Gov`t to introduce special law on corporate restructuring

The government is considering the introduction of a special law to expedite corporate restructuring. In addition, it will push forward a plan to advance the privatization of financial institutions that have received public funds and foster securities firms as large-scale investment banks.

Byeon Yang-Ho, director-general of the financial policy bureau at the Ministry of Finance and Economy, told reporters Friday that the government had decided to enact a special law to expedite restructuring and liquidation of nonviable firms. The legislation would be proceeded with apart from the ongoing work to consolidate the three bankruptcy laws, he said.

In a related development, it was reported that ruling and opposition lawmakers at the finance and economy committee of the National Assembly recently agreed in principle on the need to enact a special law on corporate restructuring. The special law is expected to contain strengthened regulations about state supervision and disposition of nonviable companies to support the ordinary corporate restructuring system.

Meanwhile, the government and ruling Millennium Democratic Party (MDP) held the first meeting of the special commission for checking restructuring in four major sectors with prime minister Jin Nyum and MDP policy committee chairman Lee Hae-Chan participating. At the meeting, they decided to advance the privatization of financial institutions that had received public funds as early as possible according to conditions in the stock market. The privatization was originally scheduled for the second half of next year.

They also decided to form a special consultative body to deal with Daewoo Motor`s labor dispute in an effort to prevent the recent violent crackdown by riot police on striking Daewoo workers from having a negative effect on labor negotiations at other companies in May and June.

Kwon Soon-Hwal shkwon@donga.com