Participating and Exchangable Bonds Issuance by Non-listed Companies in Korea

With the recent amendment of the Korean Commercial Code (KCC) and the issuance of the Presidential Decree for the KCC, Korea will now allow, when specific requirements are met, the issuance of bonds including redeemable and derivative bonds under article 469 of the Commercial Code of Korea for listed and non-listed companies. 

Matters relating to issuance and management may be delegated to a commissioned trustee company.  Major shareholders, controlled shareholders and other interested parties are prohibited, by the law, to act as trustees. 

• Korean Commercial Code Revisions Make Capital Reductions in Korea Easier 
• No Court Appraisal Necessary for In-Kind Contributions to Company in Korea
• Classification of Directors in Korea under the Korean Commercial Code: Inside, Outside and Other Directors in Korea
• Establishing a Company in Korea: New Corporate Forms Available under Revised Korean Code
• Squeezing-out Minority Shareholders under Korean Corporate Law
• Limiting Director Liability under Korean Law: Don’t Drop the Insurance Policy Yet
• Limited Liability Companies under the KCC

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Sean Hayes, IPG's Co-Chair of the Korea Practice Team, may be contacted at: SeanHayes@ipglegal.com

No Court Apprasial Necessary in Korea for In-Kind Contribution to Company

The Presidential Decree of the amended Korea Commercial Code notes that an appraisal by the Korean courts is no longer necessary when issuing equity stocks in exchange for an in-kind contribution in a company if:

1.  The amount of the in-kind contribution is less than KRW 50,000,000 and accounts for less than 20% of the entire equity of the company;
2.  The value of the in-kind contribution is less than the book value listed in the balance sheet of the issuing company; and
3.  Listed securities are contributed at a price equal to or less than the market price.

Other posts on the amended Commercial Code of Korea:

• Korean Commercial Code Revisions Make Capital Reductions in Korea Easier
• Classification of Directors in Korea under the Korean Commercial Code: Inside, Outside and Other Directors in Korea
• Establishing a Company in Korea: New Corporate Forms Available under Revised Korean Code
• Squeezing-out Minority Shareholders under Korean Corporate Law
• Limiting Director Liability under Korean Law: Don’t Drop the Insurance Policy Yet
• Limited Liability Companies under the KCC

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Sean Hayes, IPG's Co-Chair of the Korea Practice Team, may be contacted at: SeanHayes@ipglegal.com

Medical Malpractice Lawyers in Korea on the New Medical Malpractice Arbitration System

IPG has handled numerous medical malpractice matters for plaintiffs and defendants of medical malpractice cases in Korea in Seoul courts and we were, prior, to having knowledge of the composition of the new Korean Medical Dispute Mediation and Arbitration Agency very pessimistic about its usefulness for plaintiffs. 
 
When we first heard about the enactment of the new Korean medical malpractice law we were skeptical if the system would be useful for plaintiffs, since, often, the court and prosecutors are able to assert more pressure on doctors than this Commission and worried that this agency would be dominated by doctors.

However, after a discussion with one of the standing commissioners of the Korean Medical Dispute Mediation and Arbitration Agency, who we know well and who we worked with in the past, we have come to realize that the composition of the lends itself to providing a fair forum for both doctors and patient plaintiffs.

In many cases, the court may be the best option for a plaintiffs, however, this agency may be more suited in handling the more complex matters, because of the nature of the Korean courts.

We will be writing more articles on medical malpractice in Korea over the next few weeks. 
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IPG's Co-Chair of the Korea Practice Team may be contracted at: SeanHayes@ipglegal.com

Saenuri Party Maintains Control of Korean National Assembly. Philippine-born has been elected to the National Assembly

Saenuri Party Maintains Control of Korean National Assembly.  Philippine-born has been elected to the National Assembly as a Saenuri Party member.

The Saenuri party will hold 152 of the 300-member National Assembly. The Democratic United Party (DUP) will hold 127 seats and the Unified Progressive Party (UPP) will hold 13 seats, while the Liberty Forward Party, a Chungcheong-based party, will hold five seats.
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SeanHayes@ipglegal.com

Korean Election Night Update (April 12, 2012 - 1AM)

The Saenuri (ruling party) is leading in poles in 127 out of a total 246 seats in the Korea National Assembly.  

The  DUP (opposition party) is carrying 107 seats.  The following updates is based on data as of 1AM. 


DUP has carried many seats in Seoul that were once considered conservative safe seats.   The ruling party has gained seats in Gangwan and Chungcheon province. 


The voter turnout was 54.3 percent.  This is 8.2 percentage points higher than the election four years ago. 

The Korean National Assembly is comprised of 246 seats that voters may directly vote for candidates in and 54 proportional representation seats.  The proportional representative seats are allocated to parties in accordance to the total numbers of votes the party receives. 

Each voter may cast two ballots, one for a candidate and the other for the party.
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SeanHayes@ipglegal.com

Divorce/Family Lawyers in Korea: Korean Divorce Explained by U.S. Military

The U.S. Military in Korea drafted an excellent, basic, explanation of the divorce procedure in Korea. Divorce, in Korea, is possible even if both parties to the divorce proceedings are not Korean and were not married in Korea.

As noted in the document, if you are involved in a contested divorce or are not willing to jump through the hoops at the Seoul Family Court in an uncontested divorce, promptly retain a lawyer.  It is essential to obtain an attorney that has handled a significant amount of family law cases for expats.  I advise retaining a Korean attorney that works hand-in-hand with a foreign attorney.

The explanation of the divorce procedure in Korea can be found at: Divorce in Korea.

Other posts on divorce/custody issues in Korea:

• Korean Divorce Checklist for Negotiating a Marital Separation Agreement in Korea
• Getting a Divorce in Korea: Hiring a Korean Divorce Lawyer

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Sean may be contacted at: SeanHayes@ipglegal.com

Why are American Cars not Popular in Korea?: Decrease in Duties from FTA has not Helped Market Share

According to an article in the Korea Times, the Korea-U.S. FTA has not increased the popularity of U.S. cars, even though the price of the cars have decreased by nearly USD 5,000.  Why are U.S. cars not popular in Korea?

The Korea-U.S. free trade agreement (KORUS FTA), which went into effect March 15, removed 5.2 million won ($4,596) from the price of one Ford-made Lincoln, but this failed to boost sales.

The lackluster performance was made more manifest as March saw the biggest monthly increase in the number of newly-registered imported cars; and German brands maintained their dominance.

According to the Korea Automobile Importers and Distributors Association (KAIDA), the number of newly registered imported cars last month increased by 15.8 percent to 10,648 from the previous month.

But the sales of U.S. models from Ford, General Motors and Chrysler fell in growth despite aggressive marketing activities and the 4 percent tariff deductions on all models.

Under the KORUS FTA, tariffs on U.S.-made cars were lowered to 4 percent from 8 percent immediately. The remaining tariffs will be lifted completely in four years.

Ford has lowered its price by around 2.8 million won on average, and has also cut component prices by up to 35 percent.

“We will also introduce new models from May and June,” an official from Ford Korea said. “Our goal this year is to sell over 6,000 cars here.”

Thanks to their aggressive marketing, the sales of Ford surged by 80.9 percent to 416 vehicles in March from the previous month’s 230.

At a glance, this performance seems to be a drastic improvement, but in reality, its cars are actually losing their popularity.

Compared to the same period last year, sales of Ford cars decreased by 5.9 percent and the market share also decreased to 3.91 from 4.4 percent. 

What do you think?
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SeanHayes@ipglegal.com

Korea's Carbon Credit Inititative: Korea Fastest Growing Producer of Carbon in Developed World

Bloomberg posted an article today on the possibility of Korea passing a carbon trading bill.
The Bloomberg articles notes that:

We believe the bill will be passed” as long as lawmakers schedule a vote after the elections, Young Soo Gil, chairman of the Presidential Committee on Green Growth, told reporters today in Seoul.

Lawmakers unexpectedly delayed voting on the bill on Feb. 27, even after Asia’s fourth-largest economy agreed to push back the program’s start by two years to 2015 as the largest companies said it will hurt competitiveness. The government is working to reschedule the vote, with a target of April or May, Nam Kwang Hee, director general of the Presidential Committee on Green Growth, said March 19.

A multiparty panel of the assembly agreed last month on the need to create a market to help reduce carbon-dioxide discharges. The bill has to go to the nation’s Legislation and Judiciary Committee and then to the assembly’s plenary session, the last step for the law.
If the session isn’t held by the end of May, pending bills will expire when the new national assembly is formed in June, Young told reporters.

“As ruling and opposition parties agreed on the need of the legislation, the bill is likely to be passed at the assembly’s plenary session without big changes,” Young said.

The complete article may be found at:  S. Korea Sees Carbon Legislation Possible After April Elections.

Will a carbon credit/trading law open up new opportunities for businesses in Korea?  
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SeanHayes@ipglegal.com