This is the full text of the Currency Circulation Law of the Democratic People’s Republic of Korea.
CURRENCY CIRCULATION LAW OF THE
DEMOCRATIC PEOPLE’S REPUBLIC OF KOREA
Adopted on November 26, Juche 87 (1998) through Decree No. 285 of the Standing Committee of the Supreme People’s Assembly
Amended and supplemented on June 5, Juche 92 (2003) through Decree No. 3789 of the Standing Committee of the Supreme People’s Assembly
Amended and supplemented on November 3, Juche 98 (2009) through Decree No. 392 of the Standing Committee of the Supreme People’s Assembly
CHAPTER 1
BASICS OF THE CURRENCY CIRCULATION LAW
ARTICLE 1 (Mission of the Currency Circulation Law) The Currency Circulation Law of the Democratic People’s Republic of Korea contributes to consolidating the currency circulation, reasonably conducting the economic management and enhancing the people’s lives by strictly setting up the system and order in cash and cashless circulation.
ARTICLE 2 (Circulated currency) The circulated currency in the Democratic People’s Republic of Korea is the central banknotes. The basic unit of the central banknotes is the “won” and its supplementary unit is the “chon”. The state acts to strengthen the independent currency system by increasing the function and role of currency.
ARTICLE 3 (Principle of organizing currency circulation) Currency circulation in the Democratic People’s Republic of Korea is achieved through cash circulation and cashless circulation. The state organizes cash circulation and cashless circulation according to their characteristics and correctly combines them.
ARTICLE 4 (Principle of cash circulation) The smooth cash circulation is the basic way to guarantee stability of the currency. The state acts to strengthen centralized discipline and correctly implement the local cash circulation responsibility system in cash circulation.
ARTICLE 5 (Principle of cashless circulation) The proper organization of cashless circulation is the necessary demand in guaranteeing the circulation of goods between institutions, enterprises and organizations in a planned way. The state acts to expand the scope of the cashless circulation system as the size of the economy grows and the connections between sectors of the people’s economy and regions become closer.
ARTICLE 6 (Principle of currency cycling) The guarantee of goods is the basic assurance to consolidate the currency circulation. The state acts to increase the purchasing power of the currency and promote its cycling by increasing the production of goods.
ARTICLE 7 (Principle of prohibiting the circulation of currencies of other countries) Currencies of other countries may not be circulated within the territory of the Democratic People’s Republic of Korea. The state acts to determine the exchange rate of the central banknotes and currencies of other countries.
ARTICLE 8 (Principle of managing central banknotes) The state acts to properly manage the central banknotes and strengthen the control on them. The central banknotes may not be taken to other countries. However, specimens of the central banknotes and the central banknotes that are no longer circulated may be taken to other countries according to the agreement entered with banks of other countries.
ARTICLE 9 (Exchanges and cooperation in the field of currency circulation) The state develops exchanges and cooperation with other countries and international organizations in the field of currency circulation.
ARTICLE 10 (Currency circulation in special economic zones) Currency circulation in special economic zones follow the relevant regulations.
CHAPTER 2
CASH CIRCULATION
ARTICLE 11 (Organization of cash circulation) Cash circulation is a form of currency circulation applied in the transaction of goods between institutions, enterprises and organizations. The Central Bank should organize cash circulation in a planned way.
ARTICLE 12 (Preparation of cash plan) The cash plan is set up for every region and item every year based on the people’s economic plan and the financial plan. The Central Bank should set up a cash plan and have it approved by the Cabinet.
ARTICLE 13 (Execution of cash plan) The central banking institution, institutions, enterprises and organizations should correctly execute the cash plan. The Central Bank should normally control the execution of the cash plan.
ARTICLE 14 (Adjustment of cash circulation) The Central Bank should guarantee the proper amount of cash circulation by adjusting the cash circulation in a planned way. The adjustment of the cash circulation should be conducted using adjusted currency within the scope of the cash plan. In case that there is an intention to adjust the cash circulation in excess of the cash plan, it should be approved by the Cabinet.
ARTICLE 15 (Issuance of securities) The Central Bank may issue securities to adjust the cash circulation. In this case, it should be approved by the relevant institution.
ARTICLE 16 (Guarantee of cash income) Institutions, enterprises and organizations should actively increase the income from the sale of goods, social provisions and convenience services. The people’s consumer goods production plan and the goods circulation amount plan should be completely executed.
ARTICLE 17 (Necessary cash income for local housekeeping) The local power institution and the central banking institution should guarantee the necessary cash for the local housekeeping using its own cash by completely mobilizing sources of income.
ARTICLE 18 (Cash deposit) Institutions, enterprises and organizations should promptly deposit their earned cash to the central banking institution. The central banking institution should control the deposit period of institutions, enterprises and organizations and accept cash.
ARTICLE 19 (Cash spending) Institutions, enterprises and organizations that intend to use cash should submit an application for cash spending to the central banking institution. The central banking institution should correctly review the cash spending application and spend cash. Spent cash should be used according to the determined items and standards.
ARTICLE 20 (Cash spending) The central banking institution should determine the spending date for every institution, enterprise and organization to guarantee uniformity in cash spending for every period. The date of spending the funds for work pay in large-scale enterprises may even be determined for every workplace.
ARTICLE 21 (Cash storage) Institutions, enterprises and organizations should correctly register cash income and spending and store cash in vaults that are guaranteed to be secured. The management of vaults is conducted only by designated officials.
ARTICLE 22 (Regulation of cash retention limit) The cash retention limit of the central banking institution is determined by the Central Bank. However, the cash retention limit of institutions, enterprises and organizations is determined by the relevant central banking institution.
ARTICLE 23 (Compliance with cash retention limit) Institutions, enterprises and organizations should strictly comply with the cash retention limit. Cash beyond the retention limit should be deposited or saved in the central banking institution.
ARTICLE 24 (Mobilization of idle currency) The local power institution and the central banking institution should actively mobilize idle currency by organizing the saving and insurance work in a mass-oriented way.
ARTICLE 25 (Guarantee of secrecy and credibility of savings) Citizens should consciously participate in saving. The central banking institution should guarantee the secrecy and credibility of savings.
ARTICLE 26 (Cash transportation) The central banking institution, institutions, enterprises and organizations should securely transport cash. Transportation institutions requested to transport cash should promptly transport cash. In necessary cases, the transportation of cash may be conducted under the escort of armed guards.
ARTICLE 27 (Exchange and recovery of money) The Central Bank should promptly exchange and recover worn out money and ruined money. Citizens should securely handle money.
CHAPTER 3
CASHLESS CIRCULATION
ARTICLE 28 (Organization of cashless circulation) Cashless circulation is a form of currency circulation applied in the transactions of means of production between institutions, enterprises and organizations. The Central Bank should hold the currency funds in a unified way and reasonably organize the cashless circulation.
ARTICLE 29 (Cashless payments) Cashless circulation is implemented through cashless payments. Cashless payments are done by the central banking institution.
ARTICLE 30 (Opening of accounts) Institutions, enterprises and organizations should open accounts with the central banking institution. Supplementary accounts may also be opened according to the necessity.
ARTICLE 31 (Approval of accounts) Institutions, enterprises and organizations that intend to open an account should submit an application for approving the account to the central banking institution. The central banking institution should review the account approval application and approve the account.
ARTICLE 32 (Payment of price of supplies according to plan and contracts) The central banking institution should properly pay the price of circulating supplies according to the people’s economic plan and contracts. Supplies that are not in the people’s economic plan and contracts may not be paid.
ARTICLE 33 (Spending and claim of currency funds) Institutions, enterprises and organizations that intend to spend or claim currency funds should make a payment document and submit it to the central banking institution. The central banking institution should review the payment document and pay only in the case that there are currency funds in the account.
ARTICLE 34 (Exchange payment) The Central Bank organizes the exchange payment between branches to promote the cycling of currency funds. The central banking institution should promptly conduct payments.
ARTICLE 35 (State budget payment) The central banking institution should correctly conduct payments related with the execution of the state budget. The payment of income and spending in the state budget should be conducted according to the budget affiliation and spending should be conducted only within the scope of the income.
ARTICLE 36 (Improvement of payment method) The central banking institution should reduce the payment turnover to access the fund circulation in the supply circulation. The Central Bank should improve the payment method to meet the demand of the development of reality.
CHAPTER 4
GUIDANCE AND CONTROL ON CURRENCY CIRCULATION WORK
ARTICLE 37 (Basic demand of guidance and control on currency circulation work) The proper guidance and control on the currency circulation work is an important way to smoothly guarantee the currency circulation. The state acts to set up the guidance system and strengthen control in the currency circulation work.
ARTICLE 38 (Guidance institution for currency circulation work) The guidance on the currency circulation work is conducted by the Central Bank under the unified guidance of the Cabinet. The Central Bank should guide to normally control the state of currency circulation and smoothly guarantee the supply circulation using less funds.
ARTICLE 39 (Guidance on spending and use of funds) The central banking institution should guide to have institutions, enterprises and organization spend work pay funds including living expenses funds to meet the demands of socialist distribution principles and correctly use currency funds.
ARTICLE 40 (Supervision and control on currency circulation work) The supervision and control on the currency circulation work is conducted by the relevant supervisory and control institution. The central banking institution and the relevant supervisory and control institution should strictly supervise and control the currency circulation work.
ARTICLE 41 (Recovery of sums of money and compensation for losses) In case that currency funds were misused, wasted or lost, the relevant sum of money is recovered or the loss is compensated.
ARTICLE 42 (Payment of sum of money to state treasury and suspension of bank transaction) In the following cases, the relevant sum of money is paid to the state treasury or the bank transaction is suspended.
- In case that a contract was violated and there was a transaction of supplies beyond the retention limit
- In case that there was a transaction of supplies in violation of the people’s economic plan and contracts
- In case that a construction was not planned
- In case that funds were unfairly received by presenting a false construction record
ARTICLE 43 (Administrative or criminal responsibility) Responsible officials of institutions, enterprises and organizations and individual citizens who cause severe consequences to the currency circulation in violation of this law receive administrative or criminal responsibility according to the severity.
DPRKnotes 