National Pension Service: Social Security Agreement for Hungarian and French Nationals

Foreigners 18-60 years old who are residing and working in Korea, regardless of their nationality, should be covered under the National Pension Service (NPS). Foreigners whose countries do not cover Korean nationals, however, are excluded from the coverage of NPS. Even so, if there are relevant provisions under the Social Security Agreement (SSA) between Korea and a foreigner’s country, those provisions will be applied.

To protect the rights of foreigners, the SSA is publishing a series of articles highlighting SSAs in cooperation with Gwangju News. This month’s featured SSA is for foreigners from Hungary and France.

Hungary: SSA between Korea and Hungary entered into force: March 2007.

France: SSA between Korea and Hungary entered into force: June 2007.

Exemption from Dual Coverage

In general, an employee is subject to the legislation of a Contracting Country in which he/she is employed.

A self-employed person is subject to the legislation of a Contracting Country in which the person ordinarily resides.

If a person is employed in the territory of one Contracting Country and is self-employed in the territory of the other Contracting Country for the same period, he/she is subject to the legislation of the Contracting Country in which he/she originally resides.

A detached worker is exempt from coverage under the legislation of the Contracting Country which he/she is sent to for less than 3 years if he/she is covered under the legislation of his/her home country. This 3-year limit can be extended to 6 years with the proper consent between agencies of both countries.

Benefits under this Agreement

Even though your periods of coverage in one country are not sufficient to qualify for pension benefits, you may be eligible for benefits after this agreement has entered into force. This is possible due to totalization of coverage in both countries.

Korean National Pension Benefits under the SSA

If you have more than 12 months of insured period in Korea but do not have enough periods of coverage (e.g., 20 years for Full Old-age Pension) to qualify for pension benefits under the Korean pension system, you may be able to qualify for Korean benefits by totalizing periods of coverage under the Korean pension system and (Hungarian/French) pension system. However, those periods creditable under (Hungarian/French) pension systems must not coincide with the periods under the legislation of Korea.

Your benefit is calculated by dividing the Korean periods of coverage by the total periods of coverage and then multiplying by the Theoretical Benefit. The Theoretical Benefit is calculated based on the totalized periods in both countries.

(Hungarian/French) Pension Benefits under the SSA

If you have more than 12 months of insured period in (Hungary/France) but do not have enough periods of coverage (e.g., 20 years for Full Old-age Pension) to qualify for pension benefits under the (Hungarian/French) pension system, you may be able to qualify for (Hungarian/French) benefits by totalizing periods of coverage under the Korean pension system and the (Hungarian/French) pension system. However, those periods creditable under the Korean pension scheme must not coincide with the periods under the legislation of (Hungary/France).

Your benefit is calculated by dividing the (Hungarian/French) periods of coverage by the total periods of coverage and then multiplying by the Theoretical Benefit. The Theoretical Benefit is calculated based on the totalized periods in both countries.

If you do not have enough periods of coverage to qualify for French pension benefits under the French Pension Plan (CPP), you may be able to qualify for French pension benefits by totalizing periods of coverage under the Korean pension system and the French Pension Plan (CPP). However, those periods creditable under the Korean pension scheme, must not coincide with the periods of the French Pension Plan (CPP).

A person who is or has been subject to the laws of one Contracting Country and who resides within the territory of the other Contracting Country shall, together with his dependents, receive equal treatment as the nationals of the other Contracting Country in the application of the laws of the other Contracting Country regarding the eligibility for and the payment of benefits.

A Korean lump-sum refund is paid to (Hungarian/French) nationals. However, whether a lump-sum refund is paid to a national of a third country depends on the reciprocity principle stipulated in the Korean National Pension Act.

However, since there is no provision for a lump-sum refund in the legislation of the (Hungarian/French) Social Insurance Pension System, Korean people cannot be paid a lump-sum refund from the (Hungarian/French) Social Insurance Pension System. Instead, the contributions to the (Hungarian/French) Pension System may be calculated toward pension payments according to the legislation of the (Hungarian/French) Social Insurance Pension System.