You are here:
AsianLII >>
Databases >>
Laws of the Republic of Korea >>
ENFORCEMENT DECREE OF THE MONOPOLY REGULATION AND FAIR TRADE ACT
[Database Search]
[Name Search]
[Noteup]
[Help]
ENFORCEMENT DECREE OF THE MONOPOLY REGULATION AND FAIR TRADE ACT
ENFORCEMENT DECREE OF THE MONOPOLY REGULATION AND FAIR TRADE ACT
INTRODUCTION
Details of Enactment and Amendment
- Enactment: This Decree was enacted by the Presidential Decree No. 10267 on April 1, 1981, for the purpose of prescribing the matters
delegated by the Monopoly Regulation and Fair Trade Act (Act No. 3320, December 31, 1981) those necessary for the enforcement therof
following the enactment of the said Act.
- Amendment: This Decree has arrived at its present form as a result of being amended 18 times with the latest amendment on June 30,
2005 after it was wholly amended on April 14, 1990 following its enactment.
Main Contents
- This Decree prescribes detailed requirements of combination of enterprises recognized exceptionally for strengthening of international
competitiveness.
- This Decree prescribes that the Government-invested institutions pursuant to the Framework Act on the Management of Government-Invested
Institutions and enterprise group governed by public corporation pursuant to the Securities and Exchange Act shall be excluded from
the designation object in view of the quality of public interest.
- This Decree prescribes that international contract bigger than a certain standard shall be reported, and when the head of the relevant
administrative agency deems that it does not fall under the unjust international contract, it shall be authorized or accepted and
informed of the fact to the Fair Trade Commission.
- This Decree prescribes in detail the procedures, etc. for the examination, recommendation of correction, advance consultation of
contents of announcement of violation by the Fair Trade Commission and public officials belonging thereto.
- This Decree prescribes the requirements of authorization of joint activity for research and development of technology among the
acknowledged exception objects of limitation on unjust joint activities.
- This Decree prescribes the standards for the designation of large conglomerate whose debt guarantee is limited according to the
order of total amount of asset of subsidiary companies.
- This Decree prescribes the standards for the disposition of business suspension or imposition of penalty surcharge in case where
a card business operator, etc. violates the Acts and subordinate statutes.
ENFORCEMENT DECREE OF THE MONOPOLY REGULATION AND FAIR TRADE ACT
Amended by Presidential Decree No. 19023, Aug. 31, 2005
CHAPTER I GENERAL PROVISIONS
Article 1 (Purpose)
The purpose of this Decree is to provide for matters delegated by the Monopoly Regulation and Fair Trade Act and other necessary matters
to implement the delegated matters. <Amended by Presidential Decree No. 16221, Mar. 31, 1999; Presidential Decree No. 18768, Mar.
31, 2005>
Article 2 (Standards for Holding Company)
(1)The term company whose total amount of assets are above an amount as determined by the Presidential Decree in the main sentence
of subparagraph 1-2 of Article 2 of the Monopoly Regulation and Fair Trade Act (hereinafter referred to as the Act ) means the company
whose total amount of assets on the balance sheet as of the closing date [referring to the date of incorporation registration, the
date of merger registration or the date of division registration in case of a company that is newly incorporated or merged, divided,
merged through division or physically divided (hereinafter referred to as division ) during the current business year; hereinafter
the same shall apply] of the immediately preceding business year amounts to not less than 100 billion won. <Amended by Presidential
Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 17564, Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
(2) The standards for the main business referred to in the latter sentence of subparagraph 1-2 of Article 2 of the Act shall be based
on the case where the aggregate value (referring to the aggregate amount of value on the balance sheet as of the closing date of
the immediately preceding business year) of stocks (including equities; hereinafter the same shall apply) held by the subsidiaries
of a holding company exceeds 50/ 100 of the total amount of assets held by the holding company.
(3) The term standards prescribed by the Presidential Decree in subparagraph 1-3 of Article 2 of the Act means satisfying the requirements
falling under the following subparagraphs: <Newly Inserted by Presidential Decree No. 17176, Mar. 27, 2001; Presidential Decree
No. 18768, Mar. 31, 2005>
1.It is required to be an affiliate of a holding company (excluding an affiliate formed in such a way that a small and medium enterprise
start-up investment company established under the Support for Small and Medium Enterprise Establishment Act or an operator of a new
technology business finance company established under the Special Credit Financial Business Act acquires the stocks of another domestic
company for the purpose of making a start-up investment or assisting an operator of a new technology business); and
2.Shares held by a holding company independently or jointly with its subsidiary and business-related sub-subsidiary are required to
be equal to or higher than those held by the largest investor from among each person prescribed by subparagraph 1 or 2 of Article
11.
[This Article Wholly Amended by Presidential Decree No. 16221, Mar. 31, 1999]
Article 2-2 (Standards for Business-Related Sub-Subsidiary)
The term company whose business maintains a close relationship with its subsidiary, which is prescribed by the Presidential Decree
in subparagraph 1-4 of Article 2 of the Act means the company that runs a business falling under any one of the following subparagraphs:
1.The business of transporting, keeping in custody, or selling goods manufactured by its subsidiary or selling services provided by
its subsidiary;
2.The business of rendering services needed to maintain or manage goods or services manufactured or provided by its subsidiary or
to repair such goods;
3.The business of manufacturing or selling goods or services by mainly using the goods or services of its subsidiary;
4. The business of supplying raw materials, services, etc. needed by its subsidiary for production;
5.The business of conducting the research and development of goods or services manufactured or provided by its subsidiary;
6.The business of manufacturing or selling goods or services which are identical with those produced by its subsidiary or which are
produced or provided by sharing most manufacturing techniques with its subsidiary; and
7.Other business having a close relationship with business activities of its subsidiary.
[This Article Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005]
Article 3 (Scope of Enterprise Group)
The term company in virtual control of the business according to the standards prescribed by the Presidential Decree in subparagraph
2 of Article 2 of the Act means the company falling under each of the following subparagraphs: <Amended by Presidential Decree
No. 16221, Mar. 31, 1999; Presidential Decree No. 16777, Apr. 1, 2000; Presidential Decree No. 17176, Mar. 27, 2001; Presidential
Decree No. 17564, Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.The company in which the same person holds independently or in concert with other person (hereinafter referred to as the interested
person ) falling under any of the following subparagraphs not less than 30/100 of the total number of stocks issued by the company
concerned (excluding non-voting stocks under Article 370 of the Commercial Act; hereinafter the same shall apply in this Article,
Articles 3-2, 17-5 and 18) and which falls under the largest investor of the company concerned:
(a) A spouse, a blood relative within the eighth degree or a relative within a cousin (hereinafter referred to as the relative );
(b) A non-profit juristic person or an organization (referring to an unincorporated association or a foundation; hereinafter the same
shall apply) to which the same person makes independently or in concert with the interested person not less than 30/100 of contributions
as the biggest contributor or which either the same person or the interested person has established;
(c) A non-profit juristic person or association which is subject to dominant influence by the same person, directly or through the
interested person with regard to the appointment of directors or officers, or to the operation of businesses;
(d) A company the contents of whose business are in fact controlled by the same person in accordance with the provisions of this subparagraph
or subparagraph 2; and
(e) An employee of the same person or persons having relations as falling under items (b) through (d) (referring to directors or officers
in cases of a juristic person, or trade employee or employees subject to contract of employment in cases of individuals); and
2.A company falling under any of the following items and being regarded as exercising controlling influences upon the management of
the company concerned:
(a) A company of which the representative director is appointed or discharged by, or of which not less than fifty percent of directors
or officers have been or can be appointed by contracts or agreements between the same person and other influential stockholders;
(b) A company which is subject to controlling influences by the same person, directly or through the interested person, upon making
any principal decisions or conducting services such as institutional changes in the company concerned or investments into new businesses,
etc.;
(c) A company which has personnel exchanges falling under any of the following sub-items between the company concerned and the company
under the control of the same person (including the same person in cases where the same person is a company; hereafter the same shall
apply in this item):
( )Where the competent company shares directors or officers of a company under the control of the same person;
( )Where directors or officers of a company under the control of the same person are reinstated to such positions after having been
appointed directors or officers of the company (including cases in which they are reinstated to another company under the control
of the same person); and
( )Where directors or officers of the competent company are reinstated to such positions of the company or its affiliate company after
having been appointed to directors or officers of a company under the control of the same person; and
(d) A company which makes transactions of funds, assets, goods, or services, etc. with the same person or interested person, exceeding
an ordinary scope, a company which gives and takes debt guarantees, or other companies which may be recognized as economic entities
identified with the same person from the point of common knowledge in a society since the company conducts business activities in
a way that it can be considered as an affiliate company of the enterprise group of the same person.
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
Article 3-2 (Exclusion from Enterprise Group)
(1) Where it deems that the same person does not control activities or contents of business of a company as falling under any of the
following subparagraphs, the Fair Trade Commission, upon the request of interested persons, may exclude the company from the scope
of the enterprise group under the control of the same person, despite the provisions of Article 3: <Amended by Presidential Decree
No. 16221, Mar. 31, 1999; Presidential Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 17317, Jul. 24, 2001; Presidential
Decree No. 18768, Mar. 31, 2005>
1.A company which is in fact managed by a person other than each person of the following items in accordance with agreements or contracts
made between investors:
(a) A person who has been appointed by the same person; and
(b) A person who has relationships with the same person as falling under subparagraph 1 (a) or (e) of Article 3;
2.A company which satisfies such requirements as provided in each of the following items (hereinafter referred to as the criteria
for the recognition of independent management ), and which is recognized as managed independently by relatives of the same person:
(a) The aggregate of shares of each company requesting the exclusion from an enterprise group under the control of the same person
(hereinafter referred to as affiliate company of relatives ) which are owned by the same person and interested person [excluding
a person who performs an independent management of an affiliate company of relatives (hereinafter referred to as the independent
manager ) and a person whom the Fair Trade Commission recognizes, upon the request of an independent manager, excluded from the scope
of interested person] shall be less than 3/100 (10/100 in case of a company that is not a stock-listed corporation or Association-registered
corporation) of the total number of shares issued by each company;
(b) The aggregate of shares of each company under the control of the same person (referring to one of the companies belonging to an
enterprise group under the control of the same person after excluding affiliate companies of relatives; hereinafter referred to as
the affiliate company of the same person ) which are owned by independent managers and persons having relations with the independent
managers as falling under each item of subparagraph 1 of Article 3 (limited to a person excluded from such scope in accordance with
the provisions of item (a), in case of interested person) shall be less than 3/100 (15/100 in case of a company that is not a stock-listed
corporation or Association-registered corporation) of the total number of shares issued by each company;
(c) There shall not be a sharing of directors or officers between affiliate companies of the same person and relatives;
(d) There shall not be guaranty of debts, or lending or loaning money between affiliate companies of the same person and relatives:
Provided, That this shall not apply in cases of guaranty of debts, or lending or loaning money which has been considered to have
taken place in normal ways as collateral to the debt guarantees under Article 10-2 (1) 1 of the Act or transactions; and
(e) Deleted; <by Presidential Decree No. 16221, Mar. 31, 1999>
3.A company that is in bankruptcy proceeding after having been sentenced bankrupt under the Bankruptcy Act;
4.A company corresponding to the agreement-concluding firm under subparagraph 2 of Article 2 of the Corporate Restructuring Investment
Companies Act, which satisfies the requirements falling under the following items:
(a)The rights for disposal, and exercising voting rights, of shares owned in excess of 3/100 of the total number of shares issued
by the relevant company (10/100 in case of a company which is not a stock-listed corporation or Association-registered corporation)
from among the shares owned by the same person and interested person, shall be entrusted to the creditor financial institutions (referring
to financial institutions under the Banking Act and other Acts, which have provided credits to the relevant firms); and
(b)The same person and interested person shall conclude a special agreement waiving the terminating right for the entrustment contract
under item (a); and
5.A company for which a procedure for reorganization is in progress by receiving a decision on commencing the reorganization procedure
under the Company Reorganization Act, and which satisfies the requirements falling under the following items:
(a)The rights for disposal, and exercising voting rights, of shares owned in excess of 3/100 of the total number of shares issued
by the relevant company (10/100 in case of a company which is not a stock-listed corporation or Association-registered corporation)
from among the shares owned by the same person and interested person, shall be entrusted to the receiver under Article 94 of the
Company Reorganization Act, but after the completion of reorganization procedures, the relevant rights shall be succeeded by the
company; and
(b)The same person and interested person shall conclude a special agreement waiving the terminating right for the entrustment contract
under item (a).
(2) The Fair Trade Commission may, with respect to any company falling under any of the following subparagraphs, notwithstanding the
provisions of Article 3, upon receiving a request from interested persons, exclude such company from the category of an enterprise
group under control of the same person: <Amended by Presidential Decree No. 16685, Dec. 31, 1999; Presidential Decree No. 17176,
Mar. 27, 2001; Presidential Decree No. 18736, Mar. 8, 2005; Presidential Decree No. 18768, Mar. 31, 2005>
1.A corporation incorporated for private investment business under the Act on Private Participation in Infrastructure in the event
that any person falling under any of the following items holds not less than 20/100 of total number of stocks issued by such corporation:
Provided, that the same shall be limited to a case where the corporation has not made any mutual investment with another company
and has not been guaranteed by any person other than investors for any repayment of debts:
(a)The State or a local government;
(b)A government-invested institution established under Article 2 of the Framework Act on the Management of Government-Invested Institutions;
and
(c)A public corporation or other corporation established pursuant to any special Act; and
2.A company in which not less than two largest investors (including the case where the same person and interested person make investments)
exist and do not exercise any controlling influence over the composition of officers and business operations, etc. from among companies
falling under any of the following items:
(a) A company incorporated by not less than two companies that run the same type of business for the purpose of restructuring their
business through such methods as investment in kind of their assets and a merger, etc.; and
(b)A company that runs the private investment business in a manner described in the provisions of subparagraphs 1 through 4 of Article
4 of the Act on Private Participation in Infrastructure from among corporations incorporated for the private investment business
in accordance with the same Act.
(3)Where a company which has been excluded from the scope of an enterprise group under the control of the same person in conformity
with the provisions of paragraph (1) or (2) does not satisfy the requirements for exclusion, the Fair Trade Commission may, ex officio
or upon the request by the interested persons, cancel such decisions excluding the company from such enterprise group: Provided,
That with respect to a company which has been excluded from the scope of an enterprise group under the control of the same person
in conformity with the provisions of paragraph (1) 2, this shall only apply to the cases where it does not satisfy the requirements
for exclusion not later than three years after the date of exclusion.
(4)Any person, who intends to request the exclusion from the enterprise group controlled by the same person pursuant to paragraph
(1) 2, shall furnish the documents falling under each of the following subparagraphs to the Fair Trade Commission: Provided, That
where it is possible to confirm the information on the documents to be furnished through the joint use of the administrative information
under Article 21 (1) of the Act on Promotion of the Digitalization of Administrative Affairs, etc. for Creation of Digital Government,
such confirmation may substitute the documents to be furnished: <Amended by Presidential Decree No. 16221, Mar. 31, 1999; Presidential
Decree No. 18312, Mar. 17, 2004; Presidential Decree No. 18768, Mar. 31, 2005>
1.A roster of stockholders in case of paragraph (1) 2 (a) and (b). Where his company is a stock-listed corporation, a written confirmation
certified by a title transfer agent shall be attached;
2.Copies of registers of affiliates owned by the same person or by his relatives in case the company concerned falls under paragraph
(1) 2 (c); and
3.Current debt-repayment guarantees and financial borrowing and lending confirmed by a certified public accountant in case the company
falls under paragraph (1) 2 (d).
[This Article Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997]
Article 4 (Methods of Calculating Sales or Purchases, etc.)
(1) The term amount of annual sales or purchases referred to in the proviso of subparagraph 7 of Article 2 of the Act means the
amount of goods or services (referring to the amount excluding indirect taxes imposed on goods or services; hereinafter the same
shall apply) supplied or purchased by the enterpriser concerned for one year in the business year immediately preceding the business
year belonging to the end of the day the act he performs is suspected of violating the provisions of Article 32 of the Act (in case
the act concerned continues until the day it is known or reported, the day of knowing it or the day of reporting it shall be deemed
the end of day; hereinafter the same shall apply).
(2) The term market share referred to in subparagraph 7 of Article 2 and Article 4 of the Act means the share of the amount of goods
or services supplied or purchased by the enterpriser concerned at home from among the amount of goods or services supplied or purchased
by the enterpriser concerned for one year in the business year immediately preceding the business year belonging to the end of the
day the act he performs is suspected of violating the provisions of Article 3-2 of the Act: Provided, That where it is difficult
to calculate the market share in terms of amount, it may be calculated in terms of quantity or production capacity.
(3) The enterpriser and his affiliates shall be deemed one enterpriser in the application of subparagraph 7 of Article 2 and Article4
of the Act.
(4) Detailed standards necessary to judge market controlling enterprisers referred to in subparagraph 7 of Article 2 of the Act may
be prescribed and put on public notice by the Fair Trade Commission.
[This Article Wholly Amended by Presidential Decree No. 16221, Mar. 31, 1999]
Article 4-2 (Delegation of Market Structure Survey or Publication Affairs)
(1) The Fair Trade Commission may delegate its official business concerning the survey of monopolistic and oligarchic markets, the
publication of the results of the survey and requests for data to heads of administrative agencies concerned or heads of government-funded
research institutes under Article 3 (5) of the Act.
(2) Heads of institutions delegated with the official business concerning the survey of market structure and the publication of the
results of the survey under paragraph (1) shall notify the Fair Trade Commission of how they carry out the delegated official business.
[This Article Newly Inserted by Presidential Decree No. 16221, Mar. 31, 1999]
CHAPTER II PROHIBITIONOFABUSE OFMARKET-DOMINATING POSITION
Article 5 (Type of or Standards for Act of Abuse)
(1) Unreasonable decisions, maintenance, or changes concerning prices referred to in Article 3-2 (1) 1 of the Act shall be the case
where prices of goods and services are sharply raised or moderately brought down without any justifiable reasons in contrast to changes
in their supply and demand, and costs (limited to the normal levels of the same or similar type of business) necessary to supply
the goods and services.
(2) The unreasonable control over sales of goods and rendering of services referred to in Article 3-2 (1) 2 of the Act shall be the
case falling under any of the following subparagraphs:
1.The case where the supply of goods and services is sharply reduced without any justifiable reasons in the light of recent market
trends; and
2.The case where the supply of goods and services is reduced without any justifiable reasons despite a short supply in distribution
channels.
(3) The unfair obstruction of business activities carried out by other enterprisers referred to in Article 3-2 (1) 3 of the Act shall
be the case where business activities are made hard to be carried by other enterprisers by performing directly or indirectly the
act falling under any of the following subparagraphs: <Amended by Presidential Decree No. 17176, Mar. 27, 2001>
1.The act of obstructing the purchase of raw materials by other enterprisers for their production activities without any justifiable
reasons;
2.The act of employing workers essential for other enterprisers to carry out their business activities, promising the workers economic
interests that are deemed abnormally higher in the light of normal practices;
3. The act of denying, interrupting or limiting access to the use of elements indispensable for other enterprisers to produce, supply
and market their goods and services without any justifiable reasons; and
4.The act of making it difficult for other enterprisers to carry out their business activities in unfair ways other than those referred
to in subparagraphs 1 through 3, which is put on public notice by the Fair Trade Commission.
(4) The unfair obstruction of participation by new business rivals referred to in Article 3-2 (1) 4 of the Act shall be the case where
new business rivals are made hard to enter the business by performing directly or indirectly the act falling under any of the following
subparagraphs: <Amended by Presidential Decree No. 17176, Mar. 27, 2001>
1.The act of concluding an exclusive transaction contract with a distributor without any justifiable reasons;
2.The act of acquiring rights by purchase, etc. which are necessary for existing enterprisers to continue their business activities;
3.The act of denying or limiting access to the use of elements indispensable for new business rivals to produce, supply, and market
their goods and services without any justifiable reasons; and
4.The act of making it difficult for new business rivals to enter the business in unfair ways other than what is referred to in subparagraphs
1 through 3, which is put on public notice by the Fair Trade Commission.
(5) The unfair transaction designed to put business rivals out of the business under Article 3-2 (1) 5 of the Act shall be the case
falling under any of the following subparagraphs:
1.The case where goods and services supplied at lower prices than normally trading prices or goods and services purchased at higher
prices than normally trading prices are feared to put business rivals out of the business; and
2.The case where the business is done on the condition that business partners do not trade with business rivals.
(6) The detailed type of the act of abuse and standards for the act of abuse referred to in paragraphs (1) through (5) may be prescribed
and put on public notice by the Fair Trade Commission.
[This Article Wholly Amended by Presidential Decree No. 16221, Mar. 31, 1999]
Article 6 (Request for Price Investigation)
If there is a reasonable ground to believe that a market-dominating enterpriser has determined, maintained or changed unfairly the
price of goods or services, the Fair Trade Commission may request any investigation on the price of commodities or services by the
head of the administrative agency concerned or any public organization carrying out price investigation affairs.
Article 7 Deleted.
<by Presidential Decree No. 16221, Mar. 31, 1999>
Article 8 (Method of Publishing Fact of Receiving Corrective Order)
The Fair Trade Commission shall, if it intends to order any enterpriser [any enterprisers organization in case of Article 27 (including
members of such organization if necessary)] to publish the fact of receiving a corrective order under Articles 5, 16 (1), 21, 24,
27 and 31 of the Act, issue such orders after prescribing contents of the publication, types and numbers of the media and paper spaces,
etc. taking into account the matters falling under the following subparagraphs: <Amended by Presidential Decree No. 15328, Mar.
31, 1997; Presidential Decree No. 16221, Mar. 31, 1999; Presidential Decree No. 16430, Jun. 30, 1999; Presidential Decree No. 17176,
Mar. 27, 2001; Presidential Decree No. 17564, Mar. 30, 2002>
1.Details and extent of the act of violation; and
2.Period and frequency of the act of violation.
Article 9 (Methods for Computing Surcharge)
(1) The term turnover determined by the Presidential Decree in the main sentences of Articles 6, 22, 24-2, 28 (2), 31-2 and 34-2
of the Act means the average turnover of the immediately preceding three business years of the enterpriser concerned (hereinafter
referred to as the average turnover ): Provided, That where three years have not elapsed since the business commencement as of the
first date of the current business year, it shall be the amount computed by converting the turnover from the commencement of the
business up to the ending date of the immediately preceding business year to an yearly average turnover, and where the business has
commenced during the current business year, the amount computed by converting the turnover from the date of the business commencement
up to the date of violation to an yearly turnover. <Amended by Presidential Decree No. 18356, Apr. 1, 2004>
(2) Other matters necessary for the computation of average turnover shall be determined by the Fair Trade Commission. <Amended
by Presidential Decree No. 18356, Apr. 1, 2004>
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
Article 9-2 (Scope of Enterprisers Using Business Profits)
The term cases of enterprisers as designated by the Presidential Decree in the main sentence of Article 6 of the Act means the cases
in which enterprisers enter the aggregate of prices of goods and services in financial statements, etc. as business profits, etc.
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
Article 10 (Where No Turnover Exists, etc.)
The term under the Presidential Decree, where there is no turn-over, or where it is difficult to compute the turnover in the proviso
of Article 6 of the Act means any case falling under any of the following subparagraphs: <Amended by Presidential Decree No. 18356,
Apr. 1, 2004>
1.Where there are no actual results of business because the business has not commenced or has been suspended, etc.;
2.Deleted; and <by Presidential Decree No. 18356, Apr. 1, 2004>
3.Where it is difficult to compute an objective turnover due to a loss or damage, etc. of the materials for turnover computation caused
by disasters, etc.
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
CHAPTER III RESTRICTIONSONCOMBINATIONOFENTERPRISES ANDCONSTRAINTSON ECONOMICPOWER CONCENTRATION
Article 11 (Scope of Person with Special Interest)
The term person determined by the Presidential Decree as having a special interest in the main sentence of Article 7 (1) of the
Act means a company or a person excepting a company, and a person who falls under any of the following subparagraphs:
1.A person who is de facto controlling the company concerned;
2.An interested person having relationship with the same person, except for a person who is separated from him under the provisions
of Article 3-2 (1); and
3.A person who takes part in the combination of enterprises with common interest in controlling management.
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
Article 12 (Standards for Total Value of Assets or Turnover)
(1) The term the total value of assets in the proviso of Article7 (1) and Article 12 (1) of the Act means the total value of assets
disclosed on the balance sheet as of the date of expiration of a business year just before the business year in which the date of
the combination of enterprises falls: Provided, That in case of a company operating banking or insurance services, the total value
of the stockholder s equity or paid-in capital shall be the amount shown on the balance sheet as of the end of a business year just
before the base year, whatever is the greater. <Amended by Presidential Decree No. 16221, Mar. 31, 1999>
(2) In case of paragraph (1), the total value of assets shall be the sum of the total value of assets shown on the balance sheet as
of the end of a business year just before the base year and the increased amount from the total value of assets by issuance of new
shares and bonds, over the business year in which the date of the combination of enterprises falls. <Amended by Presidential Decree
No. 16221, Mar. 31, 1999>
(3) The term turnover in the proviso of Article 7 (1) and Article 12 (1) of the Act means the turnover shown on a profit and loss
statement over the business year just before the business year in which the date of the combination of enterprises falls: Provided,
That in case of a company operating banking or insurance services, turnover shall be referred to as business profits shown on a profit
and loss statement over a business year just before the business year. <Amended by Presidential Decree No. 16221, Mar. 31, 1999>
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
Article 12-2 (Standards for Large Company)
The term company meeting the size as determined by the Presidential Decree in the proviso of Article 7 (1) of the Act means a company
whose total asset amounts or sales are not less than two thousand billion won. <Amended by Presidential Decree No. 16221, Mar.
31, 1999>
[This Article Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997]
Article 12-3 (Exception to Scope of Persons in Special Relation)
The term persons prescribed by the Presidential Decree in Articles 7 (1) 5 (a) and 8-2 (1) 1 of the Act and the latter part of subparagraph
3 of Article 11 of the Act means the persons prescribed in subparagraph 3 of Article11. <Amended by Presidential Decree No. 17564,
Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
[This Article Newly Inserted by Presidential Decree No. 16221, Mar. 31, 1999]
Article 12-4 (Corporate Combination between Inviable Companies)
The term requirements as determined by the Presidential Decree in Article7 (2) 2 of the Act means any case falling under the following
subparagraphs:
1.The case where if no corporate combination takes places, it is hard to continue utilizing the production facilities of companies
in the market; and
2.The case where it is difficult to combine other competitive companies than combined companies concerned.
[This Article Newly Inserted by Presidential Decree No. 16221, Mar. 31, 1999]
Articles 13 and 14 Deleted.
<by Presidential Decree No. 16221, Mar. 31, 1999>
Article 15 (Report on Incorporation and Conversion of Holding Companies)
(1) Any person, who has incorporated a holding company or converted his company into a holding company, shall file with the Fair Trade
Commission an application stating the name of the reporter, titles of the holding company and its subsidiaries and business-related
sub-subsidiaries, total amount of assets, total amount of debts, a roster of stockholders, the current state of stockholdings, details
of the business, etc., attached with documents verifying the contents of the application as prescribed and published by the Fair
Trade Commission within the period falling under the following subparagraphs pursuant to Article 8 of the Act: <Amended by Presidential
Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 18768, Mar. 31, 2005>
1.Where a holding company is incorporated, within 30 days from the day the incorporation of the holding company is registered;
2.Where a company converts into a holding company through a merger with other company or a division of such company, within 30 days
from the day on which the merger of the two companies or the division of the company is registered;
3. Where a company is excluded from the application of Article 8 of the Act pursuant to any other Act, within 30 days from the day
the period of exclusion described in any such other Act passes; and
4.Where a company converts into a holding company through acquisition of other company s stocks, an increase or a decrease in assets,
etc., within four months from the day the relevant business year comes to an end.
(2) Where any person, who makes a report under paragraph (1), falls under the same person in control of a company affiliated with
an enterprise group subject to the limitations on debt guarantees under Article 10-2 (1) of the Act or is in special relation with
the same person, he shall furnish documents showing the outcome of annulling debt-repayment guarantees under each subparagraph of
Article 8-3 of the Act. <Amended by Presidential Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 17564, Mar. 30, 2002>
(3) In making a report on the incorporation of a holding company under paragraph (1), in case the number of incorporators is not less
than two, they shall make a joint report: Provided, That the same shall not apply to the case where one representative chosen from
among incorporators under obligation to do so makes the report.
(4) Where a holding company does not fall under the provisions of Article 2 (1) or (2) any more due to a decrease in stockholdings
and an increase or decrease, etc. in assets during a business year and then reports it to the Fair Trade Commission, the company
shall not be deemed a holding company from the date such reasons take place.
(5) Any company, which has made the report under paragraph (4), shall furnish its balance sheet and current state of stockholdings
audited by a certified public accountant as of the day such reasons take place to the Fair Trade Commission as prescribed by the
Fair Trade Commission. In this case, the Fair Trade Commission shall notify the holding company of the results of examining the report
within 30 days from the day the report is made.
[This Article Wholly Amended by Presidential Decree No. 16221, Mar. 31, 1999]
Article 15-2 (Standards for Venture Holding Company)
The term standards as prescribed by the Presidential Decree in Article 8-2 (1) 2 of the Act means any case where the total amount
of the stock value of a venture business under Article 2 (1) of the Act on Special Measures for the Promotion of Venture Businesses,
which is owned by a holding company, runs in excess of 50/100 of the total amount of the stock value of entire subsidiaries owned
by the relevant holding company.
<Amended by Presidential Decree No. 18768, Mar. 31, 2005>
[This Article Newly Inserted by Presidential Decree No. 17176, Mar. 27, 2001]
Article 15-3 Deleted.
<by Presidential Decree No. 18768, Mar. 31, 2005>
Article 15-4 (Restrictions on Stockholdings of Subsidiaries by Financial Holding Companies)
The term company meeting the standards as determined by the Presidential Decree such as companies closely connected with the financial
business or insurance business in the main sentence of Article 8-2 (2) 4 of the Act means the company established to carry on the
business falling under any of the following subparagraphs: <Amended by Presidential Decree No. 18768, Mar. 31, 2005>
1.The business of rendering services such as electronic data processing to financial or insurance companies;
2.The business of managing real estate or other assets held by financial or insurance companies;
3.The business of conducting surveys and researches on the financial business or the insurance business; and
4.Other business related directly to the inherent business of financial or insurance companies.
[This Article Newly Inserted by Presidential Decree No. 16221, Mar. 31, 1999]
Article 15-5 Deleted.
<by Presidential Decree No. 18768, Mar. 31, 2005>
Article 15-6 (Report on Current State of Stocks Held by Holding Company, etc.)
(1) Any holding company shall file with the Fair Trade Commission a report stating matters falling under any of the following subparagraphs
within four months after the relevant business year comes to an end pursuant to the provisions of Article 8-2 (5) of the Act under
the conditions as prescribed and published by the Fair Trade Commission: <Amended by Presidential Decree No. 17176, Mar. 27, 2001;
Presidential Decree No. 18768, Mar. 31, 2005>
1.Names, locations, incorporation dates, details of the business, names of representatives, etc. of the holding company, its subsidiaries
and business-related sub-subsidiaries (hereinafter referred to as the holding company, etc. );
2.Current stockholders of the holding company, etc.;
3.Current state of stocks held by the holding company, etc.;
4.Financial matters such as paid-in capitals, total capitals, total liabilities and total assets of the holding company, etc.; and
5.Deleted. <by Presidential Decree No. 18768, Mar. 31, 2005>
(2) The report referred to in paragraph (1) shall be accompanied by documents falling under the following subparagraphs: <Amended
by Presidential Decree No. 17564, Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.Financial statements (including combined financial statement in case companies shall compile the combined financial statements under
the Act on External Audit of Stock Companies) such as balance sheets and income statements for the immediately preceding business
year of a holding company, etc. and audit reports compiled by auditors on the financial statements [limited to a company belonging
to an enterprise group subject to the limitations on mutual investment, an enterprise group subject to the limitations on total investment
amount, and an enterprise group subject to the limitations on debt guarantee (hereinafter referred to as the enterprise group subject
to the limitations on mutual investment, etc. ) and a company subject to external audit under the Act on External Audit of Stock
Companies];
2.Rosters of stockholders of the subsidiaries and business-related sub-subsidiaries; and
3.Business reports of the subsidiaries and business-related sub-subsidiaries.
(3) Where the report and accompanying documents submitted under paragraphs (1) and (2) are incomplete, the Fair Trade Commission may
order that such documents be supplemented for a fixed period.
[This Article Newly Inserted by Presidential Decree No. 16221, Mar. 31, 1999]
Article 16 Deleted.
<by Presidential Decree No. 16221, Mar. 31, 1999>
Article 17 (Scope of Enterprise Group Subject to Limitations on Mutual Investment, etc.)
(1) The enterprise group subject to the limitations on mutual investment as prescribed by Article 9 (1) of the Act shall be an enterprise
group whereto belong the domestic companies whose total asset amounts on the balance sheet of the business year immediately before
the designation of them as an enterprise group subject to the limitations on mutual investment (in the case of the companies which
operate a financial business or an insurance business, it shall be the larger amount between the total capital or the capital stock,
and in the case of a newly incorporated company having no balance sheet for the immediately preceding business year, it shall be
the paid-in capital as of the designated date; hereafter the same shall apply in this Article, and Articles 17-8 and 21) is in excess
of two trillion won: Provided, That the following ones shall be excluded: <Amended by Presidential Decree No. 13842, Feb. 20,
1993; Presidential Decree No. 14566, Apr. 1, 1995; Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 15767, Apr.
1, 1998; Presidential Decree No. 16221, Mar. 31, 1999; Presidential Decree No. 16777, Apr. 1, 2000; Presidential Decree No. 17564,
Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.An enterprise group which operates only financial business or insurance business;
2.An enterprise group in which the company operating the financial business or insurance business is the same person as prescribed
by subparagraph 2 of Article 2 of the Act;
3.Deleted; <by Presidential Decree No. 17564, Mar. 30, 2002>
4.Deleted; and <by Presidential Decree No. 17176, Mar. 27, 2001>
5.An enterprise group in which the total sum of gross asset amounts of the companies falling under any of the following items,from
among the companies affiliated with the said group, is in excess of 50/100 of the gross asset amounts of the whole enterprise group:
Provided, That the enterprise group in which the total sum of gross asset amounts of other companies than those falling under any
of the following items is in excess of two trillion won shall be excluded:
(a) A company for which a commencement of reorganization procedures under the Company Reorganization Act has been decided and such
procedures are in progress; and
(b) A company for which a commencement of management procedures under Article 12 (1) 1 through 3-1 of the Corporate Restructuring
Promotion Act has been decided and such procedures are in progress.
(2) The enterprise group subject to the limitations on total investment amount under Article 10 (1) of the Act shall be an enterprise
group whereto belong the domestic companies whose total sum of gross asset amounts on the balance sheet of the business year immediately
before the designation of them as the enterprise group subject to the limitations on total investment amount is not less than six
trillion won: Provided, That the enterprise group falling under any of the following subparagraphs shall be excluded: <Newly Inserted
by Presidential Decree No. 17564, Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.An enterprise group falling under paragraph (1) 1 or 2;
2.An enterprise group in which the total sum of gross asset amounts of the companies falling under paragraph (1) 5 (a) or (b),from
among the companies affiliated with the said group, is in excess of 50/100 of the gross asset amounts of the whole enterprise group:
Provided, That the enterprise group in which the total sum of gross asset amounts of other companies than those falling under paragraph
(1) 5 (a) or (b) is not less than six trillion won shall be excluded;
3.Deleted; <by Presidential Decree No. 18768, Mar. 31, 2005>
4.An enterprise group,from among enterprise groups each of which is controlled by the same person who is a natural person, in which
the rate obtained by deducting the rate of equity shares owned by the same person and relatives of the same person from the rate
of voting equity shares of the same person and persons having relation to the same person calculated pursuant to paragraphs (3) and
(4) as of April 1 of every year is not more than 25/100 and the rate of voting equity shares of the same person and the persons having
relation to the same person is not more than three times the rate of equity shares owned by the same person and the relatives of
the same person; and
5.An enterprise group in which the number of affiliated companies which belong to the enterprise group under the main sentence of
Article 10 (1) of the Act is not more than five and not more than two-stage investments (referring to the cases where a company which
belongs to the enterprise group acquires and owns the stocks of another affiliated company, which in turn acquires and owns the stocks
of a third affiliated company) are made among the companies which belong to the enterprise group.
(3) The rate of equity shares owned by the same person and relatives of the same person referred to in paragraph (2) 4 shall be obtained
by dividing the total sum of amounts calculated by multiplying the rate of equity shares owned by the same person and relatives of
the same person in an enterprise group by its respective affiliated companies [referring to the rate of stocks held by the same person
and the relatives of the same person in the total number of stocks issued by the respective affiliated companies (excluding non-voting
stocks under Articles 369 and 370 of the Commercial Act; hereafter in this Article the same shall apply)] by the total capitals or
paid-in capitals, whichever are the larger, of the respective affiliated companies, by the total capitals or paid-in capitals, whichever
are the larger, of the respective affiliated companies. <Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005>
(4)The rate of voting equity shares of the same person and persons having relation to the same person referred to in paragraph (2)
4 shall be obtained by dividing the total sum of amounts calculated by multiplying the rate of equity shares held by the same person
and persons having relation to the same person by respective affiliated companies (referring to the rate of stocks held by the same
person and persons having relation to the same person in the total number of stocks issued by the respective affiliated companies)
by the total capitals or paid-in capitals, whichever are the larger, of the respective affiliated companies, by the total capitals
or paid-in capitals, whichever are the larger, of the respective affiliated companies. <Newly Inserted by Presidential Decree
No. 18768, Mar. 31, 2005>
(5)The enterprise group subject to the limitations on debt guarantee as prescribed by Article 10-2 (1) of the Act shall be the enterprise
group subject to the limitations on mutual investment as referred to in paragraph (1). <Newly Inserted by Presidential Decree
No. 13842, Feb. 20, 1993; Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 15767, Apr. 1, 1998; Presidential
Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 17564, Mar. 30, 2002>
Article 17-2 (Exception from Limitations on Total Investment Amount and Exemption from Application)
(1)The term industries as prescribed by the Presidential Decree in Article 10 (1) 4 of the Act means the industry falling under
any one of the following subparagraphs: <Newly Inserted by Presidential Decree No. 17564, Mar. 30, 2002; Presidential Decree No.
18768, Mar. 31, 2005; Presidential Decree No. 19023, Aug. 31, 2005>
1.Industry related to the information and communications under subparagraph 3 of Article 2 of the Framework Act on Informatization
Promotion;
2.Industry utilizing a biotechnology under Article 2 of the Biotechnology Support Act;
3.Industry related to a new and renewable energy under Article 2 of the Act on the Promotion of the Development and Use of New and
Renewable Sources of Energy; and
4.Environment industry under subparagraph 3 of Article 2 of the Development of and Support for Environmental Technology Act.
(2) The term requirements prescribed by the Presidential Decree in Article 10 (1) 4 of the Act means the case falling under any
one of the following subparagraphs: <Amended by Presidential Decree No. 17317, Jul. 24, 2001; Presidential Decree No. 17564, Mar.
30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.Where a company invests in kind or transfers the business which has been run by such company for not less than three consecutive
years or its major assets used for the business, in or to another company which runs the same type of business (to be based on the
mid-classification in the Korea Standard Industrial Classification publicly notified by the Commissioner of the National Statistical
Office under Article 17 (1) of the Statistics Act) to acquire or own its stocks: Provided, That where a company invests in kind or
transfers its business in or to a newly incorporated company to acquire or own its stocks, it shall be limited to the cases where
another company which runs the same type of business invests in kind or transfers its business in or to the newly incorporated company;
2.and 3. Deleted; <by Presidential Decree No. 18768, Mar. 31, 2005>
4.Where a company acquires or owns stocks of a newly incorporated company through physical or personal division of the business which
has been run by such company for not less than three consecutive years or major assets used for such business: Provided, That in
the case of personal division, it shall be limited to the cases where a company acquires or owns stocks of a newly incorporated company
within the limit of the rate of its treasury stocks;
5.Where a company invests in kind its business or major assets used for its business in a newly incorporated company satisfying the
standards described in the following items to acquire or own less than 30/ 100 of total stocks issued by such newly incorporated
company:
(a)The aggregate equity shares of officers and employees engaging in the business concerned shall be the largest among the equity
shares owned by investors in the newly incorporated company; and
(b)The newly incorporated company shall not be an affiliate of the same company;
6.Deleted; <by Presidential Decree No. 17564, Mar. 30, 2002>
7.through 7-3.Deleted; <by Presidential Decree No. 18768, Mar. 31, 2005>
8.Deleted; <by Presidential Decree No. 17564, Mar. 30, 2002>
9.Where a small and medium company incorporated pursuant to the Framework Act on Small and Medium Enterprises Act acquires or owns
less than 50/100 of total stocks issued by another small and medium company falling under any one of the following items:
(a)A small and medium company which mainly produces and supplies raw materials, parts, or other materials; and
(b)A venture company incorporated pursuant to the Act on Special Measures for the Promotion of Venture Businesses: Provided, That
where it is converted into other company than a venture company, the above provisions shall be applied only for six months from the
day when such conversion occurs; and
10.Where a company acquires or owns the stocks of the company industrializing a new technology falling under any of the following
items in order to strengthen the international competitiveness of the industry falling under one of each subparagraph of paragraph
(1). In this case, the term industrialization means the case where the ratio occupied in the turnover of relevant company by the
turnover during the latest one year of the products, manufactured by utilizing a new technology falling under one of the following
items, is not less than 30/100 (where a company acquires or owns the stocks of a newly incorporated company which intends to industrialize
a new technology, the newly incorporated company shall be deemed to industrialize the new technology for two years after it is incorporated,
regardless of the ratio occupied in the turnover of the relevant company by the turnover during the latest one year of the products
manufactured by utilizing the new technology described in each item of subparagraph 10):
(a) Excellent new technology of information and communications designated under Article 22 of the Framework Act on Informatization
Promotion;
(b) New technology acknowledged under Article 6 of the Technology Development Promotion Act;
(c) Introduced technology reported under Article 25 (1) of the Foreign Investment Promotion Act;
(d) New environmental technology designated under Article 18 (1) 1 of the Enforcement Decree of the Development of and Support for
Environmental Technology Act;
(e) Technology authenticated under Article 28 (2) 3 of the Enforcement Decree of the Industrial Development Act; and
(f) Technology covered by the comprehensive plans relating to the industries of growth power of next generation under Article 13-2
(4) 1 of the Enforcement Decree of the Framework Act on Science and Technology and recognized by the head of the administrative agency
who has charge of such technology pursuant to related Acts and subordinate statutes.
(3) Where any company belonging to an enterprise group subject to the limitations on total investment amount intends to obtain a recognition
of the acquisition and ownership of stocks described in each subparagraph of paragraph (2) pursuant to the provisions of Article
10 (1) 4 of the Act, it shall submit to the Fair Trade Commission the documents falling under each of the following subparagraphs,
under the conditions as prescribed by the Fair Trade Commission: <Amended by Presidential Decree No. 17564, Mar. 30, 2002>
1.A written application and a document verifying the investment details;
2.In the case of paragraphs (2) 10 and (5) 1 and 2, the evidential documents such as the ratio of turnover or trades, etc., which
are confirmed by a certified public accountant or certified tax accountant; and
3.Other documents verifying the facts of satisfying the requirements.
(4) The term requisites as prescribed by the Presidential Decree in the main sentence of Article 10 (1) 5 of the Act means a case
where a resolution (referring to a decision of intent for changing the articles of incorporation in case where the relevant company
is not a stock company) is passed at a general meeting of stockholders with respect to the conversion to a holding company or the
conversion to a company that is not a holding company. <Newly Inserted by Presidential Decree No. 17176, Mar. 27, 2001>
(5) The term government-invested institution as prescribed by the Presidential Decree in Article 10 (6) 2 (c) of the Act means the
institution falling under any of the following subparagraphs: <Newly Inserted by Presidential Decree No. 17564, Mar. 30, 2002;
Presidential Decree No. 18768, Mar. 31, 2005>
1.The Korea Electric Power Corporation established under the Korea Electric Power Corporation Act; and
2.The Korea District Heating Corporation established under the Integrated Energy Supply Act.
(6) The term company falling under the standards as prescribed by the Presidential Decree in Article 10 (6) 3 of the Act means the
company falling under any of the following subparagraphs: Provided, That where it comes not to meet the requirement under one of
the following subparagraphs, the provisions of Article 10 (6) of the Act shall be applicable only for 6 months from the date on which
it has come not to satisfy the requirement under each subparagraph: <Newly Inserted by Presidential Decree No. 17564, Mar. 30,
2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.A company carrying on the business identical with that carried on by the company subject to the limitations on total investment
amount (hereafter in this paragraph, referred to as the investing company ). In this case, the business carried on by the investing
company and the company issuing the stocks acquired or owned by the investing company (hereafter in this paragraph, referred to as
the invested company ), shall be based on the mid-classification in the Korea Standard Industrial Classification publicly notified
by the Commissioner of National Statistical Office under Article 17 (1) of the Statistics Act, and the standard under each of the
following items:
(a) In the case of an investing company, it shall be based on the business, from among the businesses run by it at the time of investment,
whose ratio occupied in the turnover during the latest 3 business years is in excess of 25/100, but where such business is only one,
the business whose ratio ranks second (limited to the business whose ratio is in excess of 15/100) shall be included, and where there
exists no business, from among the businesses run by it at the time of investment, whose ratio occupied in the turn-over during the
latest 3 business years exceeds 25/100, it shall be based on the business whose ratio is the largest; and
(b) In the case of an invested company, it shall be based on the business, from among the businesses run by it at the time of investment,
whose ratio is the largest, from among the businesses whose ratio occupied in the turnover during the latest 3 business years exceeds
25/100;
2.A company in the relationship falling under any of the following items on the basis of the trade amounts during the latest 3 business
years:
(a) Where an invested company sells the products manufactured by an investing company in excess of 50/100, or the sales of products
manufactured by an investing company are in excess of 50/100 of the entire sales of an invested company;
(b) Where an investing company sells the products manufactured by an invested company in excess of 50/100, or the sales of products
manufactured by an invested company are in excess of 50/100 of the entire sales of an investing company;
(c) Where an invested company maintains, manages or repairs more than 50/100 of the manufactured products or production facilities,
etc. of an investing company, or the ratio of the sales amount of the maintenance, management or repair on the manufactured products
or production facilities, etc. of an investing company to the sales amount of an invested company is in excess of 50/100;
(d) Where an investing company maintains, manages or repairs more than 50/100 of the manufactured products or production facilities,
etc. of an invested company, or the ratio of the sales amount of the maintenance, management or repair on the manufactured products
or production facilities, etc. of an invested company to the sales amount of an investing company is in excess of 50/100;
(e) Where an investing company supplies more than 50/100 of its manufactured products to an invested company for its raw materials
or parts, etc., or the ratio occupied by raw materials or parts, etc. supplied by an investing company in the entire raw materials
or parts, etc. of an invested company is in excess of 50/ 100; and
(f) Where an invested company supplies more than 50/100 of its manufactured products to an investing company for its raw materials
or accessories, etc., or the ratio occupied by raw materials or parts, etc. supplied by an invested company in the entire raw materials
or parts, etc. of an investing company is in excess of 50/100;
3.A company whose principal objectives are the research and development for the product manufacturing of an investing company; and
4.A company falling under any of the following items which are directly related to the business details of an investing company:
(a) A company obviously carrying on as its principal business the kind of business identical with that under subparagraph 1 (a) carried
on by an investing company under its authorized or permitted items or its articles of incorporation, etc.; and
(b) A company supplying such facilities or services that an investing company shall in fact face, without utilizing, a difficulty
in performing its business in the related markets.
(7) The term company corresponding to the criteria prescribed by the Presidential Decree in Article 10 (6) 5 of the Act means the
company for which the turnover for immediately preceding business year of the cooperative business approved under Article 17 of the
Inter-Korea Exchange and Cooperation Act is more than 50/100 of the whole turnover of the immediately preceding business year of
the relevant company: Provided, That in the case of a company for which two years have yet passed after its establishment, it means
the company for which it is apparent that it operates mainly the South-North exchange and cooperation business under the company
s articles and the approved matters, etc. of the South-North exchange and cooperation business. <Newly Inserted by Presidential
Decree No. 18921, Jun. 30, 2005>
[This Article Newly Inserted by Presidential Decree No. 16777, Apr. 1, 2000]
Articles 17-3 and 17-4 Deleted.
<by Presidential Decree No. 15767, Apr. 1, 1998>
Article 17-5 (Requirements for Exemption from Prohibition of Guarantee of Debt Repayments)
(1)The term guarantee made in connection with any obligation of a company, which is taken over in Article 10-2 (1) 1 of the Act
means any of the following cases: <Amended by Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 15767, Apr.
1, 1998; Presidential Decree No. 17176, Mar. 27, 2001>
1.Any guarantee made by a company taking over another company or its affiliated company for any debt of, or expected to be taken over
by, a company transferred by means of transfer of stocks or merger, etc. which is outstanding at the time of the transfer; and
2.Any guarantee made by an affiliated company for any debt taken over in compliance with a divided transfer of debt of the transferred
company.
(2)The term guarantee with respect to debts which is deemed necessary to enhance the international competitiveness of enterprises,
or which is set forth in the Presidential Decree in Article 10-2 (1) 3 of the Act means any one of the following cases: <Amended
by Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 15767, Apr. 1, 1998; Presidential Decree No. 16221, Mar.
31, 1999; Presidential Decree No. 16777, Apr. 1, 2000; Presidential Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 17564,
Mar. 30, 2002; Presidential Decree No. 18736, Mar. 8, 2005; Presidential Decree No. 18768, Mar. 31, 2005>
1.Guarantee for any loan made by the Export-Import Bank of Korea to support funds needed in the process of producing capital goods
and other commodities or providing techniques under Article 18 (1) 1 and 2 of the Export-Import Bank of Korea Act, or any loan made
by other domestic financial institutions in connection with it;
2.Guarantee for any tender bond, contract fulfillment guarantee, advance refund guarantee, reserve repayment guarantee, defect mending
guarantee or tax payment guarantee made by a domestic financial institution in connection with an execution of construction and industrial
facility works outside Korea, building of ships for export, export of services and other export goods recognized by the Fair Trade
Commission;
3.Guarantee for funds assisted by domestic financial institutions for facilities to industrialize new domestic technology or introduced
technology and to develop such technology, and technical development projects, such as purchase of machinery and materials, etc.;
4.Guarantee for purchasing by domestic financial institutions export bills under documents against acceptance or payment terms, and
opening of a local letter of credit;
5.Guarantee of credit extended by overseas branches of domestic banking institutions with regard to such businesses as falling under
any of the following items:
(a) Foreign direct investment pursuant to the provisions of the Foreign Exchange Transactions Act;
(b) Overseas construction or service projects performed by contractors of overseas construction and services; and
(c) Other projects in foreign countries as recognized by the Fair Trade Commission;
6.Guarantee directly involved with the acquirement by a third party of a company which has requested the courts to commence reorganization
procedures of the company in accordance with the Company Reorganization Act;
7.In case that investment is made in an affiliate which runs the private investment business in a manner as prescribed by the provisions
of subparagraphs 1 through 4 of Article 4 of the Act on Private Participation in Infrastructure, guarantee of credits extended to
such affiliate by a domestic financial institution; and
8.Where a company falling under any of Article 10 (6) 2 (a) through (c) is divided for its structural reorganization, the reassurance
rendered by such company to the relevant newly incorporated company, in a direct relation with the takeover by the company, newly
incorporated due to a division, of the assurance by such company rendered to a company other than the affiliates.
[This Article Newly Inserted by Presidential Decree No. 13842, Feb. 20, 1993]
Article 17-6 (Scope of Domestic Financial Institutions)
The term other financial institutions as prescribed by the Presidential Decree in Article 10-2 (2) 6 of the Act means specialized
credit financial companies as prescribed by the Specialized Credit Financial Business Act. <Amended by Presidential Decree No.
17176, Mar. 27, 2001; Presidential Decree No. 18768, Mar. 31, 2005>
[This Article Wholly Amended by Presidential Decree No. 15767, Apr. 1, 1998]
Article 17-7 Deleted.
<by Presidential Decree No. 17176, Mar. 27, 2001>
Article 17-8 (Resolution of Board of Directors and Publication on Large-Scale Internal Trading)
(1) Any enterprise group which is required to call a meeting of the board of directors for a resolution and publication with respect
to a large-scale internal trading in accordance with the provisions of Article 11-2 (1) of the Act shall be an enterprise group subject
to the limitations on mutual investment under Article 17 (1). <Amended by Presidential Decree No. 17176, Mar. 27, 2001; Presidential
Decree No. 17564, Mar. 30, 2002>
(2) Any act of large-scale internal trading subject to a resolution by the board of directors and publication in accordance with the
provisions of Article 11-2 (1) of the Act shall be the act of trading which amounts to not less than 10/100 of the total capital
or paid-in capital, whichever is the larger, of a company concerned or to not less than 10 billion won. <Amended by Presidential
Decree No. 18768, Mar. 31, 2005>
(3) Major contents of the publication made in accordance with the provisions of Article 11-2 (2) of the Act shall be as follows:
1.Objective and object of trading;
2.The counterpart of trading (even if a specially-related person is not directly involved as a counterpart of trading, where such
trading is made for such specially-related person, the specially-related person involved shall be included);
3.Amount and terms of trading;
4.Total trading balance of the same trading pattern with a trading counterpart; and
5.Matters prescribed and published by the Fair Trade Commission, which are corresponding to matters of subparagraphs 1 through 4.
(4) The act of trading which can be performed without going through a resolution by the board of directors in accordance with the
provisions of Article 11-2 (4) of the Act shall be an act of trading meeting requirements falling under the following subparagraphs:
<Amended by Presidential Decree No. 18768, Mar. 31, 2005>
1.An act of trading performed according to standard contractual terms and conditions under the provisions of Article 2 of the Regulation
of Standardized Contracts Act; and
2.An act of trading with the context of normal trading of a company concerned.
[This Article Newly Inserted by Presidential Decree No. 16777, Apr. 1, 2000]
Article 17-9 (Companies Which are Not Subject to Limitations on Total Investment Amount)
(1)The term company that operates the oversight and check mechanism that is prescribed by the Presidential Decree in Article 10
(7) 4 of the Act means such a company as recognized by the Fair Trade Commission as meeting three or more subparagraphs of the following:
1.It shall make it possible to exercise voting rights in writing pursuant to Article 368-3 of the Commercial Act;
2.It shall make it possible to exercise voting rights by means of a concentrated vote pursuant to Article 382-2 of the Commercial
Act;
3.It shall establish a committee under Article 393-2 of the Commercial Act (hereinafter referred to as the internal trading committee
) having authority to examine and approve of a trading the other party of which is a specially-related person (excluding subparagraph
3 of Article 11; hereafter in this subparagraph the same shall apply) or which is performed for a specially-related person (hereinafter
referred to as the internal trading ) and shall have a system under which an internal trading of which the scale of a single or
annual total trading is not less than one billion won (in the case of goods or services, the scale of a single trading shall be at
least 10/100 of the paid-in capital of the company concerned or five billion won) shall be subject to the affirmative votes of a
majority of the registered members of the internal trading committee. In this case, all members of the internal trading committee
shall be composed of outside directors pursuant to Article 2 (19) of the Securities and Exchange Act, the number of whom shall be
at least four; and
4.It shall establish and operate an outside director candidate recommendation committee under Article 54-5 (2) and (3) of the Securities
and Exchange Act, as well as an outside director candidate recommendation advisory group under the said committee to recommend outside
director candidates, separately from the said committee. In this case, all members of the outside director candidate recommendation
committee shall consist of outside directors pursuant to Article 2 (19) of the Securities and Exchange Act, the number of whom shall
be at least four, and all members of the outside director candidate recommendation advisory group shall be made up of persons who
do not belong to the enterprise group concerned, the number of whom shall be at least five.
(2) The Fair Trade Commission may establish and operate an advisory organ to deliberate on the matters of paragraph (1).
[This Article Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005]
Article 17-10 (Publication of Important Matters by Unlisted Companies, etc.)
(1) The term company that belongs to the enterprise group that falls under the standards that are prescribed by the Presidential
Decree in the main sentence of Article 11-3 (1) of the Act means a company that belongs to the enterprise group subject to the limitations
on mutual investment referred to in Article 17 (1): Provided, That this shall exclude a company whose total amount of assets is less
than seven billion won as of the end of the immediately preceding business year and which is under liquidation or has been suspending
its business for not less than one year.
(2) The term matters which are prescribed by the Presidential Decree in Article 11-3 (1) 1 of the Act means those as provided for
in any one of the following subparagraphs:
1.Where the current state and ratio of stocks held by the largest stockholder (where the same person becomes the largest investor
independently or in concert with persons having relation to the same person, including the same person and persons having relation
to the same person) makes a change in 1/100 or more of the total number of stocks issued by the corporation concerned, the changed
matters;
2.The current organization of officers and the changed matters in such organization; and
3.Where the current state and ratio of stocks held by the affiliated companies makes a change in 1/100 or more of the total number
of stocks issued by the corporation concerned, the changed matters.
(3) The term matters which are prescribed by the Presidential Decree in Article 11-3 (1) 2 of the Act means those as provided for
in any one of the following subparagraphs:
1.Where a decision is made with respect to the acquisition or disposal of the fixed assets that account for 10/100 or more of the
total amount of assets as of the end of the latest business year [including the acquisition or disposal of the assets through a trust
contract under the Trust Business Act (limited to the cases where the corporation concerned has the authority to give instructions
as to the management of the assets) or the private offering indirect investment fund under the Act on Business of Operating Indirect
Investment and Assets (limited to the cases where the corporation concerned exercises actual influences upon the operation of assets)],
the decided matters;
2.Where a decision is made with respect to the acquisition or disposal of the stocks and investment certificates of another corporation
(excluding the affiliated companies) that account for 5/100 or more of the equity capital (referring to the total amount of such
acquisition or disposal in the business year concerned, excluding those already reported), the decided matters;
3.Where a decision is made with respect to giving or taking a donation that accounts for 1/100 or more of the equity capital (referring
to the total amount of such donation in the business year concerned, excluding those already reported), the decided matters;
4.Where a decision is made with respect to the offering of a security (referring to the total balance of such security in the business
year concerned, excluding those already reported) or the guarantee of a debt (excluding those for guaranteeing the fulfillment of
a contract, etc. and the payment of a tax, and referring to the total balance of such guarantee in the business year concerned excluding
those already reported) for another person that accounts for 3/100 or more of the equity capital, the decided matters;
5.Where a decision is made with respect to exempting or being exempted from or taking over a debt that accounts for 3/100 or more
of the equity capital, the decided matters;
6.Where a decision is made with respect to the increase or decrease of the capital, the decided matters; and
7.Where a decision is made with respect to the issue of convertible bonds or bonds with warrant, the decided matters.
(4) The term matters which are prescribed by the Presidential Decree in Article 11-3 (1) 3 of the Act means those as provided for
in any one of the following subparagraphs:
1.Where a decision is made pursuant to Articles 374, 522, 527-2, 527-3, and 530-2 of the Commercial Act, the decided matters;
2.Where a decision is made with respect to the all-inclusive swap of stocks pursuant to Article 360-2 of the Commercial Act or the
transfer of stocks pursuant to Article 360-15 of the said Act, the decided matters;
3.Where a cause of dissolution accrues pursuant to Article 517 of the Commercial Act or any other Act, the cause of dissolution;
4.Where a decision is made with respect to the commencement, conclusion, or abolition of company reorganization procedures pursuant
to the Company Reorganization Act, the decided matters;
5.Where a decision is made with respect to the commencement or rescission of composition pursuant to the Composition Act, the decided
matters;
6.Where a decision is made with respect to the commencement, interruption or cancellation of the management procedures pursuant to
Article 12 (1) 1 through 3 of the Corporate Restructuring Promotion Act, the decided matters; and
7.Where a decision is made with respect to the conclusion or termination of a single sale or supply contract which accounts for 10/100
or more of the turnover of the latest business year, the decided matters.
(5) In application of paragraphs (1) through (4), the total amount of assets as of the end of the latest business year, the equity
capital, and the turnover of the latest business year shall be applied for the period from the date when three months pass after
the end of each business year to the date which falls on three months after the end of a business year following each such business
year, and the total amount in the business year concerned and the total balance in the business year concerned shall be calculated
in the aggregate for the period from the date when three months pass after the end of each business year to the date which falls
on three months after the end of a business year following each such business year.
[This Article Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005]
Article 18 (Report, etc. on Combination of Enterprises)
(1)The term any company whose total amount of assets or scale of the sales amount falls under the standards that are set by the Presidential
Decree in the former part of Article 12 (1) of the Act means a company of which the total amount of assets or turnover amounts to
a hundred billion won or more. <Amended by Presidential Decree No. 18768, Mar. 31, 2005>
(2) The term other company whose total amount of assets or scale of the sales amount falls under the standards that are set by the
Presidential Decree in the former part of Article 12 (1) of the Act means a company of which the total amount of assets or turnover
amounts to three billion won or more. <Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005>
(3)Any person who intends to file a report pursuant to the provisions of Article 12 (1) of the Act shall submit to the Fair Trade
Commission the report containing the name of a person responsible for filing such reports, the denomination, turnover, total amount
of assets, contents of businesses of a company taking part in the combination of companies, contents of the combination of companies,
current state of relevant markets, etc., together with relevant documents necessary for verifying the contents of reports under the
conditions as prescribed and published by the Fair Trade Commission. <Amended by Presidential Decree No. 17176, Mar. 27, 2001>
(4)Where it deems a submitted report or documents accompanied therewith in accordance with the provisions of paragraph (3) insufficient,
the Fair Trade Commission may make orders for the supplement of the documents by setting time-limits. In such cases, a period of
time for supplement (including the dates on which orders for supplement have been sent and on which supplemented documents have arrived
at the Fair Trade Commission) shall not be included within the period computed in conformity with Article 12 (7) and (9) of the Act.
<Amended by Presidential Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 18768, Mar. 31, 2005>
(5)The term in case of holding not less than twenty percent (fifteen percent for a stock-listed corporation or Association-registered
corporation) in Article 12 (1) 1 of the Act means the cases in which the ownership of less than twenty percent (fifteen percent
for a stock-listed corporation or Association-registered corporation; hereafter the same shall apply in this paragraph) changes into
that of not less than twenty percent. <Amended by Presidential Decree No. 17176, Mar. 27, 2001>
(6) The term where anyone becomes the largest investor in Article 12 (1) 2 of the Act means the cases in which anyone who is not
the largest investor becomes the largest investor. <Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005>
(7)The term date of combination of enterprises in the main sentences of Article 12 (2) and (6) of the Act means the date of the
following subparagraphs: <Amended by Presidential Decree No. 16221, Mar. 31, 1999; Presidential Decree No. 17176, Mar. 27, 2001;
Presidential Decree No. 18768, Mar. 31, 2005>
1.In the event of holding the stocks of another company or increasing in the ratio of holding another company s stocks, the date stipulated
in each of the following items:
(a) In case of taking over stocks of a joint-stock company, the date stock certificates are issued: Provided, That where stock certificates
are not issued, the date the payment of stocks is made and where voting rights or other rights on stocks are actually transferred
under an agreement or a contract before stock certificates are issued or the payment of stocks is made, the date such rights are
transferred;
(b) In case of purchase of new stocks of a joint-stock company, the date following the date on which the payment of stocks is due;
(c) In case of taking over shares of a company other than a joint-stock company, the date on which transfer of shares takes effect;
and
(d) In case of increasing in the ratio of stockholding due to any other cause than items (a) through (c), such as the reduction of
capital or the retirement of stocks, the date on which the increase in the ratio of stockholding is confirmed;
2.In the event of sharing of directors or officers, the date on which the appointment of such directors or officers is determined
at general meetings of stockholders or employees of a company of which directors or officers are shared;
3.In the event of taking over businesses, the date on which a sum of money for taking over the businesses is paid up: Provided, That
where a sum of money for taking over the businesses is paid up after the expiry of ninety days from the date of conclusion of contracts,
the date on which such days have passed;
4.In the event of merger with other companies, the date on which such merger of companies is registered; and
5.In the event of participation in the establishment of a new company, the date following the date on which the payment of allocated
stocks is due.
(8) The term date which is set by the Presidential Decree in the proviso of Article 12 (6) of the Act means the date as provided
for in any one of the following subparagraphs: <Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005>
1.Where the company concerned comes to hold stocks of any other company or becomes the largest investor of any other company, the
date provided for in any of the following items:
(a)Where it acquires stocks by means of a contract, an agreement, etc. with the holders of the stocks at any other market than the
securities market and KOSDAQ market, the date when such a contract, an agreement, etc. is made; and
(b)Where it acquires stocks in any other manner than the tender offer referred to in the Securities and Exchange Act and item (a),
the date stipulated in each item of paragraph (7) 1;
2.Where the company concerned merges with any other company or takes over the business of any other company, the date when a contract
for the merger or business takeover is concluded; and
3.Where the company concerned participates in the establishment of a new company, the date when a resolution thereon is taken at a
general meeting of stockholders or the board of directors in lieu of such general meeting.
(9)Where there are significant changes in the matters of reports by the date of holding stocks, of registration of the merger of companies,
of takeover of businesses, or of establishment of a company after the date of report, larger companies which have filed reports in
accordance with the provisions of the proviso of Article 12 (6) of the Act shall file reports with regard to such significant changes.
<Amended by Presidential Decree No. 16221, Mar. 31, 1999; Presidential Decree No. 17176, Mar. 27, 2001; Presidential Decree No.
18768, Mar. 31, 2005>
(10)The term as otherwise prescribed by the Presidential Decree in the main sentence of Article 12 (7) of the Act means the case
of paragraph (8) 1 (b). <Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005>
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
Article 19 (Designation, etc. of Representative for Report on Enterprise Combination)
(1)A person who wishes to be designated as an agent in accordance with the proviso of Article 12 (10) of the Act shall submit to the
Fair Trade Commission an application containing the denomination, total amount of assets, turnover, etc. of his company. <Amended
by Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 18768, Mar.
31, 2005>
(2)In the event of the designation of a representative upon the request pursuant to the provisions of paragraph (1), the Fair Trade
Commission shall notify the representative thereof. <Amended by Presidential Decree No. 15328, Mar. 31, 1997>
Article 20 (Report on Current State of Stockholding, etc.)
(1)Any person who wishes to make a report under Article 13 (1) and (2) of the Act, shall submit to the Fair Trade Commission a report
specifying the following matters not later than the end of April in each year: Provided, That where a company comes to belong to
an enterprise group which is newly designated as an enterprise group subject to the limitations on mutual investment, etc., it shall
file reports within thirty days from the date of receipt of such notification pursuant to the provisions of Article 21 (2) in that
year in which such designation is made: <Amended by Presidential Decree No. 13842, Feb. 20, 1993; Presidential Decree No. 15328,
Mar. 31, 1997; Presidential Decree No. 16221, Mar. 31, 1999; Presidential Decree No. 16777, Apr. 1, 2000; Presidential Decree No.
17176, Mar. 27, 2001; Presidential Decree No. 17564, Mar. 30, 2002>
1.Outline of the company, such as the title, capital, total amount of assets, etc. of the company concerned;
2.Number of shares issued by the company concerned, which are held by the affiliated companies and by those who have special relation;
3.The net amount of assets, investment limit amount, and investment gross amount of the company concerned in accordance with the provisions
of Article 10 (1) of the Act; and
4.The amount of debts whose repayments are guaranteed by the company concerned.
(2)The report as referred to in paragraph (1) shall be accompanied by the following documents: <Amended by Presidential Decree
No. 15767, Apr. 1, 1998; Presidential Decree No. 17176, Mar. 27, 2001>
1.Detailed statement of stocks held by the company concerned;
2.Table showing the current status of mutual investment with affiliated companies;
3.Auditing report in the immediately preceding business year of the company concerned;
4.Detailed statement showing the repayments of debts guaranteed by the company for its affiliates and details of changes in the guarantee
of repayments of debts for the immediately preceding year;
5.Detailed statement showing the repayments of debts guaranteed by its affiliates for the company concerned and details of changes
in the guarantee of repayments of debts for the immediately preceding year; and
6.A written statement of confirmation prepared by a domestic financial institution according to the form prescribed by the Fair Trade
Commission under Article 10-2 (2) of the Act for the purpose of confirming the contents of subparagraphs 4 and 5, and paragraph (1)
4.
(3)A company belonging to an enterprise group subject to the limitations on mutual investment, etc. in accordance with the provisions
of Article 13 (1) of the Act shall, where any change takes place to the company following the acquisition of stocks, etc., file a
report stating the contents of such change with the Fair Trade Commission within 30 days from the date of change. <Amended by
Presidential Decree No. 16777, Apr. 1, 2000; Presidential Decree No. 17564, Mar. 30, 2002>
Article 20-2 Deleted.
<by Presidential Decree No. 17176, Mar. 27, 2001>
Article 21 (Designation of Enterprise Group Subject to Limitations on Mutual Investment, etc.)
(1)The Fair Trade Commission shall designate by April 1 (where deemed unavoidable, by April 15) of every year any enterprise group
which meets the criteria as provided for in Article 17, as an enterprise group subject to the limitations on mutual investment under
Article 14 (1) of the Act or if an enterprise group designated as an enterprise group subject to the limitations on mutual investment
becomes nonconforming to such criteria, it shall be excluded from the designation as an enterprise group subject to the limitations
on mutual investment. <Amended by Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 15767, Apr. 1, 1998; Presidential
Decree No. 16777, Apr. 1, 2000; Presidential Decree No. 17564, Mar. 30, 2002>
(2)In cases where the Fair Trade Commission designates any enterprise group as an enterprise group subject to the limitations on mutual
investment or excludes it from such designation under paragraph (1), it shall notify in writing without delay the companies belonging
to an enterprise group subject to the limitations on mutual investment and the same person actually dominating the details of the
business of companies belonging to an enterprise group subject to the limitations on mutual investment under subparagraph 2 of Article
2 of the Act. <Amended by Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 16777, Apr. 1, 2000; Presidential
Decree No. 17564, Mar. 30, 2002>
(3) If there is any change in the company belonging to an enterprise group subject to the limitations on mutual investment after the
designation and notification as referred to in paragraphs (1) and (2) has been made, the Fair Trade Commission shall notify in writing
once each month the same person and the company concerned. <Newly Inserted by Presidential Decree No. 13842, Feb. 20, 1993; Presidential
Decree No. 17564, Mar. 30, 2002>
(4) The term amount that is set by the Presidential Decree in Article 14 (5) of the Act means seven billion won. <Newly Inserted
by Presidential Decree No. 18768, Mar. 31, 2005>
(5) The term date on which the Presidential Decree may determine in Article14-3 of the Act means the date falling under any of the
following subparagraphs: <Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997; Presidential Decree No. 16221, Mar.
31, 1999; Presidential Decree No. 17564, Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.In cases where a company should have been incorporated into an enterprise group subject to the limitations on mutual investment
and notified as an affiliated company of an enterprise group subject to the limitations on mutual investment at the time of designation
of an enterprise group subject to the limitations on mutual investment, the date of designation and notification of an enterprise
group subject to the limitations on mutual investment; and
2.In cases where a company should have been incorporated into an enterprise group subject to the limitations on mutual investment
and notified as an affiliated company of an enterprise group subject to the limitations on mutual investment after the designation
of an enterprise group subject to the limitations on mutual investment, the first day of the following month of the month in which
there occur the grounds on which the company shall be included in an enterprise group subject to the limitations on mutual investment.
(6) The provisions of paragraphs (1) through (5) shall apply mutatis mutandis to the designation and notification of an enterprise
group subject to the limitations on total investment amount and an enterprise group subject to the limitations on debt guarantee
as prescribed by Article 14 (1) of the Act. In this case, the term enterprise group subject to the limitations on mutual investment
shall be considered as enterprise group subject to the limitations on total investment amount or enterprise group subject to
the limitations on debt guarantee . <Amended by Presidential Decree No. 17564, Mar. 30, 2002; Presidential Decree No. 18768, Mar.
31, 2005>
(7) Where an enterprise group designated as an enterprise group subject to the limitations on mutual investment under paragraph (1)
or designated as an enterprise group subject to the limitations on debt guarantee under paragraph (6) falls under any of the following
subparagraphs, it may be excluded from an enterprise group subject to the limitations on mutual investment or an enterprise group
subject to the limitations on debt guarantee when the cause therefor occurs: <Amended by Presidential Decree No. 17564, Mar. 30,
2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.Where the total sum ofgross asset amounts (referring to the gross asset amount on the balance sheet as of the closing date of the
business year immediately before the designation date; hereafter in this Article the same shall apply) of companies falling under
Article 17 (1) 5 (a) or (b) from among those coming to belong to the relevant enterprise group after the designation date, becomes
in excess of 50/100 of gross asset amounts of the whole enterprise group: Provided, That the enterprise group in which the total
sum of gross asset amounts of the companies except for those falling under Article 17 (1) 5 (a) or (b) is in excess of 1.4 trillion
won, shall be excluded; and
2.Where the total sum of gross asset amounts of domestic companies belonging to the relevant enterprise group is decreased to less
than 1.4 trillion won due to a change of its affiliated companies.
(8) Where an enterprise group designated as an enterprise group subject to the limitations on total investment amount under paragraphs
(1) and (6) falls under any of the following subparagraphs, it may be excluded from an enterprise group subject to the limitations
on total investment amount when the cause therefor occurs: <Newly Inserted by Presidential Decree No. 17564, Mar. 30, 2002; Presidential
Decree No. 18768, Mar. 31, 2005>
1.Where the total sum ofgross asset amounts of companies falling under Article 17 (1) 5 (a) or (b), from among those coming to belong
to the relevant enterprise group after the designation date, becomes in excess of 50/ 100 of gross asset amounts of the whole enterprise
group: Provided, That the enterprise group in which the total sum of gross asset amounts of the companies except for those falling
under Article 17 (1) 5 (a) or (b) is in excess of 4.2 trillion won, shall be excluded;
2.Where the total sum ofgross asset amounts of domestic companies affiliated with the relevant enterprise group is decreased to less
than 4.2 trillion won due to a change of its affiliated companies;
3.Deleted; and <by Presidential Decree No. 18768, Mar. 31, 2005>
4. Where the relevant enterprise group comes to fall under Article 17 (2) 5 after the designation date.
Article 21-2 (Scope of Competent Authorities)
The term other institutions set forth in the Presidential Decree in subparagraph 4 of Article 14-4 of the Act means an institution
engaged in services of changing names of shares registered in the records of a corporation on behalf of customers in conformity with
the Securities and Exchange Act, and credit information collection agency pursuant to the provisions of subparagraph 5 of Article
2 of the Use and Protection of Credit Information Act. <Amended by Presidential Decree No. 16221, Mar. 31, 1999; Presidential
Decree No. 18768, Mar. 31, 2005>
[This Article Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997]
Article 21-3 (Categories of and Standards for Unlawful Practices)
(1) Unlawful practices prohibited by the provisions of Article 15 (1) of the Act means practices falling under any of the following
subparagraphs: <Amended by Presidential Decree No. 16221, Mar. 31, 1999; Presidential Decree No. 16777, Apr. 1, 2000; Presidential
Decree No. 17176, Mar. 27, 2001; Presidential Decree No. 17564, Mar. 30, 2002; Presidential Decree No. 18768, Mar. 31, 2005>
1.Deleted; <by Presidential Decree No. 18768, Mar. 31, 2005>
2.Practices which are performed by a company belonging to an enterprise group subject to the limitations on debt guarantee under the
provisions of Article 10-2 (1) of the Act and which fall under any of the following items:
(a)Practices of running debts of the same contents without releasing its affiliates from their existing debts to domestic financial
institutions in accordance with the provisions of Article 10-2 (2) of the Act; and
(b)Practices of making debt guarantee for another company and its affiliates against debt guarantee for the affiliates of its own
by the other company; and
3.Other like or similar practices as falling under subparagraph 2, which are determined and notified by the Fair Trade Commission.
(2)Deleted. <by Presidential Decree No. 18768, Mar. 31, 2005>
[This Article Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997]
Article 22 Deleted.
<by Presidential Decree No. 16221, Mar. 31, 1999>
Article 23 Deleted.
<by Presidential Decree No. 18768, Mar. 31, 2005>
Article 23-2 (Scope of Standard Balance Sheet)
The term balance sheet that is prescribed by the Presidential Decree in Article 17 (4) 1 of the Act means the balance sheet that
includes a first violation of Article 8-2 (2) through (4) of the Act: Provided, That where the fact of such a violation is not included
in the balance sheet because the act of the violation (excluding any violation of Article 8-2 (2) 1 of the Act) is corrected before
the balance sheet is drawn up, the standard balance sheet shall be the balance sheet that is prepared on the basis of the date of
the violation.
[This Article Newly Inserted by Presidential Decree No. 18768, Mar. 31, 2005]
Article 23-3 (Special Case of Corrective Measures, etc.)
(1) For the purpose of Article 17-2 (2) of the Act, the term period as prescribed by the Presidential Decree means 10 days.
(2) The Financial Supervisory Commission shall, when it intends to decide the details of stocks incapable of exercising voting right
under Article 17-2 (3) of the Act, decide on them with the stocks recently acquired or owned: Provided, That such stocks shall be
excluded as those acquired or owned in excess of the amount deemed to be the investment limit amount under Article 14 (3) 2 of the
Act after the date of designation or affiliation, and those acquired or owned after the date on which one year elapsed from the date
of designation or affiliation.
(3) A company subjected to an order to prohibit an exercise of voting right under Article 17-2 (1) of the Act (hereinafter referred
to as the subject company ) shall publicly announce matters falling under any of the following subparagraphs within 5 days from
the date on which it notifies the Fair Trade Commission of the details of stocks subject to an order to prohibit an exercise of voting
right under Article 17-2 (2) of the Act, or from the date on which it receives a notice of details of stocks incapable of exercising
a voting right from the Fair Trade Commission under Article 17-2 (3) of the Act:
1.A company issuing the stocks subjected to a restriction on voting right; and
2.Total number of stocks acquired or owned by the subject company and the number of stocks subjected to a restriction on voting right,
from among the stocks issued by the issuing company under subparagraph 1.
(4) The subject company shall, where it has made a public announcement under paragraph (3), notify the Fair Trade Commission of such
fact within 3 days.
(5) The subject company shall, where any changes have occurred in the details of stocks incapable of exercising voting right due to
the causes that it has disposed of the stocks acquired or owned after a public announcement under paragraph (3) or that the net asset
of such company has been increased, etc., notify the Fair Trade Commission of the causes and details of such changes, etc. within
10 days from the date of occurrence of such causes for changes, and publicly announce the causes and details of such changes within
5 days from the date of notification to the Fair Trade Commission. In this case, in deciding on the stocks to be changed, such decision
shall be made within the scope of stocks publicly announced immediately earlier, from among those publicly announced under paragraph
(3) or the former part of this paragraph.
(6) The Fair Trade Commission may entrust the agencies accepting the reports under Article 186 of the Securities and Exchange Act
with the affairs related to public announcement under paragraph (3). In this case, the method and procedure for public announcement
and other necessary matters shall be determined by the Fair Trade Commission by going through a consultation with the agencies accepting
the reports which has been entrusted with the affairs related to public announcement. <Amended by Presidential Decree No. 18768,
Mar. 31, 2005>
[This Article Newly Inserted by Presidential Decree No. 17564, Mar. 30, 2002]
Article 23-4 (Imposition and Collection, etc. of Compulsory Performance Money, etc.)
(1) The Fair Trade Commission shall, when it imposes a compulsory performance money pursuant to Article 17-3 of the Act, impose it
for a period ranging from the date following the closing date of a period set in corrective measures to the date the corrective measures
are implemented. In this case, a compulsory performance money shall be imposed within 30 days from the date the period set in the
corrective measures comes to an end except the case where special reasons exist that prevent the imposition. <Amended by Presidential
Decree No. 17564, Mar. 30, 2002>
(2) In deciding on the date the corrective measures referred to in paragraph (1) are implemented, in case contents of the corrective
measures are for the disposal of stocks, it shall be the date stock certificates are issued, for the resignation of an executive,
it shall be the date his resignation as an executive is registered and for the transfer of the business, it shall be the date the
transfer of the ownership of the related real estate is registered.
(3) Notwithstanding the provisions of paragraph (1), the Fair Trade Commission, when it imposes a compulsory performance money on
a person who has failed to implement the corrective measures referred to in Article 16 (1) 7 and 8 of the Act, which contain a certain
obligation by the period such as each quarter and each business year, shall impose it according to a period for which the corrective
measures are not implemented. The compulsory performance money shall be imposed within 30 days from the date it is confirmed that
the corrective measures are not implemented.
(4) In deciding on the amount of the compulsory performance money, the Fair Trade Commission shall take into account reasons for failing
to implement the corrective measures and the size of profits a person is able to earn from not implementing the corrective measures.
(5) The Fair Trade Commission shall, when it imposes a compulsory performance money, notify in writing, expressly indicating the per
diem amount of a compulsory performance money (referring to the amount set according to a period for which the corrective measures
are not implemented in the case of the compulsory performance money referred to in paragraph (3)), reasons for the imposition, a
deadline for paying the compulsory performance money, a receipt agency, methods of raising an objection and a period for which the
objection is raised.
(6) Any person, upon receiving a notification made under paragraph (5). shall pay a compulsory performance money within a deadline
set according to each of the following subparagraphs: Provided, That where he is unable to pay the compulsory performance money within
a deadline due to natural disasters or other unavoidable reasons, he shall pay it within 30 days from the date such reasons cease
to exist:
1.In the case of the compulsory performance money referred to in paragraph (1), within 30 days from the date the Fair Trade Commission
sets the amount of the compulsory performance money and then notifies its payment after confirming the date the act of implementing
the corrective measures is completed; and
2.In the case of a compulsory performance money referred to in paragraph (3), within 30 days from the date the Fair Trade Commission
notifies the payment of the money.
(7) In collecting the compulsory performance money referred to in paragraph (1), the Fair Trade Commission, in case any corrective
measures are not implemented after the elapse of 90 days from the date the period set in the corrective measures comes to an end,
may collect the compulsory performance money on the basis of the date 90 days elapse every time reckoning from the date the period
comes to an end.
(8) The provisions of Articles 64 and 64-2 shall apply mutatis mutandis to demands for the payment of compulsory performance money
and the entrustment of dispositions taken to collect the compulsory performance money in arrears, respectively.
[This Article Newly Inserted by Presidential Decree No. 16221, Mar. 31, 1999]
Article 23-5 (Standards for Designating Stocks for Which Exercise of Voting Rights is Banned)
The Fair Trade Commission shall, where it intends to designate stocks for which no voting rights can be exercised in accordance with
the provisions of Article 18 (4) of the Act, designate such stocks according to the order of the following subparagraphs:
1.Stocks newly acquired or owned in excess of the investment limit amount as prescribed in the provisions of Article 10 (1) of the
Act; and
2.Stocks recently acquired or owned.
[This Article Newly Inserted by Presidential Decree No. 16777, Apr. 1, 2000]
CHAPTER IV RESTRICTIONONUNFAIR COLLABORATIVE ACTS
Article 24 (Requirements for Approval of Collaborative Acts)
Reference in the text of Article 19 (2) of the Act to requirements as provided for in the Presidential Decree shall be construed
to include requirements as prescribed in the provisions of Articles 24-2 through 28.
[This Article Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997]
Article 24-2 (Requirements for Collaborative Acts for Industrial Rationalization)
The authorization of a collaborative act for the industrial rationalization as prescribed in Article 19 (2) 1 of the Act may be granted
only when the collaborative act satisfies the following requirements: <Amended by Presidential Decree No. 15328, Mar. 31, 1997;
Presidential Decree No. 17564, Mar. 30, 2002>
1.Where the effect of technical advancement, quality improvement, cost curtailment, efficiency promotion, etc. by the collaborative
act is obvious;
2.Where it is difficult to attain the industrial rationalization through any way other than the collaborative act; and
3.Where the effect of industrial rationalization is greater than that of the restriction on competition.
Article 24-3 (Requirements for Collaborative Act for Research and Technical Development)
Any authorization of a collaborative act for research and technical development as prescribed in Article 19 (2) 2 of the Act shall
be granted only when it conforms to the following requirements: <Amended by Presidential Decree No. 15328, Mar. 31, 1997; Presidential
Decree No. 17564, Mar. 30, 2002>
1.Where such research and technical development is requisite for the reinforcement of industrial competitiveness, and might give a
far-reaching effect on the economy;
2.Where the investment needed for such research and technical development is so excessive that a single enterpriser will have difficulty
procuring it;
3.Where it is required for diversification of risks due to the uncertainty of the result of such research and technical development;
and
4.Where the effect of such research and technical development is greater than that of the restriction on competition.
[This Article Newly Inserted by Presidential Decree No. 13842, Feb. 20, 1993]
Article 25 (Requirements for Collaborative Acts to Overcome Depression)
The authorization of any collaborative act to overcome the depression under the proviso of Article 19 (2) 3 of the Act, may be granted
only when the collaborative act meets the following requirements: <Amended by Presidential Decree No. 15328, Mar. 31, 1997>
1.Where the demand for specified goods or services continues to be reduced for a considerable period, and the supply exceeds considerably
the demand, and where such state is obviously going to continue in the future;
2.Where the market price of the goods or services remains below the average production costs for a considerable period;
3.Where a considerable number of enterprises in the business field might find it difficult to continue business activities due to
the depression; and
4.Where matters as referred to in subparagraphs 1 through 3 are unable to be overcome through a rationalization of enterprise.
Article 26 (Requirements for Collaborative Acts to Adjust Industrial Structure)
The authorization of any collaborative act to adjust the industrial structure under the proviso of Article 19 (2) 4 of the Act shall
be granted only when the collaborative act meets the following requirements: <Amended by Presidential Decree No. 15328, Mar. 31,
1997; Presidential Decree No. 17564, Mar. 30, 2002>
1.Where the supply capability of any specified industry is remarkably in an excessive state due to changes in economic conditions
at home and abroad, or where the production efficiency or international competitiveness shows a noticeable drop due to falling behind
of the equipment and methods of the production;
2.Where matters as referred to in subparagraph 1 are unable to be overcome by the rationalization of enterprises; and
3.Where the effect obtained by the adjustment of the industrial structure is greater than that obtained by the restriction on competition.
Article 27 (Requirements for Approval of Collaborative Acts for Modernization of Trading Conditions)
Approval of collaborative acts for modernization of trading conditions under the provisions of Article 19 (2) 5 of the Act shall be
made only where the collaborative act satisfies the following requirements: <Amended by Presidential Decree No. 17564, Mar. 30,
2002>
1.Where modernization of trading conditions contributes significantly to improving productivity, facilitating transactions, and enhancing
conveniences or interests of the consumer;
2.Where the contents of modernization of trading conditions are accessible, in technical or economic terms, to most undertakers in
the trade; or
3.Where the effect of modernization of trading conditions is greater than that of the restriction on competition.
[This Article Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997]
Article 28 (Requirements for Collaborative Acts to Improve Competitiveness of Small and Medium Enterprises)
The authorization of any collaborative act to improve the competitiveness of the small and medium enterprises under the provision
of Article 19 (2) 6 of the Act may be granted only when the collaborative act meets the following requirements: <Amended by Presidential
Decree No. 15328, Mar. 31, 1997>
1.Where the effect of the collaborative act on the improvement of productivity, such as improvement of the quality, know-how, etc.
of the small and medium enterprises, or the strengthening of the bargaining power on the trading conditions, is obvious;
2.Where all the participating businessmen are the small and medium enterprisers; and
3.Where it is difficult to compete efficiently with, or oppose large enterprises by means other than any collaborative act.
Article 29 (Limit on Authorization of Collaborative Acts)
Notwithstanding the provisions of Articles 24-2 through 28, if a collaborative act falls under any of the following subparagraphs,
the Fair Trade Commission may not authorize it: <Amended by Presidential Decree No. 15328, Mar. 31, 1997>
1.Where it might exceed the degree necessary for achieving its objective;
2.Where it might unfairly infringe the interests of consumers and related enterprisers;
3.Where any unfair discrimination exists in contents of the collaborative act among enterprisers participating in it; and
4.Where the participation in or withdrawal from the collaborative act is restricted unfairly.
Article 30 (Request, etc. for Authorization of Collaborative Acts)
(1) Any person who wishes to obtain an authorization of any collaborative act under the provision of Article 19 (2) of the Act, shall
submit to the Fair Trade Commission a request specifying the following matters: <Amended by Presidential Decree No. 15328, Mar.
31, 1997>
1.Number of participating enterprisers;
2.Names of participating enterprisers and seats of business places;
3.Addresses and names of the representative and officers;
4.Reason why he wishes to act jointly and particulars thereof;
5.Period in which he wishes to act jointly; and
6.Details of businesses conducted by the participating enterpriser.
(2) The following documents shall be attached to the request as referred to in paragraph (1): <Amended by Presidential Decree No.
15328, Mar. 31, 1997>
1.Summary of Business Achievement, balance sheet and statement of profit and loss of the participating enterpriser for the most recent
two years;
2.Copy of the agreement or resolution of the collaborative act;
3.Documents attesting that the collaborative act conforms to the requirements for authorization; and
4.Documents attesting that the collaborative act is corresponding to the provisions of Article 29.
(3) In cases where the Fair Trade Commission receives a request as referred to in paragraph (1) and authorizes it, the Commission
shall deliver a certificate of authorization to the requesting person.
(4) If a person who obtained the authorization of the collaborative act wishes to modify authorized matters, he shall request such
modification to the Fair Trade Commission with the documents as referred to in paragraphs (1) and (2), which are related to modified
matters accompanied by the certificate of authorization.
(5) Where it receives a request for approval pursuant to the provisions of Article 19 (2) of the Act, the Fair Trade Commission shall
make a determination, within thirty days [in the case of notification pursuant to the provisions of Article 31 (Notification of Subjects
of Request for Approval of Collaborative Acts), the period computed by aggregating thirty days and the period of notification] after
receipt of such request, as to whether or not to grant approval. <Newly Inserted by Presidential Decree No. 15328, Mar. 31, 1997>
Article 31 (Public Notice on Details of Request for Authorization of Collaborative Acts)
(1) The Fair Trade Commission, where it deems necessary, may invite interested persons to present their views prior to the granting
of approval in accordance with the provisions of Article 19 (2) of the Act by giving public notice with regard to the subjects of
the request. This paragraph shall also apply to changes in subjects of approval. <Newly Inserted by Presidential Decree No. 15328,
Mar. 31, 1997>
(2) If particulars of a request for authorization or modification of a collaborative act are notified publicly by the Fair Trade Commission
under Article 20 (2) of the Act, the particulars of public notice shall include the following matters: <Amended by Presidential
Decree No. 15328, Mar. 31, 1997>
1.Name and address of the requesting enterpriser;
2.Details of the collaborative act;
3.Reason why it wishes to act jointly;
4.Period in which it wishes to act jointly; and
5.In case of a request for modification, the modified matters in the particulars of the initial authorization and the reason thereof.
(3) In making the public notice as referred to in paragraph (1), the period of such notice shall be made within thirty days. <Newly
Inserted by Presidential Decree No. 15328, Mar. 31, 1997>
(4) Any interested person who has any opinion on the details of the public notice as referred to in paragraph (2), may submit to the
Fair Trade Commission a written opinion specifying the following matters within the period of public notice: <Amended by Presidential
Decree No. 15328, Mar. 31, 1997>
1.Name or title and address of the person stating the opinion;
2.Contents of opinion and the reason for presenting such opinion; and
3.Other matters necessary for stating the opinion.
Article 32 (Discontinuation of Permitted Collaborative Acts)
Where an enterpriser, who has been permitted to perform collaborative acts under Article 19 (2) of the Act, discontinues the collaborative
acts, he shall promptly report it to the Fair Trade Commission.
[This Article Wholly Amended by Presidential Decree No. 16221, Mar. 31, 1999]
Article 33 Deleted.
<by Presidential Decree No. 16221, Mar. 31, 1999>
Article 34 Deleted.
<by Presidential Decree No. 14566, Apr. 1, 1995>
Article 35 (Standards for Mitigation or Exemption for Persons, etc. Who have Reported)
(1) The standards for mitigating or exempting the collective measures or surcharge under Article 22-2 (2) of the Act shall be as follows:
1.Where a person makes a report to the Fair Trade Commission before its investigation is commenced and falls under all of the following
items, the surcharge and collective measures shall be exempted:
(a)He is required to be the first person to provide independently evidence necessary to substantiate an unfair collaborative act;
(b)He is required to report the unfair collaborative act under circumstances that the Fair Trade Commission fails to obtain information
on the unfair collaborative act or fails to fully secure evidence necessary to substantiate the unfair collaborative act;
(c)He is required to cooperate in an investigation of the unfair collaborative act, such as stating all facts related to such collaborative
act and submitting the relevant materials, until such investigation is completed; and
(d) He is required to suspend the commission of the unfair collaborative act;
2.Where a person makes a report to the Fair Trade Commission before its investigation is commenced and falls under all of the following
items, the surcharge may be reduced by 30/100 and the collective measures may be mitigated:
(a)He is required to be the second person to provide independently evidence necessary to substantiate an unfair collaborative act;
(b) He is required to cooperate in an investigation of the unfair collaborative act, such as stating all facts related to such collaborative
act and submitting the relevant materials, until such investigation is completed; and
(c) He is required to suspend the commission of the unfair collaborative act;
3.Where a person cooperates in an investigation of an unfair collaborative act after the Fair Trade Commission commences such an investigation
and falls under all of the following items, the surcharge shall be exempted and the collective measures shall be mitigated or exempted:
(a)He is required to be the first person to provide independently evidence necessary to substantiate the unfair collaborative act;
(b)He is required to cooperate in an investigation of the unfair collaborative act under circumstances that the Fair Trade Commission
fails to obtain information on the unfair collaborative act or fails to fully secure evidence necessary to substantiate the unfair
collaborative act;
(c)He is required to cooperate in an investigation of the unfair collaborative act, such as stating all facts related to such collaborative
act and submitting the relevant materials, until such investigation is completed; and
(d) He is required to suspend the commission of the unfair collaborative act;
4.Where a person cooperates in an investigation of an unfair collaborative act after the Fair Trade Commission commences such an investigation
and falls under all of the following items, the surcharge may be reduced by 30/100 and the collective measures may be mitigated:
(a)He is required to be the second person to provide independently evidence necessary to substantiate the unfair collaborative act;
(b) He is required to cooperate in an investigation of the unfair collaborative act, such as stating all facts related to such collaborative
act and submitting the relevant materials, until such investigation is completed; and
(c) He is required to suspend the commission of the unfair collaborative act; and
5.Where a person who is already subjected to a surcharge or collective measures due to an unfair collaborative act meets the requirements
described in the items of subparagraph 1 or 3 with respect to any other unfair collaborative act in which he is involved, the surcharge
may be reduced or exempted and the collective measures mitigated, against such other unfair collaborative act.
(2) A public official making an investigation of an unfair collaborative actshall be prohibited from divulging the identity of a person
who makes a report thereon or cooperates in the investigation concerned, the contents of reported or provided information, etc. or
from providing another person with them, without obtaining any prior consent from the said person.
(3) Matters relating to the extent of concrete mitigation and exemption for reporters, etc., the detailed procedures of operating
the mitigation and exemption system, the methods of providing relevant evidence, etc. shall be determined and published by the Fair
Trade Commission.
[This Article Wholly Amended by Presidential Decree No. 18768, Mar. 31, 2005]
CHAPTER V PROHIBITIONOFUNFAIR TRADE PRACTICES
Article 36 (Designation of Unfair Trade Practices)
(1) Categories or standards of unfair trade practices in accordance with the provisions of Article 23 (2) of the Act shall be as set
out in the attached Table 1. <Amended by Presidential Decree No. 16221, Mar. 31, 1999>
(2) The Fair Trade Commission may, where it deems necessary, determine and notify details for the application of categories or standards
of unfair trade practices pursuant to the provisions of paragraph (1) to a specified area or practice. In such cases, the Fair Trade
Commission shall seek in advance views from the head of the competent administrative agency.
[This Article Wholly Amended by Presidential Decree No. 15328, Mar. 31, 1997]
Article 37 (Fair Competition Code)
(1) If the Fair Trade Commission receives a request for review on a fair competition code under Article 23 (5) of the Act, it shall
notify the requesting person of the result of the review within sixty days after it receives the request for review. <Amended
by Presidential Decree No. 15328, Mar. 31, 1997>
(2) Deleted. <by Presidential Decree No. 16221, Mar. 31, 1999>
Article 38 Deleted.
<by Presidential Decree No. 16221, Mar. 31, 1999>
Article 38-2 Deleted.
<by Presidential Decree No. 15