Han Ki-jung, Fair Trade Commission Chairman, "Unfair Internal Transactions in Mid-sized Companies Must Be Strictly Monitored"

1st Anniversary Press Conference on the 14th
"Lack of Checks on Mid-sized Companies, Active Monitoring Needed"

Kang Ki-jung, Chairman of the Korea Fair Trade Commission, is delivering opening remarks at a press conference marking his first anniversary in office on the 14th at the government complex in Sejong City. Photo by Korea Fair Trade Commission

Han Ki-jung, Chairman of the Fair Trade Commission, declared that even if unfair internal transactions are detected in mid-sized companies, the law will be strictly enforced. He also argued that stronger monitoring is necessary since mid-sized companies have fewer checks and balances compared to large corporations. However, he mentioned that necessary corporate regulations will be eased considering changes in the economic and social environment.

On the 14th, Chairman Han held a press conference marking his first anniversary in office at the Sejong Government Complex press room, stating, “The Fair Trade Commission plans to strictly enforce the law not only against large business groups but also against mid-sized groups with high market dominance involved in unfair internal transactions,” and emphasized, “We will closely monitor the status of internal transactions within mid-sized groups and promptly investigate and correct any suspected legal violations.”

Chairman Han continued, “Mid-sized groups hold significant influence in industries closely related to the daily lives of the public, such as pharmaceuticals, apparel, and food and beverages,” adding, “Compared to large business groups, mid-sized groups lack sufficient internal and external checks and balances, such as a higher proportion of the controlling family on the board of directors, necessitating more proactive monitoring.” In fact, 15.8% of mid-sized companies have controlling family members occupying more than half of the board, which is more than four times the 3.4% seen in large corporations.

He also expressed intentions to rationally improve corporate group policies. Chairman Han explained, “Considering the contraction in corporate venture capital (CVC) activities, we aim to ease behavioral restrictions to revitalize investment through holding company CVCs,” and added, “We are reviewing plans to raise the external capital ratio limit to encourage joint investments with external investors or other CVCs, and to relax overseas investment ratio restrictions in light of difficulties investing in promising foreign companies.”

Furthermore, he stated, “We plan to rationally revise the criteria related to the designation system for large business groups,” and said, “To increase predictability in the designation of the same person, we will complete the establishment of judgment criteria and confirmation procedure guidelines by the end of the year, and also prepare designation criteria related to foreign controlling persons that minimize trade friction risks and regulatory gaps.”

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