1. Reason for proposal

Reorganization of deduction equation and limit to achieve the purpose of original adoption of the foreign exchange integrity charge system to encourage foreign exchange transactions

2. Main contents

A. Revision of charge deduction calculation method to encourage foreign exchange transactions(Article 2-11-2.2)

 ㅇ In relation to KRW-Yuan spot market makers, the equation for deduction related to KRW-Yuan transaction amount (No. 1) is amended in favor of customer transactions; the subjects of deduction (No. 2) of balance in Yuan non-depository liabilities with expiration period of less than one year are limited to clearing banks, etc.

 ㅇ Deduction is established in proportion to KRW-USD both-direction transaction performances for leading banks in the KRW-USD spot market (No. 3).

B. Revision of charge deduction limit to encourage foreign exchange transactions(Article 2-11-2.4)

 ㅇ The limit of the sum of deduction of KRW-Yuan spot market makers (Articles 2-11-2.1 and 2-11-2.2) is amended from 30% of balance in Yuan non-depository foreign liabilities with expiration period of less than one year to 20% of the same

C. Extension of period to apply charge deduction to encourage foreign exchange transactions(Article 2-11-2.5)

 ㅇ The application period is extended by two (2) years from business year 2021 to business year 2023

D. Clarification of basis for selection of foreign exchange agents to encourage foreign exchange transactions 

(Article 10-20)

 ㅇ Clarification of basis for selection of KRW-Yuan spot market makers and leading banks in KRW-USD spot market to which charge deduction is applied.