Archive for March, 2007

Mass Games and Americans in Pyongyang this spring

Friday, March 2nd, 2007

Koryo Tours
March 2, 2007

North Korea has finally confirmed that the Arirang Mass games will be hosted in Pyongyang during the period of April 15th – May 15th this year, we also expect the event to be repeated from August to October but this is not definite yet.

It has also been announced that US citizens will be accepted into DPRK at this time, the only other opportunities Americans have had to travel to North Korea have been in 1995, 2002, and 2005 also for Mass Games events, there are the usual added limitations for US tours (3 night stays as a maximum, must fly both ways from Beijing) but it remains the most fascinating chance of your life to visit a truly enigmatic place to see the kind of event that only the North Koreans can pull off, please see tour dates and itineraries on our website www.koryogroup.com.

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Law on Bankruptcy of Foreign-invested Enterprises

Thursday, March 1st, 2007

From Naenara:

The Law of the Democratic People’s Republic of Korea on Bankruptcy of Foreign-invested Enterprises was adopted by Decree No. 1504 of the Presidium of the Supreme People’s Assembly on April 19, 2000 and is in force.

This law contributes to correct settlement of debts and claims of foreign-invested enterprises and protection of the rights and interests of creditors.

The law consists of 54 articles in 6 chapters.

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Chapter 1. Fundamentals (Articles 1-7)

This chapter stipulates the purpose of institution of the law, foreign investors to which the law is applied, conditions of bankruptcy, reason for exemption from their obligations, and a competent court to handle and settle the cases of enterprise bankruptcy.

The law applies to foreign-invested enterprises (equity or contractual joint-venture enterprises, and wholly foreign-owned enterprises) and foreign-invested banks (equity or contractual joint-venture banks, and wholly foreign-owned banks) that are registered as a corporate body of the DPRK and carry out business activities in the territory of the DPRK.

A foreign-invested enterprise may be declared bankrupt when it fails to repay its debts within the set period for its insolvency, or the debts of the business exceed its assets, or the enterprise cannot be maintained any longer due to a grave loss, or the enterprise cannot be dissolved through normal procedures.

An enterprise may be exempted from bankruptcy when there is assurance that the overdue debts can be settled within 6 months from the time of application for bankruptcy or when it can receive financial assistance for its management from an organ, enterprise or association of the DPRK, or when the parties agree to reconcile with each other after an application is made for bankruptcy.

Chapter 2. Application for and Declaration of Bankruptcy (Articles 8-22)

This chapter defines an applicant for bankruptcy, procedures for an application of bankruptcy, the declaration of bankruptcy of an enterprise made by the court and its legal effect, and the organization (or appointment) of a liquidation committee and its responsibility.

The procedures and method for application of bankruptcy are as follows.

A creditor who is unable to receive the repayment of his claim within the period set in the contract may apply for declaration of bankruptcy of the enterprise to the court having jurisdiction over the seat of the enterprise concerned with a view to collecting his claim. In this case, he should obtain an approval from more than one creditor when the enterprise has over three creditors.

The application will state the title (or name) and address of the creditor, the name and address of the legal representative and his agent, the description, amount and period of the claim, the name and address of the enterprise to be declared bankrupt, and be accompanied by documents explaining the reason for non-repayment of the claim and certifying that the approval has been obtained for an application of the bankruptcy.

An enterprise that has become insolvent may apply to the court for its bankruptcy according to a decision of its board of directors or joint consultative board in order to be exempted from its obligations.

The application for bankruptcy will state the contents concerning the enterprise and its operation, a description of the loss of the enterprise and the reasons for its inability to repay its debts, and be accompanied by such documents as a list of debts and assets.

In case that the debts of an enterprise exceed its assets, the liquidation committee in charge of handling the dissolution of an enterprise may apply for its bankruptcy to the relevant court when it is deemed appropriate for creditors and enterprise to declare the enterprise bankrupt.

The application for bankruptcy will state the name and address of the enterprise, information on its assets and debts and the fact that the enterprise cannot be dissolved through normal procedures.

A court will decide whether to accept or reject an application for bankruptcy within 30 days of receipt of the application. In this case, it may undertake investigation as it deems necessary.

When a court believes that an application for bankruptcy is reasonable after the investigation, it will declare the enterprise bankrupt by making a judgment to that effect and send copies of the written judgment to the applicant and the enterprise concerned.

The written judgment will state the name of the enterprise declared bankrupt, the name of the legal representative, the reason for bankruptcy, the date of judgment and the like.

An enterprise declared bankrupt will suspend its bookkeeping, normal property transactions and management activities from the day of receipt of a copy of the written judgment.

An enterprise notified of the declaration of its bankruptcy will, within 2 days of the receipt of the notice, inform the central organ for guidance of economic cooperation of the fact that it has been declared bankrupt and make necessary registration.

The legal representative (manager of an enterprise) or his agent of the bankrupt enterprise cannot leave the seat of the enterprise and his domicile without permission from the court until the bankruptcy procedures have been completed and will give answers to matters related to the bankruptcy or cooperation in the bankruptcy procedures.

Where a bankrupt enterprise has concealed, distributed, donated or transferred at a low price its assets during the period of 6 months preceding the application for bankruptcy or after the submission of the application or where it has waived its claims without legal ground during the period of 30 days preceding the application for bankruptcy or after the submission of the application or where it has afflicted losses upon its creditors in anticipation of its bankruptcy, such acts will be null and void.

Chapter 3. Declaration, Investigation and Determination of Claims (Articles 23-31)

The chapter stipulates the claim declaration, receipt of declaration, investigation and determination of the claims and the preparation of a list of claims.

A creditor to the bankrupt enterprise will declare his claims in writing to the liquidation committee within the period of claim declaration.

Any claim that has not been declared during the period of claim declaration will be null and void.

The liquidation committee will investigate the claims on the basis of the contents of the declaration within the period of claim investigation.

The creditor may institute a civil lawsuit against the complainant before a court handling the bankruptcy case.

The liquidation committee will be responsible for the final determination of claims for which there is discrepancy between the declarations and finding of the investigation and claims for which a complaint has been raised but no civil lawsuit has been instituted.

Claim declarations and list of claims may be kept by the court. The court may allow parties related to the bankrupt enterprise to read relevant documents upon their request.

Chapter 4. Distribution of Assets of a Bankrupt Enterprise (Articles 32-44)

This chapter defines the securing of assets of the bankrupt enterprise, the order of distribution, an assets distribution schedule, distribution of the assets and termination of the bankruptcy case.

Chapter 5. Reconciliation (Articles 45-52)

The chapter stipulates the reconciliation, procedure and method for submission of reconciliation and the decision of the court approving or rejecting the reconciliation.

Chapter 6. Penalties (Articles 53-54)

It defines the authority of the liquidation committee for sanctions and the legal responsibilities for the violation of this law.

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Chairwoman of Women’s Union Caught With Drugs Unsettles Hoiryeong

Thursday, March 1st, 2007

Daly NK
Kim Young Jin
3/1/2007

Chairwoman for Hoiryeong City’s North Korean Democratic Women’s Union, Suh Kyung Hee’s husband “K” has been dealing with drugs since the moment he managed his company, Maebong Company. However, as central authorities began to centralize businesses since last year, the company closed its doors and “K” adopted his driver “L” as drug runner and his daughter as the treasurer in charge of distributing illicit drugs to smugglers at wholesale costs to districts such as Musan, Hoiryeong and Onsung.

According to a source in Hoiryeong, K and his driver L had been in confrontation with one another since January. In the past K had procured his drugs from Chongjin and moved them to a base in Hoiryeong. Then, the drugs would be either sold to border smugglers or sold to Chinese tradesmen.

Here is where the conflict surfaced. While, L was in charge of delivering the drugs from Chongjin to Hoiryeong, K became suspicious that L was secretly hoarding the drugs elsewhere. Hence, K conducted an investigation trailing L’s steps at which a disagreement arose.

In early Feb, L voluntarily went to North Hamkyung Security Agency in Chongjin and exposed that Chairwoman Suh’s family had been disclosing in drug dealings. The motive behind L indicting Chairwoman Suh’s family is still unknown.

Some argue that the reason L went straight to the district security office and not the city office in Hoiryeong was because of Chairwoman Suh’s hierarchical position in Hoiryeong city. If L had carelessly reported this case to the city office, it is possible that L would have simply lost his self-dignity.

At present, it seems that rumors about this case are spreading rapidly across Hoiryeong creating unsettling feelings in the city.

People of Hoiryeong city are muttering “High officials must also be shown the seriousness of law,” criticizing Chairwoman Suh’s family for concealing such large amounts of dollars and yuan also Chairwoman Suh, who as the leader of the Women’s Union would advocate severe punishment for female defectors.

100g of North Korean drugs sell for 12,000 yuan

North Korean citizen Park Jong Shim (pseudonym, Sanup-dong, Hoiryeong) who lives in the same suburb as Chairwoman Suh, said in a telephone conversation with a reporter on the 26th “The whole city is raucous because of Chairwoman Suh’s story” and informed “Some people say that the power of law will be enforced properly this time as the district security agency has been involved. On the other hand, some question whether or not those people with so much money and power will be punished according to law, despite the district office being involved.”

Hoiryeong citizen Kang Eun Soon (pseudonym) who defected to China in January said “If I think about the times when Chairwoman Suh would go around making a racket, my teeth rattle.” Like second nature, Chairwoman Suh would prowl around advocating, “With the slightest nudge, Hoiryeong women jump to China, not only defiling their bodies but dishonoring the land where mother Kim Jong Sook (Kim Jong Il’s mother) was born.”

Kang said “Usually, Suh would conduct political meetings through her Women’s Union and argue that the reason there was so many public trials for border crossers and illegal acts in Hoiryeong was due to the fact that women could not look after their family. She would say that Hoiryeong women were obsessed over money and would go to any lengths to get this becoming shallow-minded people.”

“Even if a verdict was made stating that Chairwoman Suh was not linked to the drug dealings, she would still not be able to maintain her position because of all the things she has said in the past,” Kang added.

The drug known as “ice” made in North Korea is sold to Korea, Japan and even Macau through the intermediary of China. The drug “ice” as known to defectors, originated from the Heung Nam Pharmaceutical Company.

Though the going rate for “ice” differs according to quality, 100g of high-quality ice is 12,000 yuan, 9,000~10,000 yuan for standard and 7,000 yuan for low-quality ice.

In accordance with North Korea’s legislation Article 218 amended in April 2004, any person found producing or trading drugs is sentenced to a maximum of 5 years time at the Labor Education Camp. If this act has been repeated on numerous occasions or the drug dealings were large scale, a person could be sentenced to 5~10 years at the Labor Education Camp. If the conditions are even more severe, the law clearly states that a person could then be sentenced to more than 10 years time at the Labor Education Camp or sent to the Labor Education Camp for life.

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New divorce law for N.K. defectors

Thursday, March 1st, 2007

Korea Herald
3/1/2007

North Korean defectors will be able to obtain court approval to divorce spouses not residing in the South, as a new law came into effect Tuesday.

The Seoul Family Court said yesterday it will expedite legal proceedings for 223 pending divorce cases filed by North Korean refugees living in South Korea.

Existing family law stipulates that an individual seeking divorce must undergo court arbitration with the couple in attendance. The government revised the Protection and Resettlement for North Korean Defectors Act on Jan. 26 to plug the loophole.

A special provision has been added to the law, allowing the court to proceed with divorce cases only if the petitioner proves that his or her spouse is not residing in South Korea.

The South is seeing an increasing number of North Korean defectors fleeing poverty and human rights abuses. More than 10,000 North Koreans have been granted South Korean citizenship as of Feb. 16, the Unification Ministry said.

Since 2003, 232 North Koreans have filed for divorces but only nine cases were heard. One application was accepted and eight were dismissed.

The court suspended decisions for the remaining 223 cases because of the lack of a specific law, the court said.

It is still unclear whether South Korea should recognize marriages registered in North Korea, which the Constitution defines as part of its territory.

According to the revised bill, the plaintiff must submit to the court a letter by the unification minister confirming that his or her spouse is not residing in the South.

The court will post a public notice of the application on its online bulletin board, and can proceed with the case two months later.

Under current law, spouses must be notified of the petition for divorce before any legal proceedings can take place. For defectors, the two-month public notice period will be the equivalent of notification.

In 2004, a court ruled in favor of a 30-year-old female North Korean defector seeking a divorce and parental rights.

Officials at Korea Legal Aid Corp. said that a total of 115 defectors were given support to file petitions in 2005-2006, of which 36 were petitions for divorce.

Among the defectors, a 37-year-old woman identified by her surname Jeon filed for a divorce after running away from home due to domestic violence. Her husband beat her and had extra-marital affairs because she could not have children, she said.

It was difficult for Jeon to start a new life here with another man because of her marital status, the KLAC said.

“The cases can be heard in court only if the plaintiffs are able to obtain authorization from the Unification Ministry that their spouses are not defectors as well,” a judge at the Seoul Family Court said.

“Submitting the documents do not mean they can all get divorced. That is decided by the judges who will make the final decision after hearing the facts of the case.”

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Koreas lock horns over humanitarian projects, economic issues

Thursday, March 1st, 2007

Yonhap
3/1/2007

South Korea’s five-member negotiating team to the ongoing ministerial talks on Thursday paid a courtesy call on Kim Yong-nam, the North’s ceremonial head of state, as the talks went into a third day in Pyongyang.

Lee Jae-joung, South Korea’s point man on North Korea, became the third unification minister to meet Kim, president of the Presidium of the Supreme People’s Assembly, and Lee is to hold a press briefing to explain what they discussed later Thursday, pool reports said. The meeting was hurriedly arranged at the request of the South on Thursday morning.

At the Mansudae Assembly Hall, the North’s No. 2 leader received the South Korean delegation, which consists of Lee, Vice Finance Minister Chin Dong-soo, Vice Culture Minister Park Yang-woo, Lee Kwan-se, the assistant unification minister, and Yoo Hyung-ho, a senior official of the National Intelligence Service.

The meeting came as officials from the divided Koreas were engaged in negotiations on how to resume aid and family reunion events and other topics at their first high-level talks in seven months.

They had lunch together at the renovated Okryukwan, a North Korean restaurant famous for its cold noodle soup. After their one-hour meeting with the North’s titular head of state, the South Korean delegation will visit the North’s national orchestra, the reports said.

Earlier in the day, the South Koreans held a simple 10-minute ceremony to mark the 88th anniversary of the March 1 Independence Movement at the Koryo Hotel. As a gesture of goodwill, the North provided a birthday breakfast for Lee, who turned 63 on Thursday.

The two sides had no official schedule for negotiations for the day, but top negotiators and working-level officials held talks to discuss the topics proposed during a plenary session on Wednesday.

The South gave top priority to resuming face-to-face family reunion events in April and construction of a family reunion center at the Mount Geumgang resort as soon as possible, while the North called for holding economic talks this month and pressed for the South’s resumption of rice and fertilizer aid, the reports said.

“The North raised the issue of humanitarian aid during working-level officials’ meeting on Wednesday. But no direct mention on rice and fertilizer aid was made in a draft joint statement,” a South Korean official said, asking to remain anonymous.

North Korea has proposed to resume inter-Korean humanitarian projects on a full scale immediately, and also offered to hold a meeting to discuss ways of boosting economic ties sometime in March in Pyongyang.

The details for reopening reunion events for families separated by the border are likely to be worked out easily, but Seoul’s rice aid to North Korea might surface as a bone of contention, according to analysts. South Korea also holds the position it prefers to hold the the economic talks in April.

The South hopes to reopen the economic talks next month so as to use rice aid as leverage to make the North take quick steps in complying with a recent agreement over its nuclear disarmament in return for energy aid.

“Unlike previous ministerial talks, these involve the dual tracks of inter-Korean relations and the six-party talks, so difficult negotiations are ahead,” a top South Korean unification ministry official said, asking to remain anonymous because of the sensitivity of the issue.

Kwon Ho-ung, the North’s top negotiator, avoided specifics about humanitarian projects in his keynote speech, but analysts said that the North hopes to link the resumption of emotional family reunions with Seoul’s food and fertilizer assistance to Pyongyang.

Shortly after the North conducted its missile tests in July, the South suspended food and fertilizer aid. After the North’s nuclear weapon test in October, the possible resumption of aid was blocked.

In retaliation, the communist nation immediately suspended inter-Korean talks and reunions for families separated by the sealed border since the end of the 1950-53 Korean War.

Seoul may offer to ship some of the fertilizer aid to Pyongyang shortly after the talks so that it can be used for rice seedling planting this spring. But the South maintains the position that more fertilizer and rice will be given in accordance with how much progress the North makes in implementing the steps agreed upon during the six-nation talks on its nuclear dismantlement, according to sources.

Not only a date for the resumption of economic talks with Pyongyang as the venue, they will also have to agree on how to cooperate in inter-Korean projects, such as reopening cross-border railways, they said.

The South’s chief negotiator has proposed test runs of reconnected cross-border railways in the first half of this year, and the launch of operations by the end of 2007, according to pool reports.

As a precondition for the operation of cross-border railways, Lee said it is necessary to make headway in the inter-Korea economic project, which involves exchanging raw materials from the South for the North’s minerals.

North Korea abruptly called off scheduled test runs of cross-border railways in May under apparent pressure from the hard-line military. It also led to mothballing an economic accord under which South Korea was supposed to provide raw materials in exchange for the North’s minerals. North Korea’s subsequent missile and nuclear weapons tests further clouded hopes of implementing the accord.

The tracks, one line cutting across the western section of the border and the other crossing through the eastern side, have been completed and were set to undergo test runs. A set of parallel roads have been in use since 2005 for South Koreans traveling to the North.

South Korea has repeatedly called on North Korea to provide a security guarantee for the operation of cross-border railways, but the North has yet to give an answer on the issue.

The reconnection of the severed train lines was one of the tangible inter-Korean rapprochement projects agreed upon following the historic summit between then South Korean President Kim Dae-jung and North Korean leader Kim Jong-il in 2000.

In 2005, South Korea agreed to provide the North with US$80 million worth of raw materials to help it produce clothing, footwear and soap starting in 2006. In return, the North was to provide the South with minerals, such as zinc and magnesite, after mines were developed with South Korean investments, guaranteed by the Pyongyang government.

The talks, the 20th since the leaders of the two Koreas held their first-ever summit in Pyongyang in June 2000, come as the world is paying keen attention to whether North Korea will honor its promise to take the first steps toward ending its nuclear weapons program in return for energy aid.

The ministerial talks, the highest-level channel of regular dialogue between the two Koreas, had been suspended amid tension over North Korea’s missile tests in July and its nuclear weapon test in October.

On Feb. 13, North Korea agreed to shut down its nuclear facilities and eventually dismantle them in exchange for energy aid and other benefits, while the U.S. agreed to discuss normalizing relations with the communist nation. Only two days later, Seoul and Pyongyang agreed to resume ministerial dialogue after a seven-month hiatus.

In the deal, North Korea will receive initial aid equal to 50,000 tons of heavy fuel oil for shutting down and sealing its main nuclear reactor and related facilities at Yongbyon, 80 kilometers north of Pyongyang, within 60 days. International Atomic Energy Agency inspectors will determine whether the North carries out the steps properly.

North Korea can eventually receive another 950,000 tons in aid if it disables the reactor irreversibly and declares that it has ended all nuclear programs. The cost of the aid will be equitably distributed among South Korea, the U.S., China, Japan and Russia, according to officials.

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