South Korea had requested the exemption for the member of the North's delegation to Pyeongchang on Wednesday.
The extravaganza celebrated the 70th anniversary of the founding of North Korea.
North Korea has staged a huge military parade less than 24 hours ahead of the opening of the Pyeongchang Winter Olympics.
Some analysts question if Pyeongchang is serious about peace overtures or just using the Games to improve its image.
It will be cold and colorful, dramatic and dangerous, exciting and emotional — the 2018 Winter Olympics is set to burst into life in South Korea.
The UN also decided delegation members would be allowed to buy luxury goods while in South Korea.
Low profile annual affair in Pyongyang as North gets ready to march under one flag with South Korea at Winter Olympics.
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