S Korea- FTC K Cube Holdings Voting Restrictions

S Korea- FTC K Cube Holdings Voting Restrictions

On 15 December 2022, SK FTC penalized K Cube for violating voting rules.

  • SK FTC issued a corrective order to K Cube Holdings, an affiliate of Kakao Co. Ltd, for violating restrictions on voting rights of financial companies and insurance companies.

Violations

  • Rules state that a company that belongs to a business group subject to cross-investment restrictions, and engages in the financial or insurance business, cannot exercise its voting rights on the stocks of domestic affiliates that it acquires or owns.
  • K Cube had exercised its voting rights on the stocks of Kakao, which was in contravention of articles 11, 16 and 66 of the monopoly regulation and fair trade act.
  • As there was one decision in which the result of the decision was reversed due to the exercise of K Cube's voting rights, it was deemed that the violation was serious.
  • A prohibition order was issued to prevent similar acts in future, and a complaint filed.