Application of Financial Services Commission Guideline Changes
Peer-to-peer trading on platforms like Toss prohibited
Only companies that have submitted disclosure documents can trade
Less than 5% of companies meet the requirements
[Asia Economy Reporter Park So-yeon] From July, peer-to-peer trading of unlisted stocks such as Viva Republica (Toss), K-Bank, and Yanolja will be suspended.
According to the investment industry on the 13th, the Financial Services Commission (FSC) has mandated that from July, unlisted stock trading platforms such as Dunamu (Securities Plus Unlisted) and PSX (Seoul Trading Unlisted) will only allow trading when the issuing company has submitted disclosure documents such as business reports. In March, the FSC presented these guidelines when designating or renewing Dunamu, PSX, and other companies as innovative financial service providers for unlisted stock trading.
Starting next month, issuing companies must disclose information about the issuer, business reports, audit reports, and other documents through the platform to enable unlisted stock trading. Additionally, issuing companies must appoint one disclosure officer responsible for disclosures as the disclosure entity and establish an immediate communication system with the innovative financial service provider operating the platform. Platform companies must publicly announce companies that fail to submit regular disclosure documents or comply with ad-hoc disclosures, and establish criteria for designating companies with poor disclosure practices, including suspension of trading and deregistration.
Currently, companies that have reorganized their systems to meet these standards and submitted disclosure documents to platform operators within the deadlines set by the FSC account for less than 5% of all companies trading unlisted stocks. Most major companies fall short of the FSC’s criteria. Going forward, general investors will be unable to purchase stocks of unlisted companies that do not meet the FSC standards, though selling will still be permitted. However, professional investors will be able to continue both buying and selling as before.
The industry analyzes that the unlisted investment market, which recently gained significant popularity among general investors, will revert to being dominated by institutions and high-net-worth individuals. There are also concerns about side effects arising from disposing of over-the-counter stocks outside of unlisted stock platforms. An industry insider said, "If the FSC guidelines are followed, most major unlisted companies such as Toss, K-Bank, and Oasis will become untradeable," adding, "The market will return to being centered on buyers and professional investors."
Meanwhile, Dunamu and PSX were designated as innovative financial services in April 2020, gaining the qualification to conduct unlisted stock trading without a financial investment business license. Since then, both companies have developed systems to trade unlisted stocks via mobile apps, introduced securities account linkage, and implemented safe transaction settlements. Securities Plus Unlisted offers trading for about 457 companies, and Seoul Trading Unlisted for about 200 unlisted companies.
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