On August 29, 2023, an amendment to the Enforcement Decree of the Improper Solicitation and Graft Act (the “Anti-Graft Act”) was approved during a Cabinet meeting.
The approved amendment (the “Amendment”) increases the upper limit on gifts of agricultural, livestock, and fishery products as well as processed agricultural, livestock and fishery products (comprised of at least 50% of agricultural, livestock or fishery products), (collectively, “Agricultural Products”) which may be received or provided to Public Officials in amounts ranging from KRW 100,000 to KRW 150,000. Additionally, during the Lunar New Year and/or Chuseok (Korean Thanksgiving) holidays, the Amendment increases the upper gift limit for Agricultural Products to KRW 300,000. These special limits will apply to gifts given and received during a period starting 24 days before and ending five days after the Lunar New Year Day and Chuseok Day, respectively. As such, during this year’s Chuseok holiday, gifts within the increased limit can be given and received from September 5 to October 4, 2023. The Amendment will also apply to cases where such gifts are mailed within the relevant period and received by a Public Official after October 4.
Prior to the Amendment, as stipulated by the Anti-Graft Act, the upper limit on gifts that may be received or provided to Public Officials for the purpose of facilitation of the Public Official’s duties, social interaction, and ceremonial occasions, was KRW 50,000 in general and KRW 100,000 for Agricultural Products, with a temporary increase in the limit to KRW 200,000 for Agricultural Products during the Lunar New Year and/or Chuseok holidays.
Furthermore, even though all types of securities, including gift certificates were previously excluded, some types are now deemed permissible gift items under the Amendment. These include online mobile gift certificates and vouchers for cultural events or services, in line with the trend of “non-contact gift culture” and the aim to boost cultural and artistic consumption. However, gift certificates with cash-like features, such as department store gift certificates, are still excluded from the list of permissible forms of gifts. Consequently, there might be a need for a case-by-case legal analysis to ascertain the specific scope of inclusion of goods and service vouchers, including online mobile gift certificates and cultural event vouchers.
Although the Amendment raises the upper limit on gifts of Agricultural Products, this does not mean that all acts of giving and receiving gifts or other benefits, which are prohibited under other laws, are now universally permitted.
The existing limits of KRW 30,000 for individual meal expenses and KRW 50,000 for congratulatory or condolence payments will remain unchanged. Concerning congratulatory or condolences payments, cash payments of up to KRW 50,000 and floral arrangements up to KRW 100,000 are permitted. These two forms of offerings may be combined for a total of up to KRW 100,000 (note that even in combined cases, cash contributions cannot exceed KRW 50,000).
The Amendment was approved during a Cabinet meeting on August 29, 2023, and has entered into effect on August 30, 2023.