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Regulations on Mt. Kumgang Tourist Zone adopted

KCNA

    Pyongyang, June 30 (KCNA) -- Regulations on the establishment, registration and operation of enterprises in Mt. Kumgang Tourist Zone were adopted according to the law on Mt. Kumgang Tourist Zone. The regulations that have 34 articles are aimed to establish a proper order and provide every convenience for investment and other business activities. They were adopted as decision 107 of the presidium of the Supreme People's Assembly of the DPRK on May 12.
    The regulations specify issues such as investors, objects to be invested in, forms of setting up enterprises, period and forms of investment, the scope of business activities, distribution of profits, notification of the disorganization of enterprises.
    According to the regulations, South Koreans and overseas Koreans shall make investments in the tourist zone and foreign corporate bodies, individuals and economic bodies may also invest in it.
    An investor shall invest in such tourist sectors as travel service, accommodating service, amusement and service facilities and the construction of infrastructural facilities related to them as well as pollution-free ultra-modern scientific and technological field such as software industry.
    Investments in tourist sectors and the construction of infrastructure related to them shall be encouraged but those which may pollute or change the natural and ecological environment of Mt. Kumgang shall be restricted or banned.
    An investor may set up enterprises of various forms and operate them on his own or in collaboration with other investors and the registered capital shall be over 10 percent of the total fund invested.
    An enterprise shall conduct activities within the scope of the permitted type of business and shall have facilities enough for the environmental protection and sanitation.
    An enterprise may issue stock or bonds according to its rules and bring in necessary materials to the zone or take manufactured goods and purchased materials out of the zone without restriction.
    Goods shall be taken into and out of the zone according to prior notice.
    An enterprise may make contracts with any institution, enterprise and organization in the DPRK through the Central Tourist Zone Guiding Organ, introduce materials necessary for business activities and sell manufactured goods and may process raw and other materials and parts on commission.
    The settlement of accounts at an enterprise shall be made bi-annually or yearly.
    An enterprise shall create a reserve fund only after paying its fixed income tax from its profits. It may annually raise reserve fund equivalent to 5 percent of its profits till it reaches 10 percent of the registered capital.
    And it may use it only for increasing the registered capital and making up for financial loss.
    An enterprise may allocate its profits to financiers and this allocation shall be made with net income, ie. money that has been left after its income tax is paid and a reserve fund is created from its profits.
    An enterprise to be disorganized shall submit a notice of its dissolution to the tourist zone management institution after discussing and deciding it at its board meeting or at the general meeting of financiers.
    An enterprise that has operated for more than 15 years shall be exempted from paying its income tax for excess profits.
    No one shall be allowed to dispose of the properties of the enterprise, which has sent a notice about its disorganization, at one's own will. Properties left after accounts are settled with an enterprise may be disposed of inside the tourist zone or be taken to areas outside the DPRK.
    In case branch offices, business offices or individuals intend to make profits in the zone they shall be registered at the tourist zone management institution. In this case the institution shall issue a relevant registration card.