Law firm HwaWoo (Managing Partner Lee Myung-soo) said on the 24th that it will hold a seminar on the 3rd of next month with The Federation of Korean Industries (FKI, formerly the Federation of Korean Industries) to review government policy direction and movements by corporations regarding the corporate venture capital (CVC) system.
Venture capital (VC) is financial capital that supports funds, such as by investing in early-stage venture corporations expected to grow, and pursues high revenue. CVC is a type of VC funded by large corporations. While VC operates for financial gain, CVC may pursue mergers and acquisitions (M&A) if it determines that a nurtured venture corporation is strategically necessary.
With the 2021 amendment to the Fair Trade Act, it became possible to establish CVCs under holding companies. Since then, CVCs have taken root as platforms for large corporations to discover new businesses and expand investment in Start - Up.
Recently, the government, the National Assembly, and industry have raised the possibility of adjusting the separation of banking and commerce principle and the CVC system. Easing the 40% cap on outside funds, increasing the share of overseas investments, and improving the 100% subsidiary requirement are under discussion.
President Lee Jae-myung also said in a meeting with Sam Altman, OpenAI Chief Executive Officer (CEO), on Oct. that "within the scope where safeguards are in place to prevent the harms of monopoly, we can consider easing the separation of banking and commerce regulation."
This seminar was prepared as a venue for a government official, industry, and legal experts to share market conditions and explore directions for operating the system going forward, amid ongoing discussions of change.
In the first session, Nam Kyung-mo, director of industrial policy at the Ministry of Trade and Industry (MOTI), will present "Measures to promote investment in national strategic industries." In the second session, Kang Shin-cheon, head of the venture investment division at the Ministry of SMEs and Startups, will explain "The current status of CVC operations and directions for system improvement." Then Park Jin-kyu, a HwaWoo adviser and former Vice Minister of the Ministry of Trade and Industry (MOTI), and attorney Kim Chi-yeol, an expert in holding company and corporate group regulation, will join a discussion.
Hong Jeong-seok, head of HwaWoo's GRC Center, who planned the seminar, said, "As discussions on easing the separation of banking and commerce regulations become full-fledged, it is important to find practical directions from various perspectives so that related systems can encourage investment activities by corporations while maintaining a sound market order." HwaWoo Managing Partner Lee Myung-soo said, "We hope that various corporations seeking to boost investment through CVC will be able to enjoy HwaWoo's high-quality services."
HwaWoo plans to use this seminar as an opportunity to regularly analyze trends in improvements to the CVC system and provide them to corporations, and to strengthen a comprehensive advisory framework on investment, governance, and fair trade issues expected to arise from easing the separation of banking and commerce. The seminar can be registered for on The Federation of Korean Industries website by 10 a.m. on the 1st of next month.