Public Officials' 'Kim Nam-guk Prevention Act' Enforced... Virtual Asset 'Transaction Records' Must Also Be Reported

Ministry of Personnel Management Announces Legislative Notice for Partial Amendment of the Enforcement Decree of the Public Officials Ethics Act... Full Enforcement from December 14

From now on, public officials of grade 4 or higher must specifically report the types and quantities of virtual assets they hold when registering their assets. In particular, public officials subject to asset disclosure of grade 1 or higher must describe the process of virtual asset wealth formation and submit transaction details for one year along with supporting documents. This so-called 'Kim Nam-guk Prevention Act,' which emerged in the aftermath of the virtual asset investment controversy involving Assemblyman Kim Nam-guk, will be fully enforced starting December 14.

The Ministry of Personnel Management announced on the 4th that it will publicly notify a partial amendment to the Enforcement Decree of the Public Officials Ethics Act, focusing on these contents. This is a follow-up measure to the amendment of the Public Officials Ethics Act in June to mandate the registration of virtual asset holdings by public officials.

On the 10th, amid news that FTX, the world's second-largest virtual asset exchange, was experiencing a liquidity crisis, a bank run occurred, and following Binance's withdrawal from the acquisition, virtual assets collectively declined, with Bitcoin plummeting 12%. The price board at the Bithumb Customer Support Center in Seocho-gu, Seoul, displayed the prices of major cryptocurrencies including Bitcoin. Photo by Kang Jin-hyung aymsdream@

First, those obligated to register assets must register the types and quantities of virtual assets they hold without fail. The value is reported based on the average daily price on the registration reference date for virtual assets traded at the business sites of virtual asset service providers (Upbit, Bithumb, Coinone, Korbit) announced by the Commissioner of the National Tax Service. For other virtual assets, the final market price is reported; however, if the final market price is unknown or practically unverifiable, the value should be registered based on reasonably recognized prices such as actual transaction prices.

The process of virtual asset wealth formation must also be mandatorily described. Currently, those subject to asset disclosure must describe the process of wealth formation, including acquisition date, acquisition route, and income source, for specific assets such as unlisted stocks and real estate. Going forward, the process of wealth formation must also be written for virtual assets.

The method of reporting virtual asset transaction details will also be specified. Even if the asset disclosure subject does not hold virtual assets as of the asset registration reference date, they must report all virtual asset transaction details for the past year and submit transaction statements issued by virtual asset service providers.

Additionally, virtual assets have been added to the consent form for information provision, allowing relevant agencies to receive information related to the virtual assets of the individual and their family. Public officials responsible for acquiring information or exercising influence over virtual assets by agency can be restricted from holding virtual assets. The legal amendment thus establishes grounds for receiving balance information and other data on virtual assets. Currently, to assist accurate reporting during asset registration, if the registrant submits a consent form, the Government Public Officials Ethics Committee receives financial and real estate information from relevant agencies and provides it to the individual.

Lee In-ho, Deputy Minister of the Ministry of Personnel Management, said, "Following the amendment of the Public Officials Ethics Act to require virtual asset registration, the current Enforcement Decree of the Public Officials Ethics Act stipulates specific implementation measures, laying the institutional foundation for virtual asset registration. We will encourage public officials to faithfully register their virtual assets and strictly review them to prevent illicit wealth accumulation."

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