South Korea’s top online portal operator Naver Corp. argued against falling under the label of a chaebol (conglomerate) entity that invites tougher scrutiny in tax and other business regulations by state offices.

In a rare move, Naver on Wednesday disclosed a meeting with founder and former Naver chairman Lee Hae-jin’s visit to the office of the Fair Trade Commission where he contested against the regulator’s conglomerate guidelines.

Naver is expected to join the watch list on conglomerate majors, falling under tougher set of regulations and watch, next month.

Currently, all business groups with 5 trillion won or more in assets are included in the conglomerate watch list and are regulated to prevent the owner families from abusing their power and commanding control over the business beyond their stake. Because most conglomerates are run by founding families - except for privatized entities like Posco and KT - the FTC places legal and other accountability in the representative individuals. That individual would be Lee in Naver’s case as he had founded the company.

“Naver in its unique transparent ownership structure and professional management system does not fit under the traditional chaebol category,” the company said. Lee owns less than 5 percent in Naver and none of his family and relative members have interest in the company. Subsidiaries are entirely owned by the parent group and have no attachment to certain individuals.

If Naver comes under the large corporate category, its legal representative should be the incorporated company and not Lee.

“Naver is run by multiple chief executives instead of one individual Lee,” it argued.

By Shin Hyun-kyu and Seok Min-soo

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]