Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
Special listing track rules for tech firms to be eased to spur investment
Financial Services Commission (FSC) flag stands between Korean flags in this file photo. Courtesy of FSC
By Anna J. Park
By Anna J. Park
The Korean government plans to overhaul requirements for the special listing track, which applies to exceptional tech innovators and startups, aiming to stimulate active investment into the venture capital sector.
According to the Financial Services Commission (FSC) and the Korea Exchange (KRX) on Tuesday, the government has been holding a weekly taskforce meeting with associations of the venture capital industry and the bio industry, along with other related scholars, to draw up measures to improve the current special listing track allowed for tech firms by the end of July.
The taskforce is currently reviewing measures to eliminate unnecessary requirements, including a mandatory technology assessment under certain conditions, that guarantee a firm's holding of top-rated technologies. The team also examines measures to streamline listing procedures so that innovative startups in need of the special track could effectively raise capital through a public offering. Rules limiting applications for the special listing track will also be eased so that it can be widely adopted by eligible firms.
Besides reviewing the listing requirements, the taskforce team also examines other issues of the capital market that could induce further investment, such as local frameworks to facilitate M&A transactions and private stock trading.
Such moves come as the government attempts to counter the slowing venture investments in the country amid growing uncertainty surrounding the global economy. Sluggish investment into this cutting-edge sector has brought about concerns that it could hamper the economy's growth potential.
“The decrease in both venture investment and the listing of tech firms is a common phenomenon occurring worldwide due to changes in the global macroeconomic environment,” an official from the FSC pointed out.
“Against that backdrop, the related ministries share an urgent recognition of the need to nurture advanced technologies and select competitive companies to foster, in order to achieve sustainable growth of the economy. To this end, the government will actively improve related systems and operational issues to increase successful listings of promising tech firms.”
Yet, the official also stressed that the easing of rules for the special listing track does not mean that companies lacking competencies can easily go public under the new system. Along with the moves to ease requirements, financial authorities plan to strengthen investor protections by strengthening disclosure obligations on the earnings and technological development process.
During the first quarter of this year, the aggregated amount of venture capital investment stood at 900 billion won ($700 million), a whopping 60.3 percent decline from the same period last year.