment proposal of the National Land Planning Act by National Assembly member Junho Cheon.

Seoul City has consistently emphasized the need for legal amendments, stating that the concentration of public contribution funds from development in Gangnam has widened regional disparities and led to a vicious cycle of rising real estate prices in the Gangnam area. It announced that it will invest part of the public contribution funds collected from Gangnam development into relatively underdeveloped areas to promote balanced development throughout Seoul.

The uses of public contribution funds are defined as ① installation of long-unexecuted urban planning facilities ② facilities specified by ordinances such as rental housing (in Seoul’s case, public rental housing, public dormitories, public rental industrial facilities) ③ installation of infrastructure and public facilities. Specific uses will be decided through 'district unit plans,' and a 'Public Facility Installation Fund' will be established and operated.

Lee Jeong-hwa, Director of the Urban Planning Bureau, said, “In line with the enforcement of the amended National Land Planning Act (in July), we will revise related regulations such as urban planning ordinances and prepare detailed operational standards for the rational use of public contributions. Through the full-scale implementation of ‘Public Contribution Regionalization’ in the second half of the year, we will resolve regional imbalances.”

This content was produced with the assistance of AI translation services.