'Corporate Merger Legislation Innovation TF' Holds 1st Meeting
Discussing Exemption from Notification, Expansion of Simplified Review, etc.
Fair Trade Commission to Prepare M&A Regulatory Reform Plan Within the Year
[Asia Economy Sejong=Reporter Lee Junhyung] The Fair Trade Commission's 'Corporate Merger Legislation Innovation Task Force (TF)' has been launched. It is evaluated as the first step in the M&A regulatory reform, a national agenda of the Yoon Seok-yeol administration.
The Fair Trade Commission announced on the 30th that it has formed the Corporate Merger Legislation Innovation TF. The TF consists of eight private experts, including Professor Shin Youngsoo of Kyungpook National University Law School, Professor Jung Jaehoon of Ewha Womans University Law School, and Attorney Lee Minho of Kim & Chang Law Firm. The Fair Trade Commission will operate the TF until the end of October. The TF plans to hold one meeting per month to devise improvement measures for the corporate merger system.
The TF will also hold its first meeting this afternoon. At the first meeting, the TF will discuss the TF operation plan along with expanding the scope and targets of corporate merger filing exemptions and simplified reviews. By October, the TF plans to discuss five detailed review tasks, including reviewing the appropriateness of corporate merger filing standards and pre- and post-filing requirements, and the bifurcation of review stages depending on the necessity of in-depth examination.
The Fair Trade Commission formed the TF because it judged that there is a need to improve M&A regulations in line with changes in the market environment. In fact, the number of M&A reviews by the Fair Trade Commission nearly doubled from 602 cases in 2002, twenty years ago, to 1,113 cases last year. During the same period, the M&A market size increased about 23 times from 15.3 trillion won to 349 trillion won.
Another background for the TF is the increase in global M&A led by domestic companies. Last year, the number of global M&A cases handled by the Fair Trade Commission was 180, more than three times the 53 cases in 2009. A Fair Trade Commission official explained, "Large-scale global M&As led by domestic companies frequently occur in various fields such as aviation, semiconductors, and shipbuilding," adding, "Foreign reviews are also becoming stricter, so effective response is important."
The Fair Trade Commission intends to alleviate the regulatory burden on companies pursuing M&A through the TF. Originally, the corporate merger legislation was designed focusing on domestic M&A reviews, and it was pointed out that it operated inefficiently in the process of international cooperation. Accordingly, the Fair Trade Commission plans to comprehensively review measures to prevent confusion caused by institutional differences between countries during the global M&A review process and to establish effective competition recovery measures. Regulatory improvements such as filing exemptions and expanding simplified review targets will also be pursued.
The Fair Trade Commission plans to prepare a corporate merger legislation reform plan within this year by compiling the results of the TF discussions and research. Considering the stakeholder opinion collection process, the legislative amendment procedure is expected to be in full swing from next year.
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