SOUTH KOREA Law and Practice Contributed by: Ki Wook Kang, Kyung Chun Kim, Junghae Kang and Do Kyeom Kim, Lee & Ko
3. Recent Legal Developments 3.1 Significant Court Decisions or Legal Developments Introduction of Electronic Shareholders’ Meeting System for Listed Companies On 22 July 2025, a partial amendment to the Kore - an Commercial Code was promulgated, and the amended provisions concerning the introduction of electronic shareholders’ meetings for listed compa - nies are scheduled to take effect on 1 January 2027. Under the amended Commercial Code, a listed com - pany may hold an electronic shareholders’ meeting in parallel with an in-person meeting at the place of convocation, and certain listed companies prescribed by Presidential Decree meeting certain criteria such as total assets will be required to hold shareholders’ meetings electronically. This amendment is expected to serve as a catalyst for expanding the exercise of shareholder rights by facilitating greater participation of minority shareholders in shareholders’ meetings of listed companies. In addition, adequate preparation of technical measures – such as the establishment of relevant IT infrastructure – will be essential for the successful implementation of electronic shareholders’ meetings. See the South Korea Trends and Develop - ments article in this guide for further details. Appointment and Expansion of Mandatory Ratio of Independent Directors in Listed Companies On 22 July 2025, a partial amendment to the Korean Commercial Code was promulgated, and the amend - ed provisions concerning the appointment of inde - pendent directors and the expansion of the mandatory appointment ratio for listed companies are scheduled to take effect on 23 July 2026. Under the amended Commercial Code, an independent director is defined as an outside director who is independent from inside directors, executive officers, and persons directing the execution of business. Listed companies will be required to appoint independent directors rather than outside directors that do not meet such independ - ence criteria, and the mandatory appointment ratio will be increased from at least one-fourth of the total number of directors to at least one-third (provided that companies with total assets of KRW2 trillion or more as of the end of the immediately preceding fis - cal year continue to appoint independent directors
constituting a majority of the board, as under the cur - rent regime). Compliance with the revised mandatory ratio will be required by 22 July 2027. It remains to be seen whether this amendment will amount merely to a change in terminology or will substantively strengthen the role of independent directors. Further academic and practical discussions, as well as the establish - ment of judicial precedents, would be necessary to clarify the specific meaning of independent directors and the criteria for assessing their independence. See the South Korea Trends and Developments article in this guide for further details. Strengthening of Treasury Share Disclosure Requirements for Listed Companies Amendments to the Enforcement Decree of the Finan - cial Investment Services and Capital Markets Act, principally aimed at strengthening treasury share dis - closure requirements for listed companies, took effect on 30 December 2025. The key features of these amendments include: (i) expansion of the scope and frequency of required disclosures; (ii) the addition of a comparison between treasury share disposition plans and actual implementation status; and (iii) enhanced sanctions for violations of treasury share disclosure obligations. As listed companies will be required to reflect these amended provisions beginning with their annual reports and other periodic filings to be sub - mitted in 2026, prompt preparation and compliance measures will be necessary. See the South Korea Trends and Developments article in this guide for fur - ther details. Introduction of the Yellow Envelope Act On 9 September 2025, an amendment to the Trade Union and Labor Relations Adjustment Act (com - monly referred to as the Yellow Envelope Act) was promulgated and is scheduled to take effect on 10 March 2026. Under the amended law: (i) the defini - tion of “employer” is expanded to include any person who substantively governs or determines the working conditions of workers other than its directly employed employees, thereby allowing labour unions composed of indirectly employed workers or workers without a direct contractual employment relationship to demand collective bargaining with the principal contractor, par - ent company, or similar entity where such criteria are satisfied; (ii) the scope of activities that are subject
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