Unauthorized Occupancy of State-Owned Land Met With Penalty Reductions

[Anchor]

The government leases state-owned land and collects rent. However, it has been confirmed that the Korea Asset Management Corporation (KAMCO), which is tasked with managing these properties, has been cutting penalty fees imposed on individuals and entities illegally occupying state land.

Reporter Lee Tae-gwon has the exclusive scoop on how this happened.

[Reporter]

This is a private parking lot near Gimhae International Airport in Busan.

Covering 507 square meters, or about 150 pyeong, this plot of land is owned by the state.

It was found that the business had only been paying lease fees for a 70-square-meter portion of this state-owned land.

The remaining 437 square meters had been illegally occupied and used for business operations for at least five years without any contract.

[Unauthorized Occupant: The lower section used to be a construction zone during past projects. I thought lease fees were only being charged for the parts excluding that area. So I thought it was twenty pyeong....]

In January, KAMCO, the agency responsible for managing state-owned land, confirmed the illegal occupation and imposed penalty fees amounting to approximately 133 million won.

However, after the business requested a reduction on the grounds of being a small business, KAMCO slashed the penalty to about one-third of the original amount.

KAMCO cited a notice issued by the Ministry of Finance and Economy enacted in 2020 as the basis for its decision.

To ease the burden on small businesses, the relevant notice allows state land lease fees to be lowered from 3% to 1% of the property's value, with reductions capped at a maximum of 20 million won per year.

However, because penalty fees were calculated based on these discounted lease fees, even unauthorized occupants ended up benefiting from the system.

Last year, the Board of Audit and Inspection announced that 79,000 parcels of land, or 10% of all state-owned land managed by KAMCO, were being illegally occupied. Yet, KAMCO does not separately track how much penalty revenue has been reduced through this method.

[Park Min-gyu / Member, National Assembly Policy Committee (Democratic Party of Korea): The problem is that a system originally created to help struggling small businesses has led to unjustified penalty reductions for illegal occupiers of state land.]

KAMCO maintains that reducing penalties is necessary to encourage illegal occupants to clear the unauthorized use and transition into formal contracts.

The Ministry of Finance and Economy stated that lowering penalty fees even for unauthorized occupants runs counter to the public sense of justice, adding that it will raise the criteria for calculating penalties and review the imposition standards once again.

(Video by: Lee Byung-joo | Video Editing by: Cho Mu-hwan | Design by: Kang Yoon-jung)
※ Please note: This article was translated by AI and may contain errors.