North Korea Foreign Investment Act 1992: English Translation & Korean Original

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DPRK Law

DPRK Foreign Investment Law: Full Text (1992–2011 Amendments)

North Korea Foreign Investment Law

The Democratic People’s Republic of Korea (DPRK) has established a legal framework to govern and facilitate the entry of foreign capital into its economy, with the Law on Foreign Investment serving as the foundational instrument in this domain. First adopted in 1992 and subsequently amended several times through 2011, this law reflects the state’s intent to encourage foreign investment while maintaining a structured and controlled environment for economic engagement. The law is designed to serve a dual purpose: actively promoting investment by foreign entities while simultaneously guaranteeing the protection of their legitimate rights and interests. It establishes the basic parameters for foreign economic activity, defining key concepts such as foreign investment, foreign investors, and the various types of permissible enterprises, including contractual joint ventures, equity joint ventures, wholly foreign-owned enterprises, and foreign-invested banks.

A central feature of the legislation is its emphasis on providing incentives and protections to attract capital in priority sectors, such as advanced technology, infrastructure development, and scientific research. Investors in these areas may benefit from tax reductions, favorable land use conditions, and preferential access to bank loans. Furthermore, the law stipulates that investments in designated Special Economic Zones enjoy enhanced preferential conditions regarding materials procurement, product sales, and employment. To reassure potential investors, the law explicitly prohibits the nationalization or expropriation of foreign property, guaranteeing that legitimate profits and other earnings can be remitted abroad without restriction. It also outlines mechanisms for dispute resolution through consultation, mediation, arbitration, or judicial proceedings. While establishing these investor safeguards, the law concurrently delineates specific areas where investment is restricted or prohibited to protect national security, public health, and environmental standards. Overall, this legal framework represents the DPRK’s effort to integrate foreign capital into its centrally guided economic system under defined conditions of state oversight and protection.

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Foreign Investment Law: Full Text

Part 1

Law of the Democratic People’s Republic of Korea on Foreign Investment

Adopted by Decision No. 17 of the Standing Committee of the Supreme People’s Assembly on October 5, 1992
Amended by Decree No. 484 of the Praesidium of the Supreme People’s Assembly on February 26, 1999
Amended by Decree No. 780 of the Praesidium of the Supreme People’s Assembly on November 30, 2004
Amended by Decree No. 2367 of the Praesidium of the Supreme People’s Assembly on September 26, 2007
Amended by Decree No. 2688 of the Praesidium of the Supreme People’s Assembly on April 29, 2008
Amended by Decree No. 2842 of the Praesidium of the Supreme People’s Assembly on August 19, 2008
Amended by Decree No. 1991 of the Praesidium of the Supreme People’s Assembly on November 29, 2011

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Article 1 (Objective and Status of this Law)
조선민주주의 인민공화국 외국인투자법은 우리 나라에 대한 외국투자가들의 투자를 장려하며 그들의 합법적 권리와 리익을 보호하는데 이바지한다. 이 법은 외국투자관계의 기본법이다.

This Law is enacted for the purpose of encouraging foreign investment in the DPRK and protecting the legitimate rights and interests of the investors. This Law is the basic law on foreign investment.

Article 2 (Definitions)

1. 외국인투자란 외국투자가가 경제활동을 목적으로 우리 나라에 재산이나 재산권, 기술비결을 들여오는 것이다.
2. 외국투자가란 우리 나라에 투자하는 다른 나라의 법인, 개인이다.
3. 외국투자기업이란 외국인투자기업과 외국기업이다.
4. 외국인투자기업이란 우리 나라에 창설한 합작기업, 합영기업, 외국인 기업이다.
5. 합작기업이란 우리측 투자가와 외국측 투자가가 공동으로 투자하고 우리측이 운영하며 계약에 따라 상대측의 출자몫을 상환하거나 리윤을 분배하는 기업이다.
6. 합영기업이란 우리측 투자가와 외국측 투자가가 공동으로 투자하고 공동으로 운영하며 투자몫에 따라 리윤을 분배하는 기업이다.
7. 외국인기업이란 외국투자가가 단독으로 투자하고 운영하는 기업이다.
8. 외국기업이란 투자관리기관에 등록하고 경제활동을 하는 다른 나라 기업이다.
9. 외국투자은행이란 우리 나라에 설립한 합영은행, 외국인은행, 외국은행지점이다.
10. 특수경제지대란 국가가 특별히 정한 법규에 따라 투자, 생산, 무역, 봉사 같은 경제활동에 특혜가 보장되는 지역이다.
11. Foreign investment means an investment in the DPRK by a foreign investor of property, property rights or know-how for the purpose of carrying out economic activities;
12. Foreign investor means a corporate body or an individual of a foreign country that makes an investment in the territory of the DPRK;
13. Foreign-invested businesses mean foreign-invested enterprises and foreign enterprises;
14. Foreign-invested enterprises mean equity joint venture enterprises, contractual joint venture enterprises and wholly foreign-owned enterprises that are set up in the territory of the DPRK;
15. A contractual joint venture is an enterprise in which investors from the DPRK and a foreign country jointly invest, the management is undertaken by the partner from the host country and the share of the investment made by the foreign investor is redeemed or the profits are distributed according to the terms of the contract;
16. An equity joint venture is an enterprise in which investors from the DPRK and a foreign country jointly invest and operate the business, and the profits are distributed to the investors proportionate to the shares of their investment;
17. A wholly foreign-owned enterprise is an enterprise in which a foreign investor makes an investment and undertakes management on his own account;
18. A foreign enterprise is an enterprise of a foreign country that is registered with the investment management organ for conducting business activities;
19. A foreign-invested bank is a joint venture bank, wholly foreign-owned bank and branch of a foreign bank that are set up in the territory of the DPRK; and
20. Special economic zone means an area where preferential treatment is accorded to business activities such as investment, production, trade and service pursuant to the laws and regulations enacted by the State for those purposes.

Article 3 (Establishment of Foreign-invested Enterprises and Banks)
외국투자가 우리 나라에서 외국인투자기업과 외국투자은행을 창설운영할수 있다. 이 경우 투자관리기관의 승인을 받는다. 투자관리기관에는 해당 중앙기관과 특수경제지대관리기관이 속한다.

A foreign investor may establish and operate an enterprise or a bank in the territory of the DPRK. In this case approval thereof shall be obtained from the investment management organ. The investment management organ shall include the competent central organ and the management organ of the special economic zones.

Article 4 (Protection of Rights and Interests of Investors, Provision of Conditions)
국가는 외국투자가의 합법적인 권리와 리익을 보호하며 외국인투자기업과 외국투자은행의 경영활동조건을 보장하도록 한다.

The State shall protect the legal rights and interests of foreign investors and provide conditions for the operation of foreign-invested enterprises and foreign-invested banks.

Article 5 (Investors)
다른 나라의 법인과 개인은 우리 나라에 투자할수 있다. 해외동포도 이 법에 따라 투자할 수 있다.

Foreign corporate bodies and individuals are free to make investment in the DPRK. Overseas Koreans may also make an investment in accordance with this Law.

Article 6 (Sectors and Modes of Investment)
외국투자가는 공업, 농업, 건설, 운수, 통신, 과학기술, 관광, 류통, 금융 같은 여러 부문에 여러가지 방식으로 투자할수 있다.

Foreign investors may make investments of various modes in such sectors as industry, agriculture, construction, transportation, communications, science and technology, tourism, circulation and finance.

Article 7 (Priority Sectors)
국가는 첨단기술을 비롯한 현대적 기술과 국제시장에서 경쟁력이 높은 제품을 생산하는 부문, 하부구조건설부문, 과학연구 및 기술개발부문에 대한 투자를 특별히 장려한다.

The State particularly encourages investments that are conducive to the introduction of high technologies and other state-of-the-art technology, manufacturing of internationally competitive goods, construction of infrastructure facilities, scientific research and development of technology.

Article 8 (Preferential Treatment for Priority Sectors)
장려하는 부문에 투자하여 창설한 외국인투자기업은 소득세를 비롯한 여러가지 세금의 감면, 유리한 토지리용조건의 보장, 은행대부의 우선적제공 같은 우대를 받는다.

A foreign-invested enterprise that invests in the priority sector shall enjoy such benefits as reduction and exemption of income tax and other taxes, favourable conditions of land use and preferential bank loans.

Article 9 (Provision of Preferential Conditions for Business in Special Economic Zones)
국가는 특수경제지대안에 창설된 외국투자기업에 물자구입 및 반출입, 제품판매, 로력채용, 세금납부, 토지리용 같은 여러 분야에서 특혜적인 경영활동조건을 보장하도록 한다.

The State shall ensure that foreign-invested businesses that are set up in the special economic zones are provided with preferential conditions for business activities in such areas as purchase, bringing-in and taking-out of materials, marketing of products, employment of labour, payment of taxes and land use.

Article 10 (Provision of Conditions for Immigration of Foreign Investors)
국가는 우리 나라에 투자하는 외국투자가들의 입출국수속절차와 방법을 편리하게 정하도록 한다.

The State shall ensure that formalities for entry and departure of foreigners making an investment in the DPRK are set in such a way as to suit their convenience.

Article 11 (Prohibition and Restriction of Investment)
투자를 금지하거나 제한하는 대상은 다음과 같다.

1. 나라의 안전과 주민들의 건강, 건전한 사회도덕생활에 저해를 주는 대상
2. 자원수출을 목적으로 하는 대상
3. 환경보호기준에 맞지 않는 대상
4. 기술적으로 뒤떨어진 대상
5. 경제적 효과성이 적은 대상

Investment shall be prohibited or restricted in the following cases:

1. Projects that are detrimental to national security, public health and healthy social and moral life;
2. Projects for the purpose of exporting natural resources;
3. Projects that violate the environmental protection criteria;
4. Projects that are technically outdated; and
5. Projects with low economic efficiency.

Article 12 (Investment Property, Property Rights)
외국투자가는 화폐재산, 현물재산, 공업소유권 같은 재산과 재산권으로 투자할 수 있다. 이 경우 투자하는 재산과 재산권의 가치는 해당 시기의 국제시장가격에 기초하여 당사자들 사이의 합의에 따라 평가한다.

A foreign investor may invest in the form of currency, property in kind, industrial property right and property right. In this case the value of the assets and property rights invested shall be determined by agreement between the partners by reference to the prevailing world market price.

Article 13 (Establishment of Branch, Representative Office or Agency)
외국인투자기업과 합영은행, 외국인은행은 우리 나라 또는 다른 나라에 지사, 사무소, 대리점 같은것을 내오거나 새끼회사를 내올수 있으며 다른 나라 회사들과 련합할 수 있다.

Foreign-invested enterprises, foreign-invested banks and wholly foreign-owned banks may open branches, representative offices, agencies or subsidiaries in the DPRK or other countries. They may conduct joint operations with foreign companies.

Article 14 (Legal Capacity)
외국인투자기업과 합영은행, 외국인은행은 우리 나라의 법인으로 된다. 그러나 우리 나라에 있는 외국기업의 지사, 사무소, 대리점, 외국은행지점은 우리 나라의 법인으로 되지 않는다.

Foreign-invested enterprises, foreign-invested banks and wholly foreign-owned banks shall be corporate bodies of the DPRK. Branches, representative offices and agencies of foreign enterprises, and branches of foreign banks established in the DPRK shall not be corporate bodies of the DPRK.

Article 15 (Term of Land Lease)
국가는 외국투자가와 외국인투자기업, 외국투자은행을 창설하는데 필요한 토지를 임대하여준다. 토지임대기간은 최고 50년까지로 한다. 임대받은 토지는 토지임대기관의 승인밑에 임대기간안에 양도하거나 저당잡힐 수 있다.

The State shall lease land to foreign investors, foreign-invested enterprises and foreign-invested banks for their establishment. The term of lease shall be 50 years at maximum. Land so leased may be assigned or mortgaged during the term of lease subject to the approval of the land leasing institution.

Article 16 (Employment)
외국인투자기업과 외국투자은행은 종업원을 우리 나라 로력으로 채용하여야 한다. 일부 관리인원과 특수한 직종의 기술자, 기능공은 투자관리기관과 합의하고 다른 나라 로력으로 채용할수도 있다.

A foreign-invested enterprise and a foreign-invested bank shall employ the labour of the DPRK. Some of the managerial personnel, and technicians and skilled workers for special jobs may be employed from abroad subject to the agreement of the investment management organ.

Article 17 (Taxation)
외국투자가와 외국인투자기업, 외국기업, 외국투자은행은 기업소득세, 거래세, 재산세 같은 세금을 정해진데 따라 납부하여야 한다.

Foreign investors, foreign-invested enterprises, foreign enterprises and foreign-invested banks shall pay income tax, turnover tax and property tax according to the prescribed rates.

Article 18 (Reinvestment)
외국투자가는 리윤의 일부 또는 전부를 우리 나라에 재투자할 수 있다. 이 경우 재투자분에 대하여 이미 납부한 소득세의 일부 또는 전부를 돌려받을 수 있다.

Foreign investors may reinvest the whole or part of their profits in the DPRK. In this case the whole or part of the income tax already paid on the reinvested amount shall be refunded.

Article 19 (Protection of Investment Property)
국가는 외국투자가와 외국인투자기업, 외국투자은행의 재산을 국유화하거나 거두어들이지 않는다. 사회공공의 리익과 관련하여 부득이하게 거두어들이려 할 경우에는 사전에 통지하며 법적절차를 거쳐 그 가치를 충분히 보상해준다.

The State shall not nationalize or expropriate the properties of foreign investors, foreign-invested enterprises and banks. Should expropriation is required for public interests, notification thereof shall be made in advance and sufficient compensation for its value shall be made through legal procedures.

Article 20 (Remittance)
외국투자가가 기업운영 또는 은행업무에서 얻은 합법적리윤과 기타 소득, 기업 또는 은행을 청산하고 남은 자금은 제한없이 우리 나라 령역밖으로 송금할수 있다.

Legitimate profits and other income earned by a foreign investor from business or banking operations, and any money that remains after the liquidation of a business or bank may be remitted out of the territory of the DPRK without any restrictions.

Article 21 (Confidentiality)
국가는 외국인투자기업과 외국투자은행의 경영활동과 관련한 비밀을 법적으로 보장하며 외국투자가와 합의없이 공개하지 않도록 한다.

The State shall protect by law the business secrets of foreign-invested enterprises and banks, and shall not disclose them without the consent of the foreign investor concerned.

Article 22 (Settlement of Disputes)
외국투자와 관련한 의견상이는 협의의 방법으로 해결한다. 협의의 방법으로 해결할수 없을 경우에는 조정, 중재, 재판의 방법으로 해결한다.

Any disagreement concerning foreign investment shall be settled through consultation. In case of failure in consultation, the disagreement shall be settled through mediation, arbitration or legal procedures.

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Core Structure of the Sarvarthapedia Knowledge Network

Foundational Legal Core

Foreign Investment Law (DPRK)

• Central node: establishes the legal ontology of foreign economic participation
• Anchors three primary domains:
  • Investment Definition System
  • Institutional Governance System
  • Rights–Obligations Framework

Concept Cluster 1: Ontology of Investment (Article 2)

Foreign Investment as Economic Transfer

• Core concept: movement of capital + property rights + know-how
• Linked to:
  • Property Valuation (Article 12)
  • Technology Transfer (Article 7)
  • Economic Activity Purpose (Article 6)

Types of Investors

• Foreign corporate bodies
• Foreign individuals
• Overseas Koreans

Cross-links:

• Legal Capacity (Article 14)
• Immigration Facilitation (Article 10)

Enterprise Typology Network

• Contractual Joint Venture
• Equity Joint Venture
• Wholly Foreign-Owned Enterprise
• Foreign Enterprise

Interconnections:

• Ownership vs Control Spectrum
• Profit Distribution Logic
• Management Authority Structure

Financial Institutions Subcluster

• Joint Venture Bank
• Foreign-Owned Bank
• Foreign Bank Branch

Linked to:

• Capital Circulation (Article 20)
• Regulatory Approval (Article 3)

Special Economic Zone (SEZ)

• Defined as spatial-economic exception
• Connects to:
  • Preferential Treatment (Article 9)
  • Investment Incentives (Article 8)
  • Governance Duality (central + zone authority)

Concept Cluster 2: Institutional Governance (Articles 3, 14)

Investment Management Organ

• Dual structure:
  • Central State Authority
  • SEZ Management Authority

Connections:

• Approval Mechanism (Article 3)
• Labor Regulation (Article 16)
• Land Leasing Authority (Article 15)

Legal Personality System

• Corporate status granted to:
  • Foreign-invested enterprises
  • Banks

Non-corporate entities:

• Branches, offices, agencies

Cross-links:

• Liability Structure
• Jurisdictional Authority
• Dispute Resolution (Article 22)

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Concept Cluster 3: Rights and Protections (Articles 4, 19, 20, 21)

Protection of Investors

• Guarantees:
  • Property security
  • Operational stability

Linked to:

• Non-expropriation Principle (Article 19)
• Compensation Mechanism
• Legal Certainty

Capital Mobility

• Free remittance of:
  • Profits
  • Liquidation proceeds

Connections:

• Taxation System (Article 17)
• Reinvestment Incentives (Article 18)

Confidentiality Regime

• Protection of business secrets
• Linked to:
  • Investor trust
  • Competitive advantage
  • State–investor contractual relations

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Concept Cluster 4: Incentives and Economic Strategy (Articles 7, 8, 9)

Priority Sector Strategy

• High technology
• Infrastructure
• R&D

Connections:

• National Development Policy
• Global Competitiveness
• Industrial Modernization

Incentive Mechanisms

• Tax reductions
• Land-use advantages
• Preferential loans

Linked to:

• SEZ privileges
• Investment attraction policy

SEZ Operational Advantages

• Simplified:
  • Trade flows
  • Labor hiring
  • Taxation
  • Market access

Cross-links:

• Experimental economic governance
• Regulatory flexibility

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Concept Cluster 5: Constraints and Boundaries (Article 11)

Prohibited/Restricted Investments

• National security threats
• Public health risks
• Moral/social concerns
• Environmental violations
• Low-efficiency projects

Connections:

• Sovereignty Protection
• Sustainable Development
• Technological Standards

Concept Cluster 6: Resource and Factor Systems

Property and Valuation (Article 12)

• Forms:
  • Currency
  • Physical assets
  • Intellectual property

Linked to:

• International market pricing
• Contractual agreement

Land System (Article 15)

• Lease-based (max 50 years)
• Transferable/mortgageable with approval

Connections:

• State ownership of land
• Investment security
• Infrastructure development

Labor System (Article 16)

• Primarily domestic labor
• Limited foreign expertise

Cross-links:

• State labor control
• Skill transfer
• Employment policy

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Concept Cluster 7: Financial and Fiscal System

Taxation (Article 17)

• Income tax
• Turnover tax
• Property tax

Connections:

• Incentive reductions (Article 8)
• Reinvestment refunds (Article 18)

Reinvestment Loop

• Profit reinvestment → tax refund

Linked to:

• Capital retention strategy
• Long-term investment cycles

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Concept Cluster 8: Operational Expansion (Article 13)

Transnational Extension

• Branches
• Subsidiaries
• Agencies

Connections:

• Global integration
• Corporate network expansion
• Joint operations

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Concept Cluster 9: Dispute Resolution System (Article 22)

Multi-layered Resolution Path

• Consultation → Mediation → Arbitration → Litigation

Connections:

• Legal certainty
• Investor confidence
• Institutional maturity

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Cross-Cutting Meta-Concepts

State Sovereignty vs Market Openness

• Present in:
  • Investment restrictions
  • Land ownership
  • Labor control

Incentivized Openness

• Seen in:
  • SEZs
  • Tax benefits
  • Profit remittance

Hybrid Economic Model

• Combines:
  • Central planning elements
  • Market-based investment mechanisms

Risk–Reward Balance

• Protections (Articles 4, 19, 20)
• Constraints (Article 11)
• Incentives (Articles 7–9)

Network Summary

Central Hub

• Foreign Investment Law = organizing framework

Primary Axes

• Definition and Ontology
• Governance and Authority
• Rights and Protections
• Incentives and Strategy
• Constraints and Regulation

Systemic Insight

This network reveals a structured attempt to integrate foreign capital into a controlled economic system by:

• Defining clear legal categories
• Ensuring state oversight
• Offering selective incentives
• Maintaining sovereign control over critical resources and labor

The resulting Sarvarthapedia web forms an interconnected legal-economic knowledge system where each article functions as a node linked through governance, incentives, and regulatory logic.

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