The government is seeking to confiscate the full amount of revenue earned by operators of illegal valley facilities as a penalty surcharge, according to reports on the 29th. Under current law, only compensation fees ranging from tens of thousands to hundreds of thousands of won can be imposed, leading to criticism that sanctions are far too weak compared with the revenue from illegal business. The aim is to introduce a penalty surcharge system to block unjust gains at the source.
According to reporting by ChosunBiz, the Ministry of Climate, Energy and Environment and the Ministry of the Interior and Safety are preparing a plan to impose a penalty surcharge of up to 100% of sales on individuals and companies that illegally occupy valleys and rivers to gain financial benefits. To do this, they plan to revise their respective governing statutes, the River Act and the Small River Maintenance Act.
There is no legal basis under current law to impose a penalty surcharge. Under Article 37 of the River Act and Article 22 of the Small River Maintenance Act, authorities can only collect a compensation fee amounting to 1.2 times the occupancy fee from individuals and companies that occupy valleys and rivers without an occupancy permit. This equals about 0.75% to 2.5% of land prices and falls far short of the profits from illegal occupation, rendering it ineffective.
On May 12, President Lee Jae-myung said of illegal valley facilities, "They are monopolizing what belongs to all the people and taking unjust gains," adding, "Wrongdoing does not stop being wrongdoing just because it has continued for a long time. This is what we call 'accumulated ills.'" In February, he also ordered a full reinvestigation of operating conditions, saying, "Conduct an inspection regarding alleged deliberate cover-ups and strictly discipline the responsible public officials and local governments."
If the government cannot accurately calculate illegal gains, it plans to assume annual sales of up to 500 million won and impose a penalty surcharge accordingly. This policy applies to most valleys and rivers nationwide. As of the end of June, the government identified about 91,000 cases of illegal occupation facilities.
A government official said, "To correct the operation of illegal valley facilities, which runs counter to public sentiment, we intend to introduce a punitive penalty surcharge as a 'national normalization task,'" adding, "Our goal is to complete the legal revision process in the first half of next year."