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FTC to Change Head of Samsung Group to Lee Jae-yong from Lee Kun-hee
Head of Samsung Group
FTC to Change Head of Samsung Group to Lee Jae-yong from Lee Kun-hee
  • By Michael Herh
  • October 17, 2017, 06:45
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The head of the Samsung Group will change to vice chairman Lee Jae-yong from chairman Lee Kun-hee when the Fair Trade Commission announces the list of large enterprises in April of next year according to new laws.
The head of the Samsung Group will change to vice chairman Lee Jae-yong from chairman Lee Kun-hee when the Fair Trade Commission announces the list of large enterprises in April of next year according to new laws.

 

According to the (FTC) of Korea on October 16, as it has been pointed out as a problem that Lee Kun-hee, chairman of the Samsung Group and Shin Kyuk-ho, chairman of the Lotte Group, have been unable to conduct their management activities as heads of the two groups for a long period of time but officially remain heads of the two groups, the FTC has decided to devise improvement measures to designate persons as heads of Korean business groups in accordance of the purpose of relevant laws and reality.   

According to the Fair Trade Act, the head of a business group means a person who controls a business group (Chaebol). The Fair Trade Act stipulates that a business group has to have a 30% or more stake in its affiliate but there is no separate qualification requirement for the head of a business group in the act.

Chae Yi-bae, a lawmaker of the People’s Party also proposed an amendment to the Fair Trade Act to the National Assembly on September 29. The amendment blocks those who are neither sensible nor able to conduct economic activities independently from becoming business group heads.   

"Lee Kun-hee, chairman of Samsung, has been unconscious for three and a half years since May 2014, and Lotte's general chairman Shin Kyuk-ho has failed to carry out normal business activities since several years ago,” lawmaker Chae said. “It is impractical for the FTC to designate the two people as heads who control Samsung and Lotte."

"We have not yet determined whether to restrict business group heads’ qualifications through an amendment to the Fair Trade Act or other ways," an FTC official said. "We are planning to finalize it before the selection of a group of large enterprises in April of next year after collecting the opinions of the business world."

It is forecast that when qualifications for business group heads are restricted, the head of the Samsung Group will change to vice chairman Lee Jae-yong from chairman Lee Kun-hee and the head of the Lotte Group to chairman Shin Dong-bin from general chairman Shin Kyuk-ho when the FTC announces the list of large enterprises in April of next year.