SOUTH KOREA Law and Practice Contributed by: Bo Hee Park, Minhyun Cho, Ian Kim and Jun Hee Kwon, Jipyong LLC
• matters concerning the appointment and dismissal of corporate organs – appointment and dismissal of directors, auditors, liquidators, etc; and • other matters closely related to shareholder inter - ests – approval of financial statements, determina - tion of dividends, determination of remuneration for directors, post-formation acquisition, etc. Matters specifically prescribed by the KCC as falling under the authority of the general meeting of share - holders cannot be delegated to the board of directors or the representative director, even by way of an AOI. However, it is permissible for the general meeting of shareholders to decide on significant matters while delegating the determination of specific details to the The board of directors makes decisions regarding the execution of the company’s business. However, as it is impractical and inefficient for the board to decide on every matter regarding corporate operations, routine day-to-day business decision-making and executive authority is considered to be implicitly delegated to the representative director. Nevertheless, the following matters (which the KCC specifically provides as being the power of the board of directors), as well as other significant matters, may not be delegated to the representative director: board of directors. Board of Directors • disposal and transfer of significant assets, borrow - ing of large-scale assets, appointment or dismissal of a manager, and the establishment, relocation or closure of branch offices; • approval of the transfer of shares subject to restric - tion on transfer; • convocation of the general meeting of sharehold - ers; • approval of transactions involving a conflict of interest between a director and the company; and • issuance of new shares. Representative Director (or Executive Officer) For routine day-to-day business, the representative director (or executive officer) is implicitly deemed to have been delegated the decision-making authority,
even in the absence of express delegation from the board of directors. Auditor (or Audit Committee) Each auditor exercises their authority independently. In contrast, the audit committee, being a collegiate body, exercises its authority through resolutions of the committee. The auditor (or audit committee) holds powers such as: • the right to audit business operations; • the right to receive reports from directors on signifi - cant matters; • the right to request the convocation of a general meeting of shareholders; • the right to investigate subsidiaries; • the right to represent the company in lawsuits against directors; • the right to demand that a director stop engaging in illegal acts; and For details regarding the convocation and resolution procedures of the general meeting of shareholders, please refer to 4.3 Shareholder Meetings . Board of Directors Convocation To convene a meeting of the board of directors, notice must be dispatched to each director and auditor one week prior to the meeting date. However, this period may be shortened by the AOI, and a meeting may be held at any time without notice upon the unanimous consent of all directors and auditors. As there are no restrictions on the method of notice, oral notification as well as notification via email is permitted. Resolution Adoption of board resolutions require the attendance of a majority of the directors and the affirmative vote of a majority of the directors present, though the AOI may set a higher threshold. Exceptionally, a two-thirds majority of the directors is required for resolutions regarding the appropriation of corporate opportuni - ties, approval of self-dealing transactions and the dis - missal of audit committee members. • the right to audit financial statements. 2.3 Decision-Making Processes General Meeting of Shareholders
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