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玉流館 is a famous North Korean restaurant with many overseas branches.

The name of the restaurant is written in hangul as 옥류관, and transliterated as “Okryu-gwan”. If that is so, why is it pronounced as “Ongnyugwan”? Is there any elision/sound change at play here?

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Yep, a totally regular consonant assimilation, specifically nasalisation: ㄱ + ㄹ makes ㅇ + ㄴ

This is also part of the reason why hangeul is considered a morphophonemic script, not simply phonemic.

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ㄹ after ㄱ is pronounced as ㄴ, and ㄱ before a ㄴ sound becomes ㅇ. This is known as nasalization. If nasalization was reflected in transliterations, it may lead to problems identifying the original word, and so it is transliterated as is, but pronounced with any sound changes in effect (as far as I'm aware).

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