The system is designed to exempt those subject to audit by the Board of Audit and Inspection (government officials, departments and organizations, hereinafter referred to as auditees) from disciplinary measures for their proactive actions when they are found to have carried out their duties in the public interest (such as improving unreasonable regulations), and not to have acted intentionally or by gross negligence (Article 34.3, Board of Audit and Inspection Act)

• 1) The following requirements should be met to grant exemption.
  The auditees should:
• • ① Carry out their duties in the public interest, such as improving unreasonable regulations, and promoting public services
  • ② Perform their duties in a proactive mannerCarry out their duties in the public interest, such as improving unreasonable regulations, and promoting public servicesCarry out their duties in the public interest, such as improving unreasonable regulations, and promoting public services
  • ③ Not have conducted the act intentionally or by gross negligence

Actions are presumed to have been conducted unintentionally and without gross negligence when all of the following requirements are met.

• ① Those subject to the BAI’s audit should not have private interests associated with their duties
• ② There should not be any serious procedural defects while exercising the duties

• 2) When duties are fulfilled according to pre-consultation suggestions, exemptions may be granted U the following conditions are met:
• • ① If the pre-consulting service had been requested for the issue at hand, and the recommendations had been fully carried out according to pre-consultation suggestions
  • ② If the auditee had sufficiently provided all necessary information to ensure an effective pre-consultation
  • ③ If the auditee did not have private interests associated with their duties

When auditees fulfill their duties according to the BAI’s pre-consultation suggestions, they are presumed to have satisfied the requirements to be granted with the exemption, provided that there are no special reasons or circumstances (such as private interest).

Applicants

• ① Central administrative organizations, local governments, public organizations and all organizations subject to the BAI’s audit (as stated in Article 22 and 24 of the “Board of Audit and Inspection Act”), as well as government officials, executives and staff who belong to the aforementioned organizations can apply for the exemption system.
• ② When a request for exemption from disciplinary measures for proactive actions is received, the BAI notifies the applicant of the procedures and schedules while releasing its progress in phases on the BAI website.
• ③ In cases where the BAI decides to exempt the applicant from disciplinary measures, the BAI will officially notify the applicant of its decision.
  * When the BAI decides to grant exemption from disciplinary measures, not based on any request, but through the exercise of its own authority, the auditee will be officially notified of the decision.

• 1) (Legal foundation) Article 6 of the “Rules on Operation of Audit Result Appeals System,” including the System of Exemption from Disciplinary Measures for Proactive Actions (BAI Directive)
• 2) (Composition) Maximum of 30 members, including the Committee chairman appointed by the chairman of the BAI, to serve a one-year term (can be re-appointed for another term)
• 3) (Function) To review and provide advice on cases requesting exemptions from disciplinary measures for proactive actions to determine if they meet requirements. The decision of the Committee is respected as fully as possible.

When City A instituted water reclamation facilities to treat sewage water, it planned to supply reclaimed water for a fee. According to the “Act on Promotion and Support of Water Reuse,” fees for supplying reclaimed water can only be imposed on those who state their desire to use reclaimed water through a demand survey. However, City A supplied the reclaimed water to local companies for a fee without conducting a demand survey, thus placing financial burden on these companies.
As a result of examining whether or not to grant an exemption from disciplinary actions, it was decided that the action of supplying reclaimed water in preference to other water sources can serve the public interest, considering the economic benefit and stability in both public health and water quality management. In addition, the official in charge was recognized to have fulfilled their duties proactively by referencing related laws. As such, the exemption was granted by imposing a warning against the organization instead of against the official.

City B signed a service contract to commission food waste treatment. According to the “Act on Contracts to Which a Local Government is a Party,” even when a negotiated contract is concluded due to a lack of participants in the bid, the contractor should be a licensed business for waste treatment as initially stated in the bid notice. However, City B signed the service contract with company C who was not a licensed waste treatment service provider.
As a result of examining whether or not to grant exemption from disciplinary measures, the action proved to prevent a large amount of complaints and potential confusion over untreated waste, which can occur before a new contract is signed. Therefore, when there was difficulty in immediately finding other companies for re-invitation to bid, the official in charge acted proactively by signing the service contract. In recognition of this proactive action, the exemption was granted by imposing the warning against the organization instead of the official.