South Korea has scrapped plans for barter transactions with a North Korean trading company, after the firm was found to be the subject of international sanctions.

The decision was confirmed by Vice Unification Minister Suh Ho, who briefed the parliamentary intelligence committee at a closed-door meeting on Monday.

Main opposition United Future Party(UFP) Rep. Ha Tae-keung said the ministry is believed to have failed to conduct thorough checks into the firm through the National Intelligence Service(NIS).

Seoul has been considering approving the 150 million-won project between a local farmers' group and Kaesong Koryo Insam Trading Company, to bring in North Korean ginseng, blueberry liquors and other products in exchange for sugar.

The North Korean company, however, is on the international sanctions list for its suspected handling of the North's foreign currency earnings under Bureau 39 of the ruling Workers' Party.

Ruling Democratic Party(DP) Rep. Kim Byung-kee said the ministry's barter transaction initiative as a whole, however, has not been withdrawn.