Government and Big Business Agree to Grace Period on Reform
The Samsung Group and four other conglomerates will be allowed to make investments in other domestic companies, including its units, freely until April 2006 as the nation's anti-trust regulator on Monday decided to offer five groups a one-year grace period from its shareholding limit restriction.
The other four groups to enjoy the grace period are Lotte, POSCO, the Korea Electric Power Corp. and the Korea Highway Corporation.
The present rule bans conglomerates with more than 5 trillion won in assets from investing more than 25 percent of their net assets in other firms, including their affiliates.
The decision was made between the Fair Trade Commission (FTC) and the ruling Uri Party before the enforcement of the revised Monopoly Regulation and Fair Trade Act (MRFTA) from April 1.
Under the eased rule, three business groups _ Shinsegye, Daewoo Engineering & Construction and LG Cable _ are expected to be excluded from the shareholding limit restriction.
Considering the one-year grace period and the hike in asset threshold, the FTC said 10 conglomerates, including LG, Hyundai Motor, KT and SK, are expected to be subject to the shareholding restriction this year after the enforcement of the revised act.
The six other conglomerates are Hanwha, Kumho Asiana, Doosan, Dongbu, the Hyundai Group and GS Holdings.
I see this ruling as but another chapter in the on-going love-hate relationship between big business and reform government. As what usually occurs the need to boost the economy takes priority over reform...
The other four groups to enjoy the grace period are Lotte, POSCO, the Korea Electric Power Corp. and the Korea Highway Corporation.
The present rule bans conglomerates with more than 5 trillion won in assets from investing more than 25 percent of their net assets in other firms, including their affiliates.
The decision was made between the Fair Trade Commission (FTC) and the ruling Uri Party before the enforcement of the revised Monopoly Regulation and Fair Trade Act (MRFTA) from April 1.
Under the eased rule, three business groups _ Shinsegye, Daewoo Engineering & Construction and LG Cable _ are expected to be excluded from the shareholding limit restriction.
Considering the one-year grace period and the hike in asset threshold, the FTC said 10 conglomerates, including LG, Hyundai Motor, KT and SK, are expected to be subject to the shareholding restriction this year after the enforcement of the revised act.
The six other conglomerates are Hanwha, Kumho Asiana, Doosan, Dongbu, the Hyundai Group and GS Holdings.
I see this ruling as but another chapter in the on-going love-hate relationship between big business and reform government. As what usually occurs the need to boost the economy takes priority over reform...
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