Purpose of Institute

• To improve the national health industry by providing comprehensive and professional support programs
• To strengthen the competitiveness of the national health industry in this global era

Foundation Act

• The Korea Health Industry Development Institute was established pursuant to the Korea Health Industry Development Institute Act. It is a government- funded agency, which aims to contribute to the improvement of the national health care system

Korea Health Industry Development Institute Act

Article 1 (Purpose)

The aims of the act were to establish the Korea Health Industry Development Institute as the primary vehicle for the overall administration of the national health industry. The Act grants authority to the Korea Health Industry Development Institute to undertake vital support programs, which are intended to enhance the delivery of the national health services and to develop the national health industry into a globally-competitive industry.

Article 2 (Legal Personality)

The Korea Health Industry Development Institute (hereinafter called the ‘Institute’) is a corporation.

Article 3 (Establishment)

1. The Institute shall operate in accordance with approved scope of business specified in the Articles of registration. The principal place of business shall be the site of the head office.
2. The registered information on the establishment, according to Article 1, shall be as follows:
   1. Purpose
   2. Designation
   3. Head office and branch offices
   4. Full names and addresses of the officers
   5. Public notices

Article 4 (Office)

1. The site of the head office shall be specified in the Articles of the Institute.
2. The Institute may set up branch offices, if necessary.

Article 5 (The Articles of the Institute)

1. The Articles of the Institute shall specify the following information:
   1. Purpose
   2. Designation
   3. Location of Head office and Branch offices
   4. Services and other related matters
   5. Officers and employees
   6. Board of directors
   7. Financials
   8. Public notices
   9. Internal management regulations
   10. Amending the Articles of the Institute
2. Any proposed amendment to the Articles of the Institute shall obtain the prior approval from the Minister of Health and Welfare.

Article 6 (Services)

1. The Institute shall provide the following services to achieve the purposes of the Article 1:
   1. Health Technology development as well as the commercialization of the developed technologies
   2. Information management services on health industry
   3. Technical assistance for the support and development of venture businesses
   4. Technical assistance for the support and development of venture businesses
   5. Technical assistance for the establishment and management of industrial centers that cater to health and medical sciences
   6. Development of health industry related systems, education, public information, and international cooperation
   7. Health care service improvement
   8. Government-entrusted services
   9. Other related and necessary services to achieve the purposes of the institute.

Article 7 (Officers)

1. The Institute shall have a maximum of eleven (11) officers, including the Chief Director and the President, and one (1) Auditor.
2. The Directors and the Auditor shall all hold a maximum service term of three (3) years
3. The Chief Director, Directors, and the Auditor shall be appointed in accordance with the Articles of the Institute.
4. Subject to Paragraph 1, there shall be a maximum of two (2) full-time Directors, whose duties shall be specified in the Articles of the Institute.
5. The Auditor shall audit the operation and the financial condition of the Institute.

Article 8 (Board of Directors)

1. The Institute shall have a Board of Directors, which will discuss and decide important matters related to its management.
2. The Board of Directors shall consist of directors, including the Chief Director and the President.
3. The Chief director shall call the meeting of the Board of Directors and shall act as the Chairperson.
4. The Chief Director may not serve as the President of the Institute at the same time.
5. The Auditor may attend and give his opinion during the meeting of the Board of Directors.

Article 9 (President)

1. The Institute shall have one (1) President.
2. The President shall represent the Institute, and shall have general power and control over all aspects of the operations of the Institute. The President shall lead and supervise all employees of the Institute.
3. The President of the Institute shall be appointed by the Board of Directors, in accordance with the s Articles of the Institute. The appointment of the President shall require prior approval from the Minister of Health and Welfare.

Article 10 (Appointment and Dismissal of An Employee)

An employee of the Institute may be appointed or dismissed by the President of the Institute, in accordance with the Articles of the Institute.

Article 11 (Funds)

The establishment and operations of the Institute shall be funded through the contribution of government or non-government parties and other revenues.

Article 12 (Contribution)

1. The government shall grant the required amount of contribution that is necessary to meet the expenses for the delivery of services and the operation of the Institute, subject to the approved budget.
2. The Institute shall submit a written request for the following year's proposed budget contribution to the Minister of Health and Welfare every business year, pursuant to the relevant Presidential Decree.

Article 13 (Fiscal year)

The fiscal year of the Institute shall be the same as the accounting year of the government

Article 14 (Service plans)

1. The Institute shall submit the following documents and obtain approval from the Minister of Health and Welfare, pursuant to the relevant Presidential Decree.
   1. Service Plan and Revenue/Expenditure Budget for every business year
   2. Service Status Report and Revenue and Expenditures Report for the Fiscal Year
2. Any proposed change in the contents of the Service Plan specified in the Paragraph 1 Section 1, should indicate the provision to be amended and the reason for the proposed change. The proposed change should be submitted to and approved by the Minister of Health and Welfare

Article 15 (Request for Data)

The Institute may request the data necessary to perform its services from the national or self-governing bodies, government-owned agencies, public organizations, and research or educational institutions.

Article 16 (Confidentiality)

All officers and employees of the Institute, including former officers and employees, shall not expose confidential information obtained while performing his or her duties.

Article 17 (Application of Civil Code)

The rules and regulations not specified here shall apply to general laws of the Articles of the Institute of the Civil Code.

Article 18 (Penalty)

Anyone found violating the Confidentiality clause under Article 16 will be sentenced to a maximum imprisonment of two years or fined not more than ten million won.

Article 19 (Effective Date)

This Act shall be effective on the announcement date. However, Article 4 of the Supplementary Provisions shall be effective on the registered date of the establishment of the Institute.

Article 20 (Establishment of the Institute)

1. The Minister of Health and Welfare shall appoint not more than seven (7) Organizational committee members within 30 days from the effective date of this Act. The Organizational committee shall formulate and implement plans for the establishment of the Institute and shall appoint Directors and the Auditor.
2. The Organizational committee shall draw up the Articles of the Institute and secure the approval of the Minister of Health and Welfare.
3. After obtaining the approval in accordance with Paragraph 2, the Organizational committee shall formally register the establishment of the institute. Immediately after the registration of the Institute, the Organizational committee shall turn over its duties and responsibilities to the President of the Institute.
4. The existence of the Organizational committee shall terminate upon turnover of its duties and responsibilities to the President, subject to paragraph 3.
5. The Korea Institute of Food Hygiene and the Korea Institute of Health Services Management (hereinafter called as “Each Institute”) shall jointly finance the pre-operating expenses prior to the establishment of the Institute.

Article 21 (Transfer of Rights and Responsibilities)

1. In the enforcement of this Act, each Institute may request the Minister of Health and Welfare to approve the resolution of each Institute’s Board of Directors authorizing the Institute established by this Act to take over each Institute’s property and rights and responsibilities.
2. Upon the approval of the Minister of Health and Welfare, each Institute shall be liquidated, regardless of the regulations on disorganization and liquidation in the Civil Code.
3. Subject to Paragraph 2, the value of the property transferred to the Institute shall be equivalent to the book value of the property on the day before the registered date of the Institute's establishment.

Article 22 (Revision of Other Regulations)

1. The Food Sanitation Act shall be revised as follows: Section 3 of Chapter 10 (Article 54 Paragraph 2 and Article 54 Paragraph 3) shall be deleted.
2. The Health and Medical Technology Development Act shall be revised as follows: Under Article 7 Paragraph 1, ‘research institution’ shall be changed into ‘Korea Health Industry Development Institute’ pursuant to the Health Industry Development Institute Act.’

Health Industry Development Act Enforcement Ordinance

Health Industry Development Act Enforcement Ordinance (the 16105th Presidential Decree enacted on Feb. 5, 1999)

Article 1 (Purpose)

This decree aims to enforce and regulate the Korea Health Industry Development Institute Act.

Article 2 (Request for Annual Contribution Budget)

Pursuant to Article 12 Paragraph 2 of the Korea Health Industry Development Institute Act (hereinafter called as the ‘Act’), the Korea Health Industry Development Institute (hereinafter called as the ‘Institute’) shall submit a written request for the following year’s proposed contribution budget to the Minister of Health and Welfare, by April 30 of every year, with the following documents:

1. Service plan for the next year
2. Projected balance sheet and income statement for the next year
3. Other supporting documents

Article 3 (Contribution Budget Notice)

The Minister of Health and Welfare shall notify the Institute upon confirmation of the approved contribution budget for the next year.

Article 4 (Application for Availment Contribution)

The Institute shall submit an application for the quarterly execution plan pertaining to the availment of the contribution budget to the Minister of Health and Welfare.

Article 5 (Handling Financial Surplus)

The Institute may carry forward any available financial surplus at the end of the current accounting year to the following year, to make up for the losses brought forward from the previous year, or to convert it into the permanent property.

Article 6 (Submission of Service plan and Budget report)

1. According to Article 14 Paragraph 1 of the Act, the Institute must submit the service plan and revenue and expenditure budget report for the next year to the Minister of Health and Welfare, before the start of every service year.
2. Subject to Paragraph 1, the service plan should specify goals, policies, and key points of the service and the required budget.

Article 7 (Submission of Statement of Accounts)

The Institute shall submit the current year’s audited revenue and expenditures report, along with the following documents, to the Minister of Health and Welfare, by March 31 of the next year.

1. Balance sheet and income statemen
2. t for the current year
3. Comparative table between the budgeted service plan and the actual results for the current year
4. Written opinions of the auditor and of the certified accountant who performed the audit
5. Other references and supporting documents that can confirm the contents of statements of accounts

Supplementary Provisions

Article 1 (Enforcement Date)

This decree shall be effective on the announcement date.

Article 2 (Interim Measures on The Submission of The Service Plan and Budget Report)

Notwithstanding the provisions of Article 6, the Institute shall submit the service plan and the budget report for the first service year following the implementation of this decree to the Minister of Health and Welfare, within 30 days from the establishment of the Institute.