Practice Areas Introduction

The amended Article 542-13 of the Commercial Code, which took effect on April 15, 2012, requires that the listed companies with a certain amount of assets establish a standard and procedures for legal compliance. The listed companies with assets of one trillion won or more must establish and operate a legal compliance system beginning on April 15, 2012 and the listed companies with assets of five hundred billion won or more and up to one trillion won must establish and operate a legal compliance system beginning on January 1, 2014.  The legal compliance system is one component of the internal control standard of a company and at the same time is a major tool for ethical and law-abiding management which is becoming the global standard.  For reference, the Unites States has adopted the Sarbanes-Oxley Act and the Federal Sentencing Guidelines for Organizations in order to integrate the ethical and law-abiding management into the legal system.

Practice Areas

Advising the top management to ensure compliance with prohibition against appropriation of business opportunity, self-dealing, and competitive business

Categorizing and systematizing the working-level requirements under law applicable to companies and industries

Building a database for legal requirements which can be accessed easily and promptly by the working-level staff of the company

Establishing a line of defense against expected disputes which may arise between the company and the interested parties such as customers, subcontractors, and rival companies

Building a permanent warning system which can protect the company properties even before a dispute arises

 

Establishing and operating a practical compliance system can further enhance the competitiveness of the company. The ethical and law-abiding management is not a cost but an investment and such management itself can be the money-making management strategy. Although the management of companies has a vague sense of distance from the compliance system, building the compliance system does not obstruct the management activities and it can rather lay the groundwork for the management to control every corner of the company in a more stable way. That is, a desirable compliance system is not a control system over the management, but a part of the internal control system of the management.  Furthermore, in order to mitigate the impact and costs which may be caused by the full-scale introduction of the compliance system, companies may phase in the compliance system introducing it initially for the sensitive areas such as sales, investment, and strategies.