StageX Faces Fourth Telecom License Revocation Step..."Failure to Meet Requirements"

Ministry of Science and ICT "Planned Cancellation of Corporation Selection"
Undercapitalization and Non-fulfillment of Shareholder Pledge

The government announced that it plans to revoke StageX's qualification as the fourth mobile carrier. This is because they failed to properly fulfill the necessary requirements to be allocated the 28 GHz frequency band, including capital payment.

Seo Sang-won, CEO of StageX, attended the 'StageX Media Day' held on the 7th at Fairmont Ambassador Seoul in Yeouido, Seoul, introducing the 28GHz communication business strategy. Photo by Kang Jin-hyung aymsdream@

On the 14th, the Ministry of Science and ICT announced that it intends to cancel the corporate selection of StageX, the entity designated for the allocation of the 28 GHz band mobile communication frequency. This decision was made after reviewing the required documents submitted by StageX on the 7th of last month and determining that they did not comply with the legal requirements. The Ministry will make a final decision on whether to cancel the selection after a hearing process in accordance with the Administrative Procedures Act.

Previously, StageX was selected as the frequency allocation target corporation by offering the highest bid (430.1 billion KRW) in the 28 GHz band frequency auction held in February. Subsequently, StageX submitted documents to the Ministry of Science and ICT to prove fulfillment of the requirements, including the receipt of frequency allocation payment, the certificate of corporate registration, proof of stock payment deposit, and a letter of commitment to fulfill allocation conditions.

Upon reviewing the proof of stock payment deposit, the Ministry confirmed that StageX had paid an amount significantly less than the capital of 205 billion KRW stated in the frequency allocation application. When asked for an explanation, StageX responded that they would make the payment by the third quarter of this year. However, according to multiple legal advisories, the capital of 205 billion KRW should have been fully paid by the submission date of the required documents on the 7th of last month.

Regarding the pledges of the constituent shareholders, discrepancies were found compared to the contents of the frequency allocation application. According to additional materials from StageX, among the six major shareholders holding 5% or more at the time of application, only one shareholder, StageFive, had partially fulfilled the capital payment. The other five major shareholders had not made any capital payments as of the 7th of last month, and two out of four other shareholders were in the same situation.

The Ministry of Science and ICT stated, "Without approval, changes to the constituent shareholders and stock ownership ratios are prohibited, and violating the pledge to implement the funding plan described in the allocation application documents constitutes grounds for cancellation of the selected corporation."

To urge fulfillment of the requirements and pledges, the Ministry requested proof of capital payment from each constituent shareholder three times in total, but StageX responded that they plan to complete the necessary procedures for investment after securing the status of a new mobile carrier. The Ministry confirmed that the capital payment plans from the major constituent shareholders have not been finalized.

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