Chairperson Ju Biung-ghi said on the 23rd that easing the separation of industrial and financial capital regulations is the last resort to reinvigorate investment in advanced industries and should be reviewed carefully. The separation of industrial and financial capital regulations, in principle, prevent industrial capital such as large conglomerates from running financial companies such as banks or asset management firms.
The Chairperson's remarks run counter to the positions of President Lee Jae-myung and Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol, among other senior government officials. Earlier, President Lee signaled last month that he could ease separation of industrial and financial capital regulations to spur investment in artificial intelligence (AI). Deputy Prime Minister Koo said at a press briefing on the 19th that it could be considered if there is a shortage of large-scale investment funds.
At a press briefing on the 21st, his first after taking office, the Chairperson was asked about his position on easing the separation of industrial and financial capital regulations. The Chairperson said that if separation of industrial and financial capital is needed as one way to reinvigorate investment in advanced industries, he could review the necessity. He added that concentration of economic power and the harms of monopolies are important problems for the Korean economy, and that in a situation where such problems persist, easing the separation of industrial and financial capital regulations should be approached carefully based on social consensus.
In response to a question asking whether easing the separation of industrial and financial capital is the last card or last resort, the Chairperson said that if there is truly no other way, easing the separation should be considered, and if there are other alternatives, those should be considered first. He added that the law cannot be changed because of the petitions of a few companies, and said he was quite dissatisfied that the discussion seems to be largely a kind of petition-driven debate from one side, when it should take place from diverse perspectives.
In industry, there have been projections that if the government eases the separation of industrial and financial capital regulations, groups such as SK Group, which has a holding-company structure and focuses on the AI industry, could benefit. SK Group Chairman Chey Tae-won said at the launch ceremony of the Corporate Growth Forum in September that even if large corporations want to invest in advanced industries, there is little they can do because of the separation of industrial and financial capital regulations. However, at a forum on the 20th, Chey said that he did not want separation of industrial and financial capital, but asked for a new system that can accommodate new investments.
The Chairperson also expressed a negative view of calls from the business community to shrink the scope of business groups subject to disclosure (large conglomerate groups). The Fair Trade Commission designates large conglomerates with assets of 5 trillion won or more each year as large business groups and intensively monitors and supervises whether there have been violations of the Fair Trade Act. The Chairperson said that the request to reduce the business groups subject to disclosure runs counter to the times and that it should instead be expanded. He also said that the same-person system, which designates the head of a large business group, should be further strengthened so that the problem of wrongful management involvement by the controlling family is resolved.