In a cautious response to North Korea's surprise offer to restart cross-border tours, South Korea is trying to decide whether income from the trips would breach UN sanctions, an official said Tuesday.

The communist state, sanctioned for its missile launches and nuclear tests, announced Monday it reached agreement with a visiting Seoul business leader to restart tours which have earned it tens of millions of dollars over the years.

Disclosing the deal with Hyundai Asan, which operates inter-Korean business ventures, the North said tours to the scenic Mount Kumgang east coast resort and to historic Kaesong city near the west coast would resume as soon as possible.

The offer was seen as Pyongyang's first conciliatory gesture to Seoul after months of hostility.

The North also agreed to resume reunions for families separated since the 1950-1953 war, and to ease border restrictions which hampered operations at the Seoul-funded Kaesong industrial estate.

Seoul cautiously welcomed the announcement, but said the two governments must first hold talks to agree ways to implement it.

"We are looking into the agreement to check what relevance it has to UN Security Council Resolution 1874," a foreign ministry official handling the issue told AFP on condition of anonymity.

The resolution aims to choke off sources of cash which could fund the North's nuclear and missile programmes.

It bans "new commitments for grants, financial assistance, or concessional loans to (North Korea), except for humanitarian and developmental purposes directly addressing the needs of the civilian population."

The official declined comment on a Yonhap news agency report that Seoul would discuss the issue with a US delegation tasked with enforcing the sanctions.

The team led by Philip Goldberg arrives Sunday for a two-day visit and will also visit Singapore, Thailand and Japan.

Seoul suspended the Kumgang tours after North Korean soldiers in July 2008 shot dead a South Korean housewife who strayed into a military zone.

As ties worsened further, the North last December halted a separate day trip to Kaesong and limited access to the industrial estate there.

The North has received about 410 million dollars since tours to Kumgang began in late 1998, excluding initial investments and payments.

Christopher Hill, chief US nuclear negotiator under the Bush administration, had openly expressed concern at the inflow of hard currency.

Seoul has offered the North massive economic aid but only in return for full denuclearisation.

The United States on Monday welcomed the North's apparent conciliatory gesture but said it must move ahead with denuclearisation.

"One might infer that North Korea is feeling some pressure, whether it's political pressure, economic pressure or a combination of the two," said State Department spokesman P.J. Crowley.

The South will this week propose to North Korea that Red Cross talks be held to prepare for the family reunions, Yonhap reported.

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