Korea`s antitrust move to identify foreign national as corporate chief faces US complaint

2022.07.29 12:07:42 | 2022.07.29 14:29:50

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The U.S. has formally complained against the South Korean antitrust agency’s plan to identify foreign nationals as business conglomerate representatives to make them subject to the same legal liability as Korean business chiefs.

Korea’s Fair Trade Commission (FTC) is due to make a preliminary announcement on the changes in the provision of the Monopoly Regulation and Fair Trade Act as early as next week.

The keystone is to identify a foreign national as the representative of a sizeable business operation with assets of 5 trillion won ($3.9 billion) or greater in Korea.

Every year, the Korean fair trade watchdog lists business conglomerates with a representative in charge of business and subject to regulatory liabilities for the operation in Korea.

The chief is also required to disclose any internal transactions, changes in equity shares of listed companies, and changes in ownership status and holdings through companies and individuals of special relations.

Failure to make such disclosures can have the chief face criminal action and up to a two-year prison term when found guilty.

Newly falling into the category would be e-commerce giant Coupang, which is headquartered and public traded on a U.S. stock exchange but earns income primarily from businesses in Korea.

The company is headed by Kim Bom-suk, a Korean American with U.S citizenship. Because Kim is not a Korean national, FTC has been unable to identify Kim as the chief of Coupang and find him liable for any violation of local rules.

General Motors Korea and S-Oil also could fall in the category.

In theory, FTC can identify Mary Barra, CEO of U.S. auto giant General Motors as the head of the Korean unit and Mohammad Bin Salman, the Crown Prince of the Kingdom of Saudi Arabia, as the legal representative of S-Oil, which Saudi Aramco owns more than 80 percent.

But FTC may leave out GM Korea and S-Oil due to complexities.

The U.S. government has lodged a complaint over the Korean antitrust authority`s move, finding it duplicative regulation.

Coupang Inc., controlling its operating subsidiary, Coupang Corp., in Korea, is listed on the New York Stock Exchange that it must comply with regulations of the U.S. Securities and Exchange Commission.

By Oh Soo-hyun, Baek Sang-kyung and Cho Jeehyun

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