A Study on the Reform of the Commercial Act in Conformity with Global Standards – Focusing on Corporate Law-

This study presents legislative reform proposals for the Korean Commercial Act (Corporate Chapter), based on criticisms that it does not conform to global standards, with a focus on protecting minority shareholders and restoring trust in the capital markets. First, in terms of corporate governance, the study proposes: easing restrictions on voting rights of interested parties; codifying the obligation to establish internal control systems within the board of directors; harmonizing the approval requirements for directors’ non-competition and self-dealing; and clarifying the rules on provision of benefits during general meetings of shareholders. In the area of finance and accounting, the proposals include permitting the issuance of redeemable convertible preferred shares (RCPS); restructuring the system for treasury stocks; protecting minority shareholders in reverse stock splits; and clarifying accounting standards for interim dividends. Furthermore, with regard to corporate restructuring, the study emphasizes the need to grant appraisal rights to dissenting shareholders in physical (vertical) spin-offs, to prevent abuse of exceptional procedures, and to codify related legal processes. Lastly, the study examines the legislative need to expand the scope of directors’ fiduciary duties from the perspective of shareholder protection, based on both domestic and international discussions and legislative precedents.