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Korea Herald
15-05-2025
- Business
- Korea Herald
When is foreign too foreign? Korea's takeover tensions
Recent PE-involved M&A deals draw heated debate on security of key strategic technologies A recent streak of mergers and acquisitions led by private equity firms has intensified the debate over foreign-owned companies investing in Korean businesses, raising concerns about the possible outflow of key strategic technologies At the center of the controversy is a recent revision to the Enforcement Decree of the Act on Prevention of Divulgence and Protection of Industrial Technology. The updated regulation, set to take effect on July 22, does not apply "foreign investment" provisions to Korean-registered private equity firms, even if they are effectively controlled by foreign nationals. Previously, the government had considered including such firms under the scope of foreign investors. If enacted, this would have required them to seek prior approval from the Ministry of Trade, Industry and Energy before investing in local companies holding 'national core technologies.' In 2022 at an Industrial Technology Protection Committee meeting, former Industry Minister Lee Chang-yang noted that 'M&As led by local private equity firms, owned by foreigners, are tricky cases to handle." Yet the proposal was excluded from the final version of the revised decree. Experts point out that the revision has a loophole, as it does not define an investment led by a Korea-domiciled company controlled by foreign nationals as foreign. De facto control should be considered when categorizing foreign investment. 'It is not that all foreign nationals are likely to leak core technologies to other countries. That would be an exaggeration, almost xenophobic,' said a professor who specializes in technology security and wished to remain anonymous. 'But without tighter regulations on foreign ownership, foreign capital could indirectly acquire key technologies through domestic entities or funds. The legal loop provides grounds for the overseas leakage of key technologies.' A recent series of M&A deals led by such firms has brought more attention to the revised regulation and its shortcomings. Of the 'big four' PE firms in Korea, two are headed by foreign nationals. Korea Zinc, the world's largest refined zinc smelter, has been engaged in a power struggle against private equity giant MBK Partners since a buyout attempt in September. In a defensive effort to maintain control of the company, Korea Zinc called into question the nationality of the PE firm's chief and the company's funding sources. MBK is led by founder and Chair Michael Byung-ju Kim, a US national. To fend off the MBK camp, Korea Zinc acquired approval from the government to designate its high-nickel precursor manufacturing process as a national core and high-tech strategic technology, which would give the government approval rights in case of an acquisition of Korea Zinc by a foreign company. Though the designation was unlikely to block off MBK's takeover attempt, as the PE is not registered as a foreign company, it was seen as a move to pressure the rival by highlighting the potential of security threats. On a similar note, local chip-to-energy conglomerate SK Group is considering selling its controlling stake in SK Siltron, a semiconductor wafer producer. Local private equity house, Hahn & Co,. is named as a strong contender, given its close ties with the conglomerate. The PE firm has executed multiple deals with SK Group in recent years. Yet again, the nationality of its chief has come into question. While Hahn & Co. is a Korea-registered private equity house, its Chief Executive Officer Scott Sang-won Hahn is a US national. With SK Siltron's crystal growing technology designated a national core technology, a cross-border sell-off of the affiliate would require approval from the government. Hahn & Co., registered here, would be qualified without governmental approval. But the pressure of a potential security breach could work as a pressure, even undermining the firm's big store of dry powder and its strong chip network. 'When it comes to M&A deals on institutions with key strategic technology, the focus should rather be on how the given technology would be managed throughout the years,' an official from a local private equity firm said. 'A safety net is necessary, but the idea of raising guards against a company just because of a foreign national chief is outdated.'
Korea Herald
14-05-2025
- Climate
- Korea Herald
Confused command leaves South Korea unprepared as wildfires spread out of control: report
From 2010-2020, average area scorched by wildfires in South Korea grew 7.8 times bigger, large-scale fires more than tripled As South Korea recovers from its worst wildfire disaster on record, a National Assembly report warns that a fragmented and confusing command structure left firefighting efforts slow and disorganized. In March more than 20 wildfires broke out across the peninsula's southeastern Gyeongsang provinces, fueled by strong winds and dry weather. The fires burned over 104,000 hectares of forest, killed 31 people, and damaged nearly 8,000 homes and facilities. Also affected were 33 cultural heritage sites, including centuries-old temples. It was the most destructive wildfire event in South Korea's history. A report from the National Assembly Research Service published earlier this month points to a key vulnerability in the country's disaster command structure. Under current law, responsibility for wildfire response shifts depending on the size and spread of the fire. The Enforcement Decree of the Framework Act on the Management of Disasters and Safety designates the national Korea Forest Service as the lead agency. But the Forest Protection Act assigns command to local mayors or governors, depending on the fire's size and location. This dual system creates delays and confusion, particularly in the early stages of a wildfire when quick decisions are critical. In the southeastern Uiseong and Yeongdeok regions, emergency orders were reportedly inconsistent, and firefighting efforts were slowed by coordination problems between local officials, the KFS and the National Fire Agency. Wildfires are currently managed through a 13-level response system based on area burned, wind speed and duration. In the initial stages, local authorities can only deploy 50 personnel and limited equipment according to the current law. They must wait for the situation to escalate before receiving outside reinforcement, an approach the report pinpoints as ineffective in fast-moving scenarios. Yoo Jae-beom, the legislative researcher behind the report specializing in the forestry sector, recommends simplifying this system to two or three tiers and transferring early-stage command to either the forest authority, fire response authority or provincial governments. He also supports establishing joint regional wildfire command centers to ensure faster coordination across agencies. Other data cited in the report suggest damage has been growing even before the March wildfires. The average area burned by wildfires in 2020 increased 7.8 times compared to 2010. The number of large-scale wildfires, which are defined as fires damaging over 1 million square meters, has more than tripled (3.7 times). The report also raises concerns over weak enforcement of fire prevention laws. Between 2019 and 2023, fewer than 20 percent of individuals apprehended for starting wildfires, whether through arson or negligence, received jail time or fines. The average fine issued in 2023 was just 2.8 million won (about $2,000). "The fire season now begins in winter, spreads faster in spring and burns more land than ever before," said the research. "Unless we align laws, restructure response systems and invest in fire-resilient forests, the scale of disaster will only grow." mjh@
Korea Herald
14-05-2025
- Climate
- Korea Herald
Confused command leaves South Korea unprepared as wildfires spread out of control: report
From 2010-2020, average area scorched by wildfires in South Korea grew 7.8 times bigger, large-scale fires more than tripled As South Korea recovers from its worst wildfire disaster on record, a National Assembly report warns that a fragmented and confusing command structure left firefighting efforts slow and disorganized. In March more than 20 wildfires broke out across the peninsula's southeastern Gyeongsang provinces, fueled by strong winds and dry weather. The fires burned over 104,000 hectares of forest, killed 31 people, and damaged nearly 8,000 homes and facilities. Also affected were 33 cultural heritage sites, including centuries-old temples. It was the most destructive wildfire event in South Korea's history. A report from the National Assembly Research Service published earlier this month points to a key vulnerability in the country's disaster command structure. Under current law, responsibility for wildfire response shifts depending on the size and spread of the fire. The Enforcement Decree of the Framework Act on the Management of Disasters and Safety designates the national Korea Forest Service as the lead agency. But the Forest Protection Act assigns command to local mayors or governors, depending on the fire's size and location. This dual system creates delays and confusion, particularly in the early stages of a wildfire when quick decisions are critical. In the southeastern Uiseong and Yeongdeok regions, emergency orders were reportedly inconsistent, and firefighting efforts were slowed by coordination problems between local officials, the KFS and the National Fire Agency. Wildfires are currently managed through a 13-level response system based on area burned, wind speed and duration. In the initial stages, local authorities can only deploy 50 personnel and limited equipment according to the current law. They must wait for the situation to escalate before receiving outside reinforcement, an approach the report pinpoints as ineffective in fast-moving scenarios. Yoo Jae-beom, the legislative researcher behind the report specializing in the forestry sector, recommends simplifying this system to two or three tiers and transferring early-stage command to either the forest authority, fire response authority or provincial governments. He also supports establishing joint regional wildfire command centers to ensure faster coordination across agencies. Other data cited in the report suggest damage has been growing even before the March wildfires. The average area burned by wildfires in 2020 increased 7.8 times compared to 2010. The number of large-scale wildfires, which are defined as fires damaging over 1 million square meters, has more than tripled (3.7 times). The report also raises concerns over weak enforcement of fire prevention laws. Between 2019 and 2023, fewer than 20 percent of individuals apprehended for starting wildfires, whether through arson or negligence, received jail time or fines. The average fine issued in 2023 was just 2.8 million won (about $2,000). "The fire season now begins in winter, spreads faster in spring and burns more land than ever before," said the research. "Unless we align laws, restructure response systems and invest in fire-resilient forests, the scale of disaster will only grow."
Korea Herald
21-04-2025
- Politics
- Korea Herald
Following romanization guideline for names on passports not mandatory: court
Online title(?): You can now romanize your name however you like on your passport Names on South Korean passports do not have to follow the government's official romanization rules, according to a recent court ruling. In its ruling unveiled Monday, the Seoul Administrative Court sided with the plaintiff in a case against the Ministry of Foreign Affairs, overturning administrative procedures that denied a name change based on government romanization standards. According to the country's Passport Act, romanization of Korean names on Korean passports should follow the Ministry of Culture's romanization guideline. However, the court ruled that the guideline does not carry binding force, as there is no evidence that allowing alternative spelling would result in immigration control issues, or compromise the credibility of Korean passports. The ruling came after a couple applied for their daughter's passport in 2023, requesting that her name 'Tae' be written as 'Ta' in the English alphabet. However, the passport was issued with the former spelling, which followed official romanization guidelines. The local authority in Suwon, which processed the passport on behalf of the Foreign Ministry, had deemed 'Ta' inconsistent with the romanization rules stipulated by the Culture Ministry. When the parents asked for the name to be changed to their originally requested spelling, the Foreign Ministry rejected the request, citing the Enforcement Decree of the Passport Act, which allows changes only under limited circumstances. The court stated in its decision that although the requested spelling, 'Ta,' may not strictly align with official romanization rules, the rules are essentially a non-binding guideline — not an enforceable legal standard. The court emphasized that unless a requested name change could clearly undermine the international credibility of Korean passports or be exploited for criminal purposes, the government should not refuse such requests. The ruling highlighted that rigidly applying romanization rules undermines the intent to allow flexibility in passport name spellings, particularly in cases where the name requested reflects commonly accepted English naming practices.
Korea Herald
08-04-2025
- Business
- Korea Herald
Promoting employment of older adults, protecting consumers in electronic commerce
The Korea Herald republishes a weekly legislative report by local law firm DR & AJU LLC to provide the latest information on bills approved, proposed, pending and set to be promulgated. — Ed. Proposed Bill: Partial Amendment to the Act on Prohibition of Age Discrimination in Employment and Elderly Employment Promotion Proposed by Rep. Kim Wi-sang (People Power Party) ● This amendment requires employers to provide continued employment in line with the national pension eligibility age, while leaving the choice of specific measures — such as extending the retirement age or rehiring retired employees — up to each company. Proposed Bill: Partial Amendment to the Distribution Industry Development Act Proposed by Rep. Yoon Joon-byeong (Democratic Party of Korea) ● This amendment extends by five years the sunset period for provisions on defining and registering quasi-superstores, as well as designating traditional commerce preservation areas. Pending Bill: Partial Amendment to the Act on the Consumer Protection in Electronic Commerce Proposed by the Government ● This amendment requires mail-order distributors and brokers to appoint domestic agents in Korea, who must handle consumer complaints or disputes and cooperate with Fair Trade Commission investigations into suspected legal violations. Promulgated Bill: Special Act on the Promotion of Offshore Wind Power Distribution and Industry Development Competent Authorities: Ministry of Economy and Finance; Ministry of Trade, Industry and Energy; and Ministry of Oceans and Fisheries ● This bill shifts offshore wind power development to a government-led model by mandating the Ministry of Trade, Industry and Energy and the Ministry of Oceans and Fisheries to operate a site information network, designate preliminary and development districts based on it, and select project operators for each district through tenders. Administrative Announcement: Partial Amendment to the Enforcement Decree of the Act on Restriction on Special Cases Concerning Taxation
