All stocks and bonds in South Korea would now be issued and registered electronically as the country’s stock exchange officially goes paperless.

The country’s electronic securities system came into effect Monday, three and a half years after related laws were enacted.

Under the new system, securities certificates of listed stocks and bonds would all be recorded on an electronic register and no longer exist in paper form. Investors can acquire and transfer their securities rights electronically. Unlisted stocks can be registered upon application by the issuer.

Electronic registration agencies would need to seek licenses from both the chief of the Financial Services Commission and the justice minister. The agencies, along with financial companies, would be in charge of overseeing the new system. The registration agency license was first handed out to Korea Securities Depository to ensure a smooth rollout.

The new paperless system is expected to reduce risks of counterfeit and theft, save issuance costs and time, and improve transparency in corporate governance and securities transactions.

Eun Sung-soo, chairman of the Financial Services Commission, Lee Byung-rae, chief executive of Korea Securities Depository, and Cho Kuk, the newly appointed justice minister, attended a ceremony Monday to mark the launch of the new system.

By Jin Young-tae and Kim Hyo-jin

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