Prosecutors Summarily Indict Third-Generation Owner of Jeil Pharm for Violating Holding Company Regulations

Seoul Central District Prosecutors' Office, Seocho-gu, Seoul. Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Kim Daehyun] Han Sangcheol, CEO of Cheil Pharma Holdings, who is accused of failing to dispose of shares of a domestic affiliate company in a timely manner rather than a subsidiary, has been summarily indicted. CEO Han, the third generation of the Cheil Pharmaceutical owner family, is the grandson of the late founder Han Wonseok and the eldest son of Han Seungsu, chairman of Cheil Pharma Holdings.

On the afternoon of the 8th, the Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Ko Jinwon) announced that Cheil Pharma Holdings and CEO Han were summarily indicted for violating the Fair Trade Act. A summary indictment is a procedure in which the prosecution requests a fine or penalty through written review instead of a formal trial.

Cheil Pharma Holdings, which converted to a holding company for Cheil Pharmaceutical in November 2018, is accused of violating the regulation that requires disposal of shares of domestic affiliates other than subsidiaries within two years by holding 6,000 shares of Hanjong Enterprise until last March.

Under the current Fair Trade Act, holding companies are not allowed to own shares of domestic affiliates other than subsidiaries, but if they owned such shares at the time of conversion to a holding company, a two-year grace period is granted.

Previously, the Fair Trade Commission ordered Cheil Pharma Holdings to dispose of the shares and reported CEO Han and the company to the prosecution for violating the Fair Trade Act. It is reported that CEO Han disposed of all the shares after the report.

A prosecution official said, "This is the first case of indictment for violating the restrictions on holding companies under the Fair Trade Act," and added, "We will actively respond to fair trade offenders who threaten a fair market economy order in the future."

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