The Chairman of the Korea Chamber of Commerce and Industry Tried to Persuade... Ruling Party Says "Three Corporate Regulation Bills to Be Processed in the Regular National Assembly" (Comprehensive)

[Image source=Yonhap News]

[Asia Economy Reporter Kiho Sung] The business community has launched a final persuasion effort to block regulatory bills, including the three corporate regulation laws, being promoted by the government and the ruling party. However, they have failed to find common ground and appear to be running on parallel tracks.

On the 14th, Sohn Kyung-shik, Chairman of the Korea Employers Federation (KEF), attended the KEF-Democratic Party Fair Economy Task Force policy meeting held at the KEF headquarters in Mapo-gu, Seoul, and expressed concerns about the related bills, saying, "The foundation of the core corporate management system could be shaken."

Chairman Sohn emphasized, "Our companies have devoted their utmost efforts to economic development, creating jobs and raising wages and labor welfare levels. While there have been occasional criticisms regarding transparency and ethics in the course of managing companies, government regulations on corporate governance and fair trade have continuously strengthened, and companies have evolved in line with the global paradigm, now reaching a level recognized internationally."

He also explained to Democratic Party lawmakers that the seven most concerning issues for companies are ▲strengthening regulations on the appointment of audit committee members ▲introduction of the multiple derivative lawsuit system ▲relaxation of the six-month holding requirement for exercising minority shareholder rights in listed companies ▲abolition of exclusive prosecution rights ▲expansion of internal transaction regulations ▲raising the mandatory shareholding ratio of subsidiaries by holding companies ▲and enactment of the Financial Group Supervision Act. He added, "In addition, many companies have expressed concerns about strengthening disclosure of overseas affiliates and introducing regulations on information exchange activities."

In particular, regarding the separate appointment of audit committee members and strengthening of the 3% rule, he said, "Our companies are most worried," emphasizing, "Small and medium-sized enterprises and mid-sized companies, which have weak litigation capabilities and capital strength, are appealing that they could be shaken in their management due to attacks by large external forces and excessive lawsuits by minority shareholders."

Chairman Sohn explained, "Of course, if companies violate laws or commit unfair practices, they should receive corresponding penalties. However, if regulations that preemptively and fundamentally restrict management or business are imposed, it will be difficult for our companies to operate properly."

In response, Yoo Dong-soo, Senior Deputy Chairman of the Democratic Party Policy Committee, said, "These bills have been reviewed and considered for a considerable time since the 20th National Assembly," adding, "We consider them bills that must be processed in this regular session."

He continued, "Rather than saying 'no' or 'it's difficult' unconditionally, if reasonable alternatives are presented, we will listen carefully and consider them rationally."

After the closed-door meeting, Chairman Sohn told reporters, "We are fully conveying the opinions of the business community," and "We expect it to be effective." However, when asked whether Democratic Party lawmakers agreed with the business community's proposals, he only replied, "(Today's meeting) was a gathering for Democratic Party lawmakers to listen to opinions."

Meanwhile, earlier that morning, Park Yong-man, Chairman of the Korea Chamber of Commerce and Industry (KCCI), met with Democratic Party lawmakers to request amendments and supplements to the three corporate regulation laws.

In his opening remarks at the Fair Economy Task Force policy meeting held at the KCCI in Jung-gu, Seoul, Chairman Park said, "I am glad that the Democratic Party accepted the business community's proposals and started operating the Fair Economy TF," but added, "Regarding amendments to the Commercial Act and the Fair Trade Act, regulation alone is not always the answer."

However, it is reported that during the closed-door meeting following the opening remarks, the KCCI and the Democratic Party showed a tense clash of opinions over key issues of the amendments to the Commercial Act and the Fair Trade Act, such as the 3% rule, separate election of audit committee members, and abolition of exclusive prosecution rights.

This content was produced with the assistance of AI translation services.