SanJawi, Push to Expand KEPCO Bond Issuance Limit Up to 6 Times... Positive Signal for Temporary National Assembly Approval Within the Year

Rejected once in the plenary session causing 'controversy'... Democratic Party opposes due to Yang Yi-won-young's opposing debate
Consensus reached between ruling and opposition parties to expand KEPCO bond issuance limit... Both parties have proposed related bills
Expected to be processed within the temporary session... Declarative provisions likely to be included

[Image source=Yonhap News]

[Asia Economy Reporter Oh Ju-yeon] The amendment to the "Korea Electric Power Corporation Act" that increases the issuance limit of Korea Electric Power Corporation bonds (KEPCO bonds) up to six times is expected to be processed on the 15th at the relevant standing committee subcommittee. Although the amendment to expand the issuance limit of KEPCO bonds was rejected due to opposition from the Democratic Party of Korea at the plenary session of the regular National Assembly, a crisis was averted as the ruling and opposition parties reconsidered and reached an agreement, signaling a green light for processing within the extraordinary session.

On the day, the National Assembly's Industry, Trade, Energy, Small and Medium Enterprises Committee held a plenary meeting in the morning and submitted the amendment to the KEPCO Act. The ruling and opposition party secretaries will hold a subcommittee on industry, trade, and energy patents to review and process the amendment. If it passes the subcommittee on this day, it is expected to be smoothly processed within the December extraordinary session. A committee official said, "Unless there are special circumstances, we expect it to be approved."

This amendment was once rejected at the plenary session of the regular National Assembly on the 8th. At that time, the amendment to the KEPCO Act, which increased the issuance limit of KEPCO bonds from twice to five times the sum of capital and reserves to cover deficits, was submitted but rejected with 89 votes in favor, 61 against, and 53 abstentions out of 203 members present. This was after Democratic Party lawmaker Yang Yi-won-young of the Industry Committee spoke in opposition, and concerns about the scale of KEPCO bond issuance were raised mainly by opposition lawmakers.

Although controversy arose as the bill, which had been agreed upon by both parties through the standing committee and the judiciary committee, was blocked at the final stage, the ruling and opposition parties reconsidered the bill in light of KEPCO's severe management difficulties and agreed to resubmit it on this day.

At the subcommittee on this day, the amendments submitted by Kim Sung-won of the People Power Party, Gu Ja-geun of the Democratic Party, and the amendment submitted the previous day by Kim Hoe-jae of the Democratic Party will be merged and reviewed. Kim Sung-won's amendment aims to expand the KEPCO bond issuance limit from the current twice the sum of capital and reserves to four times, and in urgent cases to resolve management crises, allow issuance within a limit of up to six times. Gu Ja-geun's amendment proposes expanding the issuance limit to seven times, which is a larger scale than Kim's proposal.

The previous day, the Democratic Party also submitted an amendment to expand the KEPCO bond issuance limit to five times. Lawmaker Kim Hoe-jae proposed temporarily expanding the KEPCO bond issuance limit to five times until 2025, and in urgent cases to resolve management crises, allowing issuance within a limit of up to six times with approval from the Ministry of Trade, Industry and Energy.

The KEPCO bond issuance limit is not expected to deviate significantly from the proposal that was rejected at the last regular National Assembly. However, due to the burden of reviewing and processing the same amendment that was rejected at the plenary session again at the standing committee, it is explained that declarative provisions will be added.

A committee official said, "The government and KEPCO will include provisions such as efforts to normalize electricity rates and improve financial structure," adding, "Regarding the sunset clause, the opposition party's proposal of 'within three years' is considered difficult to meet given the bond issuance period, so discussions will focus on the agreement between the ruling and opposition party secretaries to set it at five years."

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