The articles of incorporation of a non-profit organization only take effect upon amendment after receiving permission from the competent authority (Article 42, Paragraph 2 of the 「Civil Act」). However, there was a case where a permission application was not processed because different agencies had conflicting views on which one was the competent authority, and the Anti-Corruption and Civil Rights Commission issued a recommendation for corrective measures on October 22. If you are a non-profit organization with offices in various regions, you must first confirm the competent authority before amending your articles of incorporation.
1. Background of the Case
The following details were disclosed in a press release from the Anti-Corruption and Civil Rights Commission, and the names of the corporation and local governments have been withheld.
- 2019: Corporation A was established after receiving permission from Local Government A.
- 2023: While expanding its business area, it moved its main office to the jurisdiction of Local Government B and maintained an office under the jurisdiction of Local Government A (offices in two cities/provinces). Subsequently, Local Government B assumed the role of the competent authority.
- 2026: Applied to Local Government B for permission to amend its articles of incorporation to add new business objectives → Local Government B requested a review from the Ministry of Health and Welfare → The Ministry of Health and Welfare rejected the request, stating it was not within its jurisdiction as the content did not involve expanding the business area → Local Government B also rejected the application.
- Unable to find the competent agency, Corporation A filed a grievance with the Anti-Corruption and Civil Rights Commission.
2. Decision of the Commission: The competent authority is determined by the scope of activities
According to the relevant laws and regulations cited by the Anti-Corruption and Civil Rights Commission, among non-profit corporations under the jurisdiction of the Ministry of Health and Welfare, corporations operating only within one city/province shall have that city/province as the competent authority, and corporations operating in two or more cities/provinces shall have the Ministry of Health and Welfare as the competent authority.
- It was determined that Corporation A’s competent authority changed to the Ministry of Health and Welfare from the time it established offices in two regions in 2023. The Ministry of Health and Welfare’s work manual also states that if the scope of activities expands to multiple cities/provinces, the authority to permit amendments to the articles of incorporation lies with the Ministry of Health and Welfare.
- Since the competent authority is determined based on the scope of the corporation’s activities, not the content of the application, it was viewed that the Ministry of Health and Welfare must process the application, even if the addition of business objectives is unrelated to the expansion of the business area.
- As an administrative agency that receives a civil complaint under the jurisdiction of another agency must transfer it to the competent agency without delay in accordance with Article 16, Paragraph 1 of the “Civil Petitions Treatment Act,” it was determined that Local Government B should have transferred the application to the Ministry of Health and Welfare instead of rejecting it.
3. Recommendations
- Correction Recommendation: The B Local Government canceled the rejection and transferred the application to the Ministry of Health and Welfare; the Ministry of Health and Welfare received and processed the transfer.
- Expression of Opinion for Institutional Improvement: Recommended that the Ministry of Health and Welfare improve the criteria and procedures for determining whether activities occur across multiple cities and provinces.
Since the correction recommendation and the expression of opinion are not legislative amendments, it is ⚠️ necessary to monitor the follow-up measures of the Ministry of Health and Welfare to see when and how the competent authority’s judgment criteria will be reorganized.
4. Points for Non-Profit Corporations to Check
- Check Current Competent Authority: If the area of activity has expanded to two or more cities and provinces due to the relocation of the main office or the establishment of branch offices after incorporation, first check where to apply for permission for changes to the articles of incorporation, changes to officers, or the disposal of fundamental assets.
- In Case of a Rejection Decision: If a rejection occurred on the grounds that the matter is not under their jurisdiction, you may consider requesting a transfer or filing a grievance complaint. Whether a rejection is recognized as a “disposition” and the deadline for filing an objection must be determined on a case-by-case basis.
- Corporations Under Other Ministries: This decision pertains to corporations under the jurisdiction of the Ministry of Health and Welfare. For corporations under other ministries, you must separately check the specific rules for the establishment and supervision of non-profit corporations and the regulations on delegation of authority for each ministry.
- Registration After Changing Articles of Incorporation: If registered matters such as the purpose or office change, a registration of change must be made within 3 weeks under the 「Civil Act」.
Hwang Yunsang administrative agent (administrative scrivener) office provides document preparation/filing services for non-profit corporation incorporation permits, applications for permission to change articles of incorporation, and consultation documents for competent authorities.
This post is an administrative trend guide organized by the Hwang Yunsang administrative agent (administrative scrivener) office based on publicly available data. Whether this applies to individual cases requires verification with the competent authority.