Abolition of Mandatory Financial Institution Investment in Corporate Credit Rating Providers... Amendment to the New Financial Investment Services Act Proposed for Legislation

The obligation for financial companies to invest in corporate credit rating providers will be abolished. This is expected to activate new entries by businesses holding corporate data.

The Financial Services Commission announced on the 3rd that it will conduct a legislative notice for the amendment to the "Act on the Use and Protection of Credit Information," which includes this content.

First, the amendment includes the abolition of the obligation for financial companies to invest in corporate credit rating providers. Under the current law, the minimum capital for corporate credit rating providers is set at 2 billion KRW, and the obligation for financial companies to invest is stipulated as a shareholding ratio of 50% or more.

However, since corporate credit information is not personal information and thus does not raise personal information protection issues, and there is a need to activate new business entries by operators holding various corporate data, the obligation for financial companies to invest has been decided to be abolished.

Additionally, the amendment includes the inclusion of corporate credit evaluation models in the verification targets of the Credit Evaluation System Verification Committee to periodically verify their appropriateness and improve the quality of evaluation models. Unlike the personal and individual business credit evaluation models, which are already undergoing verification, corporate credit evaluation models have not had separate external verification mechanisms until now.

The scope of incidental business for individual business credit evaluation companies will also be expanded. A basis for delegation will be established in the enforcement decree to regulate the scope of incidental business so that individual business credit evaluation companies can perform tasks such as advertising and promotion of financial products for individual businesses, business surveys, business site valuation, and identity verification.

Furthermore, the amendment clarifies the legal basis for the preliminary licensing system operated based on supervisory regulations (notices) and includes content to make the refund surcharge rate applied when refunding fines linked to market interest rates more realistic.

Meanwhile, this amendment will undergo a legislative notice from the 4th to October 14th, and after procedures such as review by the Ministry of Government Legislation, it is scheduled to be submitted to the National Assembly within the year.

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