On the 23rd, the third amendment to the Commercial Act focusing on the 'mandatory disposal of self-stock' successfully passed the National Assembly's Legal Affairs Committee, largely driven by the ruling Democratic Party of Korea. This amendment stipulates that when companies acquire their own shares, they must dispose of them within one year. Companies that violate this rule will face a fine of up to 50 million won. Furthermore, the amendment requires companies to dispose of any already held self-stock within one and a half years prior to the law's implementation. Additionally, there are provisions that mandate the equitable disposal of self-stock in proportion to the number of shares held by shareholders, similar to the process for new stock issuance.

The Democratic Party plans to complete the processing of this third amendment at the full assembly during the temporary parliamentary session in February. This amendment is a follow-up to previously passed amendments aimed at expanding the duty of loyalty of corporate directors to shareholders and implementing mandatory cumulative voting and separate election of the audit committee member provisions, further demonstrating the party's commitment to corporate governance reform.

The passage of this third amendment is significant as it reflects ongoing efforts to increase accountability and transparency within corporate governance in South Korea. By mandating the disposal of self-stock and imposing sanctions on violations, the law aims to prevent companies from holding onto their shares indefinitely, promoting better market practices and shareholder rights protection.