KOSDAQ Will Not Be Separated

A securities policy of `Roh Moo-Hyun`s administration which will commence late in February, has been sharply outlined.

According to the ministry of finance and economy (MOFE) and the presidential transition committee on January 6, the presidential transition committee has been preparing a definite measure by selecting the policy of major securities field which must be concluded at the beginning of the next government. The pending questions include △ a withdrawal of insolvent enterprises in KOSDAQ, △ a reorganization of KOSDAQ-related institutes, △an introduction of securities group lawsuit system and △a transfer of the stock index futures market into Busan.

▽Withdrawal of insolvent enterprises in KOSDAQ = Lee Seok-Jun, head of the securities system, MOFE said, “The existing withdrawal regulations will be applied and the separation of KOSDAQ enterprises is not considered.”

The government examined a plan which divides KOSDAQ into a part 1 and part 2 and sends the well-managed companies to the part 1 as one of means for the securities stabilization at the end of last year. However, there were many contrary opinion which worried about the group insolvency of enterprises in the part 2, and so the separation of KOSDAQ will not be considered.

Besides, it is forecasted that the current system will be improved. The official of Financial Supervisory Commission (FSC) said, “We are currently examining the measure which separates companies by scales such as assets like NASDAQ.”

▽Reorganization of KOSDAQ-related institutes = KOSDAQ market is currently operating three institutes of the securities dealers association(market opening), KOSDAQ committee(registration, withdrawal, management and supervision) and KOSDAQ stock market(public announcement and transaction intermediation). Three institutes have requested the reorganization because of a crossed authority and responsibility.

One anonymous member of committee explained, “We will investigate the criticized KOSDAQ-related institutes. A form of the Stock Exchange is considerable.” When it is reorganized into the form of the Stock Exchange, KOSDAQ stock market will undertake most functions of KOSDAQ committee.

▽ Introduction of securities group lawsuit system = The business community repelled the introduction of securities group lawsuit system which is one of public pledges of the president-elect Roh. However, it is forecasted that there will be a movement of legislation in any shape because of strong will of the president-elect Roh and the presidential transition committee.

Jeong Se-Gyun, member of Minju party said, “The related regulation must be amended rapidly to increase a transparency of the stock market.

A variable is the movement of Hanara party and a repelling of the business community. The officials of the stock market expect that its introduction will be not easy in the first half of the year when an adverse criticism get large. However, it is forecasted that the related regulations such as the securities trading law will be revised in the year.”

▽ Transfer of the stock index futures market to Busan = When there is no special measure according to an enforcement ordinance of the futures trading law, the stock index futures market is scheduled to be transferred into the futures exchange of Busan from January 2004. For it, a labor union of the stock exchange has strongly repelled.

Lee Dong-Geol, member of the presidential transition committee said, “Because the transfer of the futures market is the critical problem, we must examine it carefully.” However, the MOFE and FSC announced, “The presidential transition committee will examine, but it is hard to change the decision.”

Eun-Woo Lee libra@donga.com