SOUTH KOREA Law and Practice Contributed by: Bo Hee Park, Minhyun Cho, Ian Kim and Jun Hee Kwon, Jipyong LLC
Register of Shareholders A company is required to keep a register of sharehold - ers at its head office, and shareholders and corporate creditors are entitled to inspect or copy it during busi - ness hours. 4.2 Role of Shareholders Shareholders do not have the legal authority to direct - ly instruct the company’s management to perform or refrain from specific business acts. However, share - holders participate in and supervise corporate man - agement through the following means. • Shareholder participation in management: Share - holders participate in corporate management through the general meeting of shareholders by exercising their voting rights, rights to demand the convening of a general meeting of shareholders and shareholder proposal rights. • Shareholder supervision of management: Share - holders hold rights such as the right to demand a director to stop engaging in illegal acts, the right to appoint an inspector, and the right to inspect books and records. Furthermore, shareholders possess various litigation rights, including the right to file lawsuits to challenge the resolution of a gen - eral meeting of shareholder, shareholder derivative suits, lawsuits to nullify the issuance of new shares and lawsuits to nullify incorporation, mergers or divisions. Through these mechanisms, sharehold - ers can effectively supervise corporate manage - ment. 4.3 Shareholder Meetings Holding of Shareholder Meetings Every stock company must hold an ordinary gener - al meeting of shareholders at least once a year at a specified time after the end of each fiscal year, while extraordinary general meeting of shareholders may be When convening a general meeting of shareholders, a written notice must be dispatched to each share - holder two weeks prior to the date of the meeting, or an electronic notice may be sent with the consent of each shareholder. However, for shareholders holding 1% or less of the total issued and outstanding shares, held from time to time as necessary. Convening Procedures and Notice
for the limit on directors’ remuneration, viewing such a shareholder as a “person with a special interest”. Disclosure of Directors’ Remuneration While the limit on directors’ remuneration is disclosed through the general meeting of shareholders, the KCC does not have provisions regarding the actual remuneration paid to directors. However, the Capital Markets Act requires listed companies to disclose the total remuneration paid to all directors in their annual business reports. In certain cases, individual remuneration may be sub - ject to public disclosure. For instance, if the remunera - tion of an individual officer exceeds KRW500 million, the individual remuneration, along with its calculation criteria and method, must be recorded in the public disclosure. Also, if an individual is among the top five highest-paid individuals in the company and his/her remuneration exceeds KRW500 million, his/her indi - vidual remuneration, calculation criteria and method must be recorded in the public disclosure regardless of whether the individual is an officer. Shareholders bear liability only to the extent of the purchase price of the shares they have subscribed for and do not bear direct liability for the company’s debts. The company must treat shareholders equally based on the class and number of shares held. The KCC prescribes equal treatment according to share - holding for voting rights, claims for dividend distribu - tion and claims for the distribution of residual assets. Furthermore, the 2025 amended KCC imposes a duty on directors to treat the interests of all shareholders fairly. Rules and Requirements The core laws and regulations governing the relation - ship between the company and its shareholders are the KCC and the Capital Markets Act. 4. Shareholders 4.1 Companies and Shareholders Relationship Between the Company and Shareholders
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