DEFENSE Facilities and Areas and the Status of
United States Armed Forces Agreement Between the
UNITED STATES OF AMERICA
Special Measures relating to Article V of the
Agreement under Article IV of the
Mutual Defense Treaty
Signed at Seoul February 2, 2014 with Implementation Arrangement and Exchanges of Notes and Correcting Notes
NOTE BY THE DEPARTMENT OF STATE
Pursuant to Public Law 89—497, approved July 8, 1966 (80 Stat. 271; 1 U.S.C. 113)— “. . .the Treaties and Other International Acts Series issued under the authority of the Secretary of State shall be competent evidence . . . of the treaties, international agreements other than treaties, and proclamations by the President of such treaties and international agreements other than treaties, as the case may be, therein contained, in all the courts of law and equity and of maritime jurisdiction, and in all the tribunals and public offices of the United States, and of the several States, without any further proof or authentication thereof.”
REPUBLIC OF KOREA
Defense: Facilities and Areas and the Status of United States Armed Forces Agreement for special measures relating to Article V of the agreement under Article IV of the Mutual Defense Treaty. Signed at Seoul February 2, 2014;
Entered into force June 18, 2014. With implementation arrangement and exchanges of notes and correcting notes.
AGREEMENT BETWEEN THE UNITED STATES OF AMERICA AND THE
REPUBLIC OF KOREA CONCERNING SPECIAL MEASURES RELATING
TO ARTICLE V OF THE AGREEMENT UNDER ARTICLE IV OF THE
MUTUAL DEFENSE TREATY BETWEEN THE UNITED STATES OF
AMERICA AND THE REPUBLIC OF KOREA REGARDING FACILITIES
AND AREAS AND THE STATUS. OF UNITED STATES ARMED FORCES IN
1 HE REPUBLIC OF KOREA
The United States of America and the Republic of Korea (hereinafter referred
to as "the Parties") have agreed to take the following special measures relating to
Article V of the Agreement under Article IV of the Mutual Defense "Freaty between
the United States of America and the Republic of Korea Regarding Facilities and
Areas and the Status of United States Armed Forces in the Republic of Korea
(hereinafter referred to as "the Status of Forces Agreement"), signed at Seoul on July
9, 1966., as amended.. which sets forth the principles on the sharing of expenditures-
incident to the maintenance of the United States Armed Forces in, the Republic of
Korea, in recognition of the goal of a: strong and mutual commitment to: the United
Slates of America - Republic of Korea alliance.
Article I
The. Republic of Korea Shall bear, for the duration of this Agreement, as a
special measure relating to Article V . of the Status a Forces. Agreement, a part of the
expenditures associated with the stationing, of the United States Armed Forces in the
Republic of Korea. The contribution of the Republic of Korea shall be categorized
into Labor Cost Sharing; Logistics. Cost Sharing. and Republic. of Korea Funded.
Construction (ROKFC). Implementation of this Agreement shall be: in accordance
with .a separate implementation arrangement between the concerned authorities of the
Parties.
The Parties shall put- in utmost efforts to enhance accountability and
transparency for implementation of this Agreement. In this regard, the Exchange of
Notes on System Improvements shall be adopted and enter into force at the same date
as this Agreement.
Article II
This Agreement shall determine the contribution of the Republic of Korea for
2014 through 2018. The contribution of the Republic of Korea for 2014 is 920 billion
Korean Won. The 2015 through 2018 contributions shall be determined by increasing
the contribution of the previous year by the inflation rate (Consumer Price Index)
published by Statistics Korea using the 2013 rate for the 2015 contribution, the 2014
rate for 2016, the 2015 rate for 2017, and the 2016 rate for 2018. Further,: the inflation
rate used for any given year shall not exceed four percent.
Article III
The Labor Cost Sharing contributions shall consist of cash support and the
Logistics Cost Sharing contributions shall consist of in-kind support. Republic of
Korea Funded Construction shall consist of cash contributions and in-kind
contributions.. In this regard. the Exchange of Notes on ROKFC Implementation
Principles,shall be adopted and enter into force on the same date as this Agreement. If
unexecuted in-kind contributions remain at the end of the year; those contributions
shall roll over to the next year. The concerned authorities of the Parties shall put in
their utmost efforts to minimize unexecuted contributions.
Each. year's Labor Cost Sharing payments shall be made: in three equal
payments on or before April 1, June 1, and August 1 of that year. ROKFC cash
contributions, shall be paid on March I of each program year.
Article IV
All materials, supplies, equipment, and services provided as part of the in-••
kind contribution shall be exempt from Republic of Korea taxes, or provided on an
after-tax basis. Such materials, supplies, equipment, and services procured by the
Government of the Republic of Korea shall be exempt from individual consumption
taxes and value added taxes. In the case of value Added taxes, the zero rate shall be
applied. if taxes are levied against any such materials, supplies, equipment, or
services, payment of such taxes shall not be made from cost-sharing funding.
Article V
This Agreerrierit sh#J1 entpr into force upon the date of the exchange of written
notifications by the Parties that their respective domestic legal procedures necessary
for the entry into force of this Agreement have been completed, and shall remain in
force until December 31, 2018.
The termination of this Agreement shall not, affect the carrying out of any
Logistics. Cost Sharing contributions or Republic. of Korea Funded. Construction:
projects which are selected every year in accordance with the agreed procedures under
this Agreement, and not fully executed as of the date of termination of this
Agreement
Article VI
The Parties may consult on all matters, regarding this Agreement through the
Joint Committee provided for in Paragraph I of Article XXVIII of the Status of Forces
Agreement, or through the Joint Cost-Sharing Committee, which is composed of
representatives appointed by the Parties.
Article VII
This. Agreement may be, revised and amended by: written agreement of the
Parties. Such amendments shall enter into force pursuant to the process provided in
Article V.
IN WITNESS WHEREOF, the undersigned, duly authorized for the purpose,
have signed this Agreement.
DONE at S e"I this 2114 day of Ft,imet417 20 19- in duplicate, in
the English and Korean lartgua.ges, both texts being equally authentic.
fORTEIEUNIITD STATES OF AMERICA FOR THE REPUBLIC OF KOREA
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Implementation Arrangement for the Special Measures Agreement
Implementation Arrangement for the Special Measures Agreement
This arrangement shall be used to implement the Agreement between the United States of America and the Republic of Korea concerning Special Measures Relating to Article V of the Agreement under Article IV of the Mutual Defense Treaty between the United States of America and the Republic of Korea regarding Facilities and Areas and the Status of United States of America Armed Forces in the Republic of Korea (hereinafter referred to as "SMA"), signed on February 2, 2014, and the Exchange of Notes on System Improvements and the Exchange of Notes on ROKFC Implementation Principles under the Agreement concerning Special Measures relating to Article V of the Agreement under Article IV of the Mutual Defense Treaty between the United States of America and the Republic of Korea regarding Facilities and Areas and the Status of United States Armed Forces in the Republic of Korea both exchanged on February 26, 2014 (hereinafter referred to as "Exchange of Notes on System Improvements" and "Exchange of Notes on ROKFC Implementation Principles," respectively).
1. The Republic of Korea (ROK) Ministry of National Defense (MND) and U.S. Forces Korea (USFK) shall comprehensively review and assess the USFK allocation requirements for the three cost-sharing categories (Labor Cost Sharing, Logistics Cost Sharing (LCS), and ROK Funded Construction (ROKFC)), based on relevant documents and materials, through the Joint Cost Sharing Committee.
a. FOr the comprehensive review and assessment on the amount of allocations, USFK shall provide relevant materials no later than two (2) weeks prior to the Joint Cost Sharing Committee session. At this time, USFK shall provide ROK MND detailed materials that can serve as a basis for the allocations. Relevant materials for Labor Cost Sharing include the number of employees to be supported by SMA funds, estimated cost of these employees, and explanation of known adjustments to the number of employees and pay. Relevant materials for ROKFC include the draft project list and brief project descriptions. Relevant materials for LCS include the individual project list.
b. In accordance with this procedure, USFK shall provide ROK MND the 2014 allocation for each cost-sharing category within 45 days of the SMA entering into force. As for the allocations for each category from 2015 to 2018, USFK shall provide ROK MND the estimated amount of allocations for the three cost sharing categories by March 15 of the year before the year of execution. The final amount of allocations shall be provided by August 31 of the year before the year of execution taking into full consideration the aforementioned joint review and assessment. When the amount of allocation for each cost-sharing category is being determined, the allocation for Labor Cost Sharing shall be reviewed and assessed first.
2. The ROK SMA contribution shall be paid in Korean Won and distributed among the following categories:
a. Labor Cost Sharing.
Labor Cost Sharing contributions shall be paid in cash. Taking into consideration that a significant portion of SMA contribution is provided for labor cost sharing, USFK shall continue
to endeavor to enhance the welfare and well-being of its Korean National workforce and shall not terminate employment unless there is just cause or unless such employment is inconsistent with the military requirements of the U.S. Aimed Forces. When military requirements make reductions necessary, USFK shall endeavor to minimize employee terminations to the extent possible. Contributions provided by the ROK shall be used solely for salaries and benefits of the USFK Korean National employees in the ROK. USFK shall provide an annual execution report for the previous year to the Programming and Budgeting Bureau of ROK MND (Director General of Programming and Budgeting Bureau) not later than March 1 for the previous year. The annual execution report shall include details such as the number of employees that received support from the SMA program, payment distribution by organization and pay category, distribution of employees by position, number of employees for each pay grade, and explanation of adjustments in the number of employees and pay. The total amount of the ROK contribution shall be no more than seventy-five (75) percent of the labor costs for USFK's Korean National work force.
b. Republic of Korea Funded Construction (ROKFC)
The ROKFC program is a cash and in-kind program. As stated in Principle 6 of the Exchange of Notes on ROKFC Implementation Principles, design and construction oversight, which average twelve (12) percent of the total project costs, are paid by the ROK in cash. Other ROKFC contributions shall be provided in-kind, in principle.
In accordance with Principle 9 of the Exchange of Notes on ROKFC Implementation, additional cash contributions for ROKFC shall be made available in exceptional cases where ROK MND and USFK agree through consultation that specific military facilities require U.S. construction award and implementation due to military needs and requirements and there is no sufficient cash reserve available for that purpose. ROK MND and USFK agree that the funds cannot be used to construct, expand, repair, or manage recreation facilities, such as clubs, golf courses, theaters, and bowling alleys.
Projects shall be initially selected and prioritized by the USFK Commander. ROK MND and USFK shall review and discuss ROKFC projects through the Joint Coordinating Group (JCG). USFK shall submit a draft construction projects list, initial project design list, and brief project descriptions to ROK MND by November 30 two years prior to the year of execution through a session of the JCG. USFK shall submit its final draft construction project list to ROK MND by August 31 of the year before the year of execution. Concerns may be elevated to the Joint Cost Sharing Committee no later than October 1 of the year before the year of execution. If unresolved, those concerns may be elevated to the Minister of National Defense and the USFK Commander for resolution no later than November 1 of the year before the year of execution. Based on, and incorporating the aforementioned consultation and coordination, USFK shall submit its final construction project list to ROK MND by November 30 of the year before the year of execution. Projects shall be planned, reviewed, and executed in accordance with the Exchange of Notes on System Improvements and the designated principles of in-kind funding implementation as memorialized in the Exchange of Notes on ROKFC Implementation Principles, dated February 26, 2014. ROK MND and USFK each shall appoint an appropriate senior level official to co-chair the Joint Coordinating Group. The cash contributions provided by
the ROK shall be used by the United States of America to supervise and execute design and construction of projects in the ROK for the use of the U.S. Armed Forces.
Korean materials shall be used to the maximum extent practicable, provided they meet applicable U.S. and Korean standards.
USFK shall provide an information copy of the draft project list within seven days of the USFK Commander approval. The final list shall be provided upon approval by U.S. authorities. Copies of all construction contracts and contract modifications awarded in the in-kind ROKFC program and quarterly execution reports shall be provided to the USFK Assistant Chief of Staff, Engineer. Copies of all construction contracts and contract modifications awarded with the cash ROKFC contribution and quarterly execution reports shall be provided to ROK MND (Director General of the Military Installations Planning Bureau). Quarterly execution reports shall be in accordance with the form developed by ROK MND and USFK.
Environmental issues are important. USFK and ROK MND shall make strong efforts to use the ROKFC contribution in constructing new facilities that take into account environmental protection.
Facilities constructed under the ROKFC program shall be granted to the United States under Article H of the Status of Forces Agreement. The facilities shall be considered as being "provided by the Republic of Korea" for purposes of the Agreed Minutes to Article IV of the Status of Forces Agreement and shall be returned to the Republic of Korea when they are no longer needed for the purposes of the Status of Forces Agreement.
Implementation of the ROKFC in-kind program shall be in accordance with a separate in-kind construction implementing agreement between the ROK MND and USFK.
c. Logistics Cost-Sharing (LCS)
The LCS contributions are provided in-kind.
Under the LCS program, the ROK MND Logistics Management Bureau shall furnish equipment, supplies, and services in categories such as: Single Ammunition Logistics System- Korea (SALS-K); Munitions Activities Gained through Negotiations under U.S. and ROK Memorandum of Understanding (MAGNUM); petroleum, oils, and lubricants distribution and storage; transportation; repair and maintenance services; certain agreed rents excluding family housing; a portion of base operations support; war reserve materiel maintenance; vehicle, equipment, and materiel purchases; and facility sustainment services. Projects and implementation details on the aforementioned categories shall be in accordance with a separate LCS implementing agreement between ROK MND and USFK. All projects to be executed in the year of execution shall be confirmed by USFK and thereafter be approved by ROK MND no later than December 15 of the year before the year of execution. ROK MND acknowledges there may be changes to the original project list based on unforeseen events during the execution year.
USFK shall order the equipment, supplies, and services based on contracts USFK solicits and negotiates. USFK makes contract source selection decisions, prepares contract documents, and submits to ROK MND for final approval. USFK shall issue the Inspection Report to the contractor after agreed-upon periods for each project. The contractor shall provide USFK the invoice, and USFK shall provide ROK MND the Inspection Report and the copy of the invoice. ROK MND shall exercise a carryover process of funds into the subsequent calendar year for work or products that are on a contract but cannot be delivered by December 31 of the program year. ROK MND and USFK shall agree upon a definition for the term "Korean contractor," and amend the LCS Implementing Agreement accordingly. The standing consultative mechanism shall share information on projects under the LCS program in planning or execution phase, and conduct joint review on the contract award and payment process. The standing consultative mechanism shall put in efforts to resolve hardships faced by Korean contractors and to improve procedures streamlining the administrative process. Implementation details of the standing consultative mechanism shall be in accordance with a separate implementing agreement between ROK MND and USFK.
3. The Joint Cost Sharing Committee, co-chaired by the Director General, International Policy Bureau, ROK MND, and the Assistant Chief of Staff, J-5, USFK, shall meet at the request of either party.
4. The successor command to USFK is provisionally named U.S. Korea Command (KORCOM). Upon activation of KORCOM, all references herein to USFK shall expressly apply to KORCOM.
5. To enhance information sharing, the format of materials USFK provides to ROK MND shall be determined through mutual agreement by the Joint Cost Sharing Committee.
6. This Implementation Arrangement shall enter into force following signature by both Parties and upon exchange of written notification by the Republic of Korea and the United States of America that the SMA has been approved in accordance with their respective domestic legal procedures and shall remain in force for the duration of the SMA.
DONE at Seoul, Korea, this 18th day of June, 2014, in duplicate originals in the English and Korean languages, both texts being equally authentic.
FOR United States Forces Korea FOR Ministry of National Defense
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2 14 4A1
No. 040
The Embassy of the United States of America presents its compliments to the Ministry
of Foreign Affairs of the Republic of Korea and has the honor to refer to recent
discussions between representatives of our two governments regarding the Agreement
between the Republic of Korea and the United States of America Concerning Special
Measures Relating to Article V of the Agreement under Article IV of the Mutual
Defense Treaty between the Republic of Korea and the United States of America
regarding Facilities and. Areas and the Status of United States Armed Forces in the
Republic of Korea signed on February 2, 2014 (hereinafter referred to as "the SMA"),
and proposes that the in,lcind construction contributions shall be implemented in
accordance with the following principles:
(1) The Republic of Korea Funded Construction remains under the SMA.
(2) The United States of America, after consultation with the Republic of Korea,
selects and prioritizes construction projects based on military needs.
(3) The Republic of Korea awards construction contracts, and implements construction
projects in accordance with the corresponding timeline as identified and developed
during project design.
DIPLOMATIC NOTE
2014-0093
(5) The United States provides design specifications and a list of acceptable
contractors to the Republic of Korea Contractors shall be Republic of Korea
companies selected from the United States Army Corps of Engineers Far East
District's Pre-Qualified contractor list
(6). Design and Construction oversight, which averages twelve (12) percent of the total
project costs, is paid by the Republic of Korea in cash.
(7) Any bid savings shall be used for future projects.
(8) The United States and the Republic of Korea shall establish proper procedures to
prevent unexecuted contributions. In the unlikely event that unexecuted contributions
exist at the end of the year, those contributions shall roll over to the next year.
(9) An annual review, system shall be established to ensure in-kind procedures are
working. For the project or projects where it is determined in-kind procedures are not
worldng, the Republic of Korea and the United States shall consult in an effort to
resolve the problem, and take proper actions to complete the project or projects
including providing cash to the United States. In this regard, the Republic of Korea
Ministry -of National Defense and U.S. Forces Korea may enter: into implementation
arrangements.
If the foregoing, is acceptable to the Republic of Korea, the Embassy has the honor to
propose that this note, together with the Ministry's reply, shall constitute an agreement
The Embassy of the United States of A
Seoul, February • 26, 2014.
between the two governments, which shall enter into force at the same time as 'the
SMA.
The Embassy of the United States of . America avails itself of this opportunity to renew
to the Ministry of Foreign Affairs of the Republic of Korea the assurances of its
highest consideration.
No.041
The Embassy of the United States of America presents its compliments to the
Ministry of Foreign Affairs of the Republic of Korea and has the honor to refer to the
latter's Note No. OZT-556 of February 26, 2014, the content of which, states as
follows:
"The Ministry of Foreign Affairs of the Republic of Korea presents its compliments
to the Embassy of the United States of America and has the honor to refer to recent
discussions between representatives of our two governments regarding the Agreement
between the Republic of K -orea and the United States of America. Concerning Special
Measures Relating to Article V of the Agreement under Article IV of the Mutual
Defense Treaty between the Republic of Korea and the United States of America
regarding Facilities and Areas and the Status of United States Armed. Forces in the
Republic of Korea signed on February 2, 2014 (hereinafter referred to as "the SMA"),
and, in order to enhance accountability and transparency for implementation of the
SiviA, proposes the following vstem improvements:
1. Reinforce Coordination on the Allocations for Cost-Sharing Categories and
the Review of Requirements
1-1. The Republic of Korea Ministry of National Defense (R.OK MND) and U.S.
Forces Korea (USFK) shall comprehensively review and assess the USFK allocation
requirements for the three cost-sharing categories (i.e., Labor Cost Sharing, Logistics
DIPLOMATIC NOTE
Cost Sharing (LCS), and Republic of Korea Funded Construction (ROKFC)), based
on relevant documents and materials, through the Joint Cost-Sharing Committee.
When necessary, the discussion may be elevated to the Minister of National Defense
and the USFK Commander for further deliberation.
1-2. USFK. shall complete estimation of the amount of allocations for the three•
categories by March 15 of the year before the year of execution. USFK. shall take into
full corisideration the aforementioned joint review and assessment when submitting its
final amount of allocations to ROK. MND by August 31 of the year before the year of
execution.
2. Establish. an Effective Consultation Mechanism for ROKFC
2-1. ROK MND and USFK shall establish through consultation each year's ROKFC
program.
- ROKFC projects shall be initially selected and prioritized by I./SFK.
- ROK /AND- and USFK shall review and discuss ROKFC,projects through the Joint
Coordinating Group (jCG). ROK MND and USFK each shall appoint an
appropriate senior level official to co-chair the JCG. Details concerning the
operations of the JCG shall be included in the Implementing Agreement for
ROKFC In-Khzd Projects.
- USFK. shall submit a draft construction projects list, initial project design list, and
brief project descriptions to ROK MND by November 30 two years prior to the
year of execution through a session of the JCG.
- ROK MND and USFK should hold a ROKFC coordination meeting twice every
month.
- USFK shall submit its final draft construction projects list to ROK MND by
August 31 of the year before the year of execution.
- Concerns may be elevated to the Joint Cost-Sharing Committee no later than
October 1 of the year before the year of execution. If unresolved, those concerns
may be elevated to the Minister of National Defense and the USFK Commander
for resolution no later than November I of the year before the year Of exeoution.
- Based on, and incorporating the aforementioned consultation and coordination,
USFK shall submit its final construction projects list to ROK MND by
November 30 of the year before the year of execution.
- When and if a situation Occurs that was not envisioned at the tune of establishing
the final construction projects list, USFK may substitute an emergent
requirement into the final eOnstruction projects list to the niinimura extent
necessary based solely on military needs through andy until August 31 of the
year of 'execution.
2-2. ROK MND and USER. shall review comprehensively the previous, present, and
.future years' ROKFC program through a session of the JCG at least once a year In
preparation for this meeting, U$FK. shall provide ROK. MND with a forecast for
future ROKFC projects.
3. Improve the Working Methods and Procedures for the Logistics Cost Sharing
(LCS) Program
3-1. ROK MND and. USFK shall agree upon a definition for the term "Korean
contractor," taking into full consideration the concerns of the ROK Government
regarding Korean entities, as well as relevant laws and regulations, and amend the
LCS Implementing Agreement accordingly.
3-2. ROK MND and USFK shall establish a standing consultative mechanism to
reinforce mutual efforts to improve methods and procedures to streamline
administtative processes for all Korean contractors, including small and medium sized
enterprises; improvemethods of tracking and monitoring contract award and payment;
improve program information sharing; and improve measures to promptly resolve
difficulties faced by Korean contractors under the LCS program.
4.Enhance Transparency Reg:1041g Labor :Cost: Skating
4-1. USFK shall continue to endeavor to enhance the welfare and well-being of its
Korean National workforce. In this regard, the review and assessment ,of. SMA
allocation by the joint Cost-Sharing Committee shall start with Labor Cost Sharing.
4-2. USFK shall provide ROK MND, with detailed information concerning
implementation of the Labor Cost Sharing program, in addition to the SMA
Comprehensive Annual Execution Report presented at the Korea-U.S. Integrated
Defense Dialogue (KIDD).
5. Enhance Information Sharing
5-1. ROK MND may share the result of the Joint Cost-Sharing Committee's
discussion about allocations for the three categories with the Republic of Korea
National Assembly.
5-2. ROK MND and USFK shall prepare the. SMA Comprehensive Annual Execution
Report on the contritmtions across the three categories each is respectively responsible
for executing during the previous year, and submit it to the KIDD co-chairs by April
of the year after the year of execution.
5-3. USFK shall provide ROK MND with_' detailed status report of tmexecuted
ROKFC cash contributions twice each calendar year.
5-4. ROK MND may share the information from the aforementioned reports and other
periodic execution reports with the Republic of Korea National Assembly in a manner
that would not compromise ,militaty . scurity.
If the foregoing proposal is acceptable to the United States- of America, -the Ministry
has the honor to propose that this note, together with the Embassy's note in reply,
shall constitute an agreement between the two governments, which shall enter into
force on the same date as the SMA.
The Ministry of Foreign Affairs of the Republic of Korea avails itself of the
opportunity to renew to the Embassy of the United States of America the assurances
of its highest consideration.
Seoul, February 26, 2014"
The 'Embassy of the United States of America has the honor to confirm and inform
the Ministry of Foreign Affaiis Of the Republic of Korea that the proposals as set forth
in the Ministry's note No OZT-556 of February 26, 2014, as herein quoted, are
acceptable to the Governirtent of the United States of America and that theMinistry's
said note and this note shall constitute an agreement between the Government of the
-United States of AmeriCa and the Government of the Republie of Korea which shall
enter into fOree on this date,
The Embassy of the United States of America takes this opportunity to renew to tile
Ministry of Foreign Affairs of the Republic of Korea the assurances of its highest
consideration.
Se.otili February 26, 2014
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51662 - Rep of Korea Defense Sys Imp w Corr Notes.pdf
51662 - Rep of Korea Defense Sys Imp w Corr Notes.pdf
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