[Column] The Reason for Maintaining the Awkward Exclusive Prosecution System

(Photo) [Image source=Yonhap News]

[Asia Economy Reporter Joo Sang-don] "Reflecting the concerns of the business community, it was decided to maintain the Fair Trade Commission's exclusive right to prosecute."

This is the ruling party's explanation for the omission of the Fair Trade Commission's exclusive right to prosecute abolition proposal from the comprehensive amendment to the Fair Trade Act, which passed the National Assembly on the 9th. It is not incorrect. The business community has opposed the abolition of the exclusive prosecution system, arguing that "simultaneous investigations by the Fair Trade Commission and the prosecution, as well as separate investigations by the prosecution, will cause great confusion in the law enforcement system and increase the burden on companies."

However, considering that the Democratic Party of Korea passed the three corporate regulation laws and the three laws for ratifying the core conventions of the International Labour Organization (ILO) with a majority in this regular session of the National Assembly, very few believe this explanation at face value. Moreover, the ruling party even added restrictive provisions to the corporate venture capital (CVC) allowance, which was initially presented to appease the business community. These include a clause prohibiting CVCs from selling shares directly invested in venture companies or funds to affiliates outside the controlling family or holding company during the 'exit' phase of recovering CVC investment funds, and a penal provision imposing imprisonment of three years or more or a fine of up to 200 million won for violating CVC-related prohibitions. This means that large corporations face significant constraints in actually establishing CVCs.

The exclusive prosecution system is a system that grants the right to prosecute violations of the Fair Trade Act solely to the Fair Trade Commission. It was introduced to prevent abuse of prosecution against companies and to avoid contraction of corporate activities. However, President Moon Jae-in pledged to abolish the exclusive prosecution system, citing inadequacies in protecting the rights of the general public and consumers due to the Fair Trade Commission's monopoly on prosecution rights. Kim Sang-jo, Chief of the Presidential Policy Office, is also one of the advocates for abolishing the exclusive right to prosecute. Despite strong opposition from the business community, the government, ruling party, and Blue House did not waver in their intention to abolish the exclusive prosecution right.

It is reasonable to see the ruling party's reversal to maintain the exclusive prosecution right during the National Assembly's bill processing not as a consideration of the corporate burden but as a political judgment. The abolition of the exclusive prosecution right, which was promoted to empower the prosecution during the Park Geun-hye administration's deep-rooted corruption investigations, has recently degenerated into a means to weaken Prosecutor General Yoon Seok-youl amid the 'Yoon Seok-youl-Prosecutor General and Choo Mi-ae-Minister of Justice conflict' incident. As economic logic and political logic became mixed without distinction, the spark for abolishing the exclusive prosecution system remains alive. Political decisions can be overturned at any time.

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