Korea’s justice ministry proposes to make e-voting by shareholders valid from 2023

2022.07.27 15:09:12 | 2022.07.27 15:19:06

[Photo by MK DB]이미지 확대

[Photo by MK DB]

Shareholders of publicly trading South Korean companies may be able to exercise their voting rights via online from as early as next year as the Korean justice ministry seeks to revise the local commercial law accordingly.

According to a briefing by Justice Minister Han Dong-hoon to President Yoon Suk-yeol on Wednesday, the ministry is exploring revision in the commercial law to make e-voting by shareholders legally binding, along with other measures to make it easier for shareholders to participate in decision making within a company.

Under the current Korean commercial law, attending a shareholders’ meeting via online and electronic voting made on the day of meeting are not legally valid.

The justice ministry is currently organizing a team of commercial law specialists to discuss the possible legal adoption of virtual shareholders` meetings and an electric voting system with an aim to increase shareholders’ power.

The ministry targets to launch the committee for legal revision in August and announce the proposed change in commercial law early next year. It hopes to enable online shareholders meeting and voting from shareholders` meetings in 2023.

Once the related law is revised, companies will be able to notify shareholders of meetings via mobile text messages and e-mails, currently restricted to physical letters. Also, shareholders will be able to attend meetings online and electronically cast votes.

The changes will help increase shareholders’ participation in decision making within a company and also save companies’ expenses related to shareholder meetings, said a justice ministry official.

By Hong Hye-jin, Kim Dae-ki and Cho Jeehyun

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