South Korea Expands Treasury Share Disclosure Rule to All Listed Companies
Key points
- South Korea's FSC secured cabinet approval to remove the one per cent threshold for mandatory treasury share disclosure.
- From implementation, any listed company holding treasury shares must disclose retention and disposal plans, not just those at or above one per cent of issued stock.
- The change follows the revised Commercial Act requiring all companies to prepare treasury share plans for shareholder approval.
- The FSC frames the expansion as encouraging active treasury share use for shareholder value, with subordinate regulations and reporting standards to be aligned.
South Korea’s Financial Services Commission has secured cabinet approval for a revision to the capital markets enforcement decree that removes the one per cent threshold for mandatory treasury share disclosure. Previously, only listed companies holding treasury shares equal to or exceeding one per cent of total issued stock had to disclose retention and disposal plans; from implementation, any listed company holding treasury shares must file such disclosures.
The change follows the revised Commercial Act, which now requires all companies to prepare treasury share retention and disposal plans for shareholder approval. The FSC positions the expanded disclosure requirement as a lever to encourage active treasury share use for shareholder value enhancement, a policy direction flagged in March. Subordinate regulations and corporate disclosure reporting standards will be updated to align with the new decree.
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