[Alpha Biz= Paul Lee] The Korea Fair Trade Commission has decided to impose a corrective order and a fine of KRW 9 million on HL Holdings for violating regulations governing holding companies by owning shares in a financial firm.
According to the KFTC, HL Holdings converted into a general holding company on September 2, 2014, but continued to hold 60,000 shares (a 1.03% stake) in Korea Business Finance until August 21 of last year, in violation of the Monopoly Regulation and Fair Trade Act.
Under the law, a general holding company is required to dispose of shares in domestic financial or insurance companies within two years of conversion. However, HL Holdings retained the shares for approximately nine years beyond the grace period.
The Fair Trade Act prohibits general holding companies—excluding financial holding companies—from owning shares in domestic companies engaged in financial or insurance businesses. A two-year grace period is provided for disposal if such shares are held at the time of conversion.
The KFTC stated that the level of sanctions was determined in consideration of the relatively small stake held by HL Holdings, the absence of control over the financial company, and the company’s voluntary corrective actions.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
