Financial regulator vows deregulation to meet global standards

All News 11:29 September 15, 2022

By Chung Joo-won

SEOUL, Sept. 15 (Yonhap) -- South Korea's financial regulator is looking to ease or lift regulations that have caused the undervaluation of the local capital market, a senior official said Thursday.

"We will find and unshackle the regulations that exist only domestically and not in advanced countries, which have become obsolete and unreasonable, and cannot comply with the latest changes in technology," Financial Services Commission (FSC) Vice Chairman Kim So-young said in a seminar in Seoul.

The FSC is considering scrapping the registration system for foreign investors, a key hurdle for the country's inclusion on the Morgan Stanley Capital International (MSCI) index.

The registration system requires foreigners to report their identification info to the regulator before trading shares of locally listed companies.

"We have many issues under review, such as the foreign investor registration system that has been running since the early 90s and now requires reasonable changes," Kim said.

In June, the MSCI did not include the South Korean stock market on its watchlist for developed market status, after evaluating Asia's fourth-largest economy as insufficient in foreign accessibility.

In addition, the FSC is pushing to unveil guidelines for higher transparency in accounting, an improved assessment system for the delisting process and better handling of IPO filings, within this year, Kim said.

"We hope that these efforts can help (the South Korean capital market) receive a worthy evaluation (globally) and generate a new growth paradigm for a lasting advancement," he added.