Foreign Exchange Transactions Act to Be Revised for Deregulation

The Ministry of Economy and Finance announced on July 5 that the Foreign Exchange Transactions Act would be revised so that foreign exchange transactions can be made much more convenient.

“The mandatory prior notice on the transactions will be repealed except for those having a critical economic impact without prior notice,” the ministry said, adding that those will be explained in detail later.

In addition, the scope of foreign exchange-related work of financial institutions, such as overseas remittance and exchange, is expected to be expanded so that the same regulations, including those for external soundness, are applied to those institutions. At present, financial institutions in different sectors are subject to different limitations. For example, exchange and remittance by securities companies are somewhat limited.

According to the new law, some deregulation is anticipated regarding won payment and reception by foreigners and non-residents, the mandatory report on overseas direct investment will be simplified, and the post-notice will be reduced in the case of transactions without cross-border fund transfer.