Economic Circle “to Accept the Principle of Class Action and 5 Working Days per Week”

Five economic associations including the Korea Chamber of Commerce and the Federation of Korean Industries decided to accept in principle the policy of reform such as the class action to be pursed by the Government. On the 19th, 5 economic associations decided to prepared and discuss with the Government the alternatives to minimize the side-effects in line with the implementation of the policy while they accepted the economic policy of the new government in general.

The chairmen of 5 economic associations including Mr. Park Yong-sung, Chairman of the Korea Chamber of Commerce reached their consensus in “not objecting to the policies which a new Government is planning to introduce and preparing rational alternatives” and decided to discuss detailed methods.

On the 18th, in accordance with this executives in charge from 5 economic associations were convened and discussed whether and how the economic circle has to accept major economic policies such as system of class action for the securities, system of restraining the total amount of equity participation, system of five working days per week, and system permitting the employment of foreigners.

They agreed in principle to prepare the mechanism which can preclude an excessive use of lawsuits by applying the system of class action only to the publicly listed companies which have been indicted by the prosecutors due to their fraudulent accountings, manipulations of stock prices and false disclosures having been proved. .

The proposition was made that it would be good to prepare the method for the improvement of the system restraining the total amount of equity participation after the review of the results of its implementation for more than one year despite their agreements with its basic principle in precluding the indiscreet expansion of large enterprises. The system of complete inclusion of inheritance tax and gift tax, which has been proposed by Mr. Noh Moo-hyun, President-elect as one of 3 major tasks for the reform of business conglomerates, was not discussed on that day.

5 economic associations discussed over the labor issues such as 5 working days per week and the system permitting the employment of foreigners. The system of 5 working days per week has been decided to be accepted when it is modified to match with the international standard and postponed in its implementation for the small and medium sized companies. The opinion was expressed that it would be desirable for the system permitting the employment of foreigners to be followed up after the review of the results of the improvement in the government policy. 5 economic associations have plans to prepare a more progressed proposition in the meeting for the group of full-time vice-chairmen to be held on the 22nd.

Yeon-Su Shin ysshin@donga.com