KOSPI-Listed Large Corporations to Be Required to Submit 'English Disclosures' Starting Next Year

From next year, English disclosures will be mandatory for KOSPI-listed companies with assets of 10 trillion won or more.

On the 2nd, the Financial Services Commission and Korea Exchange announced that they have completed the revision of the "Korea Exchange Securities Market Disclosure Regulations and Enforcement Rules" reflecting the mandatory English disclosure requirements. This is a follow-up measure to the phased expansion plan for English disclosures included in the "Measures to Enhance Foreign Investors' Access to the Capital Market" announced in January.

The authorities plan to gradually mandate English disclosures focusing on important information for large-scale listed companies in two phases: Phase 1 (2024?2025) and Phase 2 (from 2026). Related support will also be provided to facilitate this.

Phase 1, which will be applied from next year, targets KOSPI-listed companies with assets of 10 trillion won or more, or KOSPI-listed companies with a foreign ownership ratio of 30% or more (with assets between 2 trillion and less than 10 trillion won). These companies must submit Korean disclosures to the exchange regarding ▲settlement-related matters (such as decisions on cash or in-kind dividends), ▲major decision-making matters (such as decisions on paid or free capital increases), and ▲matters involving trading suspension (such as decisions on stock cancellation), and then submit English disclosures within three days. In Phase 2, starting from 2026, the target companies will be expanded to KOSPI-listed companies with assets of 2 trillion won or more.

Despite foreign shareholders accounting for 30.8% of the domestic capital market (based on KOSPI at the end of 2022), there have been criticisms that related disclosure information was not sufficiently provided. The financial authorities stated, "Through this measure, English disclosures will be more activated, improving foreign investors' access to information and contributing to enhancing the global competitiveness of our capital market."

Meanwhile, the Financial Services Commission and Korea Exchange also announced plans to support companies to ensure the smooth implementation of the expanded English disclosure measures. The Korea Exchange will provide incentives such as exemption from annual fees and listing fees for companies excelling in English disclosures, expand translation support services from professional translation firms, and prepare English disclosure guidelines as part of the support measures.