The Financial Supervisory Service said controlling shareholders of large unlisted stock companies must submit their shareholding status.
On the 2nd, the Financial Supervisory Service (FSS) said large unlisted companies must file a report on the shareholding status of controlling shareholders within 14 days after the regular shareholders meeting ends. The watchdog said it is to check whether they fall under the periodic designation criteria for nonseparation of ownership and management.
Large unlisted companies are those that fall under categories such as: ▲ asset of 500 billion won or more at the end of the previous year ▲ subject to filing business reports or belonging to a corporate group subject to disclosure under the Fair Trade Act with asset of 100 billion won or more.
If a large unlisted company that submitted the shareholding status of controlling shareholders falls under the nonseparation of ownership and management standards, it must also submit a basic data filing for auditor designation by Sept. 14.
The standards for separation of ownership and management are: ▲ when the combined equity ratio of the controlling shareholder and related parties is 50% or more of the total number of issued shares and ▲ when a shareholder who is the controlling shareholder or a related party serves as CEO.
If the controlling shareholder has 60% equity but is an inside director, not the CEO, it does not fall under nonseparation of ownership and management. The same applies when the controlling shareholder owns 100% equity and a professional manager serves as CEO.
However, if the controlling shareholder holds 55% equity and a CEO who is in a special relationship with the controlling shareholder owns at least one share, it falls under nonseparation of ownership and management.
A Financial Supervisory Service (FSS) official said, "We will work with related agencies to provide guidance on key points so that large unlisted companies do not violate obligations under the Act on External Audit, and we will respond quickly to related inquiries."