Proposed bill: Partial Amendment to the Income Tax Act

Proposed by Rep. Suh Bum-soo (People Power Party)

● The current legal system classifies membership fees paid by trade union members as general donations. However, trade unions are not obliged to submit a statement of account for public disclosure, as this obligation is limited to non-profit, non-governmental organizations designated as “organizations for public interest” by the Minister of Economy and Finance. In order to enhance the transparency in the operation of trade union membership fees, this Amendment includes trade unions into the scope of recipient organizations of general donations that are required to submit their statement of accounts.

Proposed bill: Partial Amendment to the Financial Investment Services and Capital Markets Act

Proposed by Rep. Yun Chang-hyun (People Power Party)

● The majority of acquisitions and mergers in Korea involve obtaining management authority through the acquisition of shares from existing controlling shareholders. However, concerns have been raised regarding the comparative lack of protective measures in Korea’s current legal system in protecting the rights of general minority shareholders and preventing their alienation during this process. This Amendment addresses these concerns by introducing a mandatory tender offer system to safeguard the rights and interests of general shareholders of merged companies during changes in management authority and prevent predatory acquisitions and mergers through opaque transactions. Furthermore, it includes supplementary measures to ensure that the introduced system does not excessively restrict the proper function of acquisition and mergers.

Pending bill: Partial Amendment to the Trade Union and Labor Relations Adjustment Act

Proposed by Rep. Lee Eun-ju (Justice Party)

● Due to the conventional presumption of the worker-employee relationship under the current Act, workers in special employment types and indirectly employed workers are not granted civil immunity for industrial actions. Moreover, the current Act provides a narrow definition of legitimate industrial action, only recognizing disputes over working conditions as industrial disputes. Furthermore, the absence of an upper limit on the amount of damage claims resulting from trade union actions discourages individuals from participating in trade union activities.

This Amendment aims to address these issues and effectively protect the three constitutional labor rights in practice by restricting unreasonable damage compensation claims against individuals, etc., expanding the definition of workers, employers, and industrial disputes, placing stricter restrictions on damage claims, and prohibiting damage claims against individuals.

Promulgated bill: Enforcement Decree of the Monopoly Regulation and Fair Trade Act

Competent Ministry: Korea Fair Trade Commission

● This Bill aims to alleviate the burden of disclosure on companies and encourage market-driven oversight focused on large-scale internal transactions that are proportionate to the size of the economy. It reduces the burden of disclosure for large-scale internal interactions by increasing the threshold value of large-scale internal transactions involving specially related persons, which domestic companies with the duty of disclosure must disclose after obtaining a resolution from the board of directors from 5 billion won ($3.9 million) to 10 billion won.

Administrative announcement: Partial Amendment to the Enforcement Decree of the Integrated Control of Pollutant-discharging Facilities

Competent Ministry: Ministry of Environment

● Starting in July, cement manufacturing industries will be included in the scope of industries subject to the integrated control of pollutant-discharging facilities. This Amendment outlines the necessary criteria pertaining to various aspects, including the establishment, management, and preparation of discharging facilities and prevention facilities, the calculation and investigation of pollutants, and the maximum limit of emission, etc.

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The Korea Herald republishes a weekly legislative report by local law firm DR & AJU LLC to provide the latest information on bills approved, proposed, pending and set to be promulgated. -- Ed.

For any queries about the bills, contact cr@draju.com.