SOUTH KOREA Law and Practice Contributed by: Ho Joon Moon, Tae Jung Kim, Do Kyeom Kim and Ji Geon Park, Lee & Ko
of a material business (assets), sales or trans- fers of treasury stock and issuance of convert - ible bonds or bonds with warrants). Such reports are also made available to the public on DART. “Certain other companies” include those that (pursuant to the External Audit Act and FISCMA) intend to be publicly traded in the relevant or subsequent fiscal year and meet the following conditions: • have total assets of KRW50 billion or more as at the end of the preceding fiscal year or total revenue of KRW50 billion or more for the preceding fiscal year. • fulfil any two of the conditions below: (a) have total assets of KRW12 billion or more as at the end of the preceding fiscal year; (b) have total liabilities of KRW7 billion or more as at the end of the preceding fiscal year; (c) have total revenue of KRW10 billion or more for the preceding fiscal year; or (d) have a total headcount of 100 or more as at the end of the preceding fiscal year. 6.2 Disclosure of Corporate Governance Arrangements For private companies, the articles of incorpora - tion must be kept at the head office and are not made publicly available, although certain parts of the articles (such as the business objectives of the company and the terms of the preferred shares and convertible or redeemable securities) may be gathered from the commercial registry maintained with the court registrar. Any share - holders or creditors of a company may, at any time during its business hours, inspect the arti - cles of incorporation and request a copy thereof.
For publicly traded companies, the articles of incorporation are attached to the annual report and are publicly available on DART. Furthermore, under the FISCMA, companies that are required to submit annual reports, such as publicly traded companies, must submit quar - terly, semi-annual and annual reports to the Financial Services Commission and to the Korea Exchange, which are then publicly disclosed. These reports contain information relating to the composition of the board of directors, major items resolved by the board of directors, includ - ing whether each outside director voted in favour of or against such items and, if applicable, the composition and activities of the subcommittees of the board of directors. 6.3 Companies Registry Filings Certain key information relating to a company, including the registration number, name, reg - istered address, method of public notification, capitalisation, business purposes, information on directors and statutory auditor and infor - mation on rights of class shares, among other information, is required to be registered with the court registrar. Failure to comply with this requirement may result in penalties or other sanctions (eg, fines). Companies that consistently fail to comply with this requirement may also lose their good stand - ing and, in extreme cases, be subject to admin - istrative dissolution. 7. Audit, Risk and Internal Controls 7.1 Appointment of External Auditors Listed companies and certain other companies (as described in 6.1 Financial Reporting ) must
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