Kwon Seongdong: "This is not about overlooking reckless management by major shareholders"
Kwon Youngse: "Exercising the veto on the amendment to the Commercial Act... a natural action"
On the 1st, the People Power Party stated that the exercise of the veto power by Acting President and Prime Minister Han Duck-soo regarding the amendment to the Commercial Act is "a natural action" and announced plans to push for amendments to the Capital Market Act.
Kwon Seong-dong, the floor leader of the People Power Party, met with reporters at the National Assembly on the same day and said, "After rejecting the amendment to the Commercial Act (in the National Assembly re-vote), we will actively cooperate with the Democratic Party to pass the amendment to the Capital Market Act." He added, "Through the Capital Market Act, we can first regulate only listed companies to see if there are any side effects and then proceed to the next step," explaining, "This is not about overlooking the reckless management by major shareholders."
Acting President and Prime Minister Han Duck-soo declared the opening by striking the gavel at the Cabinet meeting held at the Government Seoul Office on the 1st. Photo by Yonhap News
Kwon Young-se, the emergency committee chairman of the People Power Party, also met with reporters after attending the 'Artificial Intelligence (AI) Ecosystem Construction Meeting' held in Seocho-gu, Seoul, and said, "Both I and Floor Leader Kwon requested the exercise of veto power on the amendment to the Commercial Act," adding, "Since it was done accordingly, I naturally thought it would happen that way."
Earlier, Acting President Han held a Cabinet meeting and exercised veto power on the amendment to the Commercial Act. Han said, "I deeply sympathize with the basic purpose of the amendment to the Commercial Act," but added, "In a situation where it can significantly affect the management environment and competitiveness of not only large corporations but also the majority of companies including small and medium enterprises, we need to find alternatives to minimize side effects through more in-depth discussions."
The amendment to the Commercial Act, which was passed by the opposition-led National Assembly plenary session on the 13th of last month, mainly expands the duty of loyalty of directors to include not only the company but also the shareholders.
So far, the People Power Party has opposed the amendment to the Commercial Act pushed by the Democratic Party, arguing that it applies to about one million corporations in total and burdens unlisted companies. Kim Sang-hoon, the policy chief of the People Power Party, said at the morning floor strategy meeting, "The Democratic Party's amendment to the Commercial Act is a bill that places a heavy burden on stock corporations," adding, "The economy is difficult these days, and companies' corporate tax payment performance is poor. At such a time, the amendment to the Commercial Act, which excessively infringes on corporate management rights, should not be implemented."
Due to Acting President Han's exercise of veto power, the amendment to the Commercial Act will return to the National Assembly for a re-vote procedure. For the re-vote bill to pass, a majority of the total members must be present, and two-thirds or more of the attending members must approve it. The People Power Party plans to discuss rejecting the amendment to the Commercial Act as the party's official stance at a party members' meeting. Park Soo-min, the floor spokesperson of the People Power Party, told reporters in a phone call, "The amendment to the Commercial Act will cause a stock market crash and increase damage to minority shareholders," and stated, "We will discuss with members and reject the amendment to the Commercial Act in the National Assembly re-vote."
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