In response to a civic group’s claim that the amendment to the Venture Business Act, which allows multiple voting rights for unlisted venture companies, is an anti-reform bill, the Venture Business Association said, “It is a bill that is absolutely necessary to advance into the global market.”
The Venture Business Association (hereinafter referred to as the Venture Business Association) issued a statement on the 18th and said, “We would like to ask why the support system for creating a business environment in line with global standards and growing into a unicorn company is an anti-reform law.”
Ben Kihyup said, “I am concerned about whether restricting corporate management through past laws and regulations and hindering innovative growth due to concerns about family situations is truly a necessary action for the development of the Republic of Korea,” and added, “It is argued that this system is being abused as a means of succession for large conglomerates.” “is different from the facts,” he refuted. The association explains that the issuance of multiple voting rights stocks is limited to founders of unlisted venture companies and can be immediately converted to common stock in the event of inheritance, transfer, resignation of directors, incorporation into a large corporate group, or listing (3-year grace period), thereby preventing misuse.
He also said, “Companies founded by second- and third-generation chaebols are included in the conglomerate group and cannot become venture companies, so it is impossible to use the multiple voting stock system limited to venture companies.” He added, “The problem of applying the multiple voting stock system to listed companies or large conglomerates is “Long-term discussion and social consensus must be a prerequisite,” he added.
The Commercial Act already provides a number of exceptions to the one-share-one-vote principle, such as the 3% rule for major shareholders and non-voting stocks, and the Benki Association emphasized that setting voting rights differently depending on policy goals does not undermine the one-share, one-vote principle. The association said, “Most countries that have introduced a multiple voting right system, such as the United States, Japan, China, and Singapore, allow multiple voting rights shares under the principle of one vote per share.”
At the same time, he said, “Continued legislative reform and support are needed, such as improving various regulations so that domestic venture companies are not at a disadvantage in the global economy and boldly eliminating Galapagos regulations that exist only in Korea,” adding, “Stop wasteful debate and ensure that the system is well established in the field.” “More attention is needed to help venture companies grow.”