The Democratic Party of Korea welcomed the KOSPI index breaking through the 4,000 level, saying it was the result of promoting institutional improvements to revitalize the capital market, such as amending the Commercial Act. It added that within the year it will push a third amendment to the Commercial Act centered on making treasury share cancellation mandatory, and will follow up with steps such as separate taxation of dividends.
The Democratic Party KOSPI 5000 special committee held a press conference at the National Assembly on the 27th and said, the Lee Jae-myung administration and the Democratic Party are promoting institutional improvements to revitalize the capital market, such as amending the Commercial Act, with consistent policy resolve. As a result, from 2,294 on the KOSPI index on Apr. 9, about six months later, an extraordinary change was achieved with an intraday touch of 4,000 today.
On this day, the KOSPI index broke through the 4,000 level intraday for the first time ever. The Democratic Party pledged a KOSPI 5000 era in the last presidential election and, at the party level, has focused on institutional improvements to revitalize the capital market, including the first and second amendments to the Commercial Act.
Special committee Chairperson Oh Gi-hyeong said, there were many questions about whether it was possible when we used the term KOSPI 5000, but cynicism has turned into curiosity and into expectation.
Lee Jeong-mun, a lawmaker on the special committee, also said, there may be various factors behind the rise to KOSPI 4,000, but I believe the amendment to the Commercial Act played a big role, adding, we will work to achieve KOSPI 5,000 by following up with measures such as revising the Financial Investment Services and Capital Markets Act.
The special committee plans to continue institutional improvements for additional KOSPI gains.
Lawmaker Lee Kang-il said, we will do our best to ensure that the policy stance of revitalizing the capital market does not waver or backslide, adding, we will focus on discussions on the treasury share system and tax reform through the end of the year.
He also said, we will push a review of the stewardship code and a reform of the disclosure system.
He said, to revitalize the capital market, beyond systems and policies, the role of investors—especially long-term investors and institutional investors—is important going forward. We hope the role of investors will grow in monitoring rubber-stamp boards and communicating with the management of innovative corporations.
The Democratic Party plans to discuss tax reform, including separate taxation of dividends, in the tax subcommittee in November. It also plans to amend the Financial Investment Services and Capital Markets Act to encourage active stewardship by institutional investors before next year's shareholder meeting season.
Chairperson Oh said, separate taxation of dividends will be discussed in November in the National Assembly Strategy and Finance Committee tax subcommittee. On the third amendment to the Commercial Act dealing with mandatory cancellation of treasury shares, he said, issues related to treasury shares are being discussed centering on the special committee. We are also holding party-government consultations. We are listening to investors' views in various ways, adding, we are supplementing the system on the premise of the principled cancellation of treasury shares.