Businesses wary as pro-Lee progressives take helm of key oversight agencies
From left, Ju Biung-ghi, nominee to head the Fair Trade Commission, Lee Chan-jin, the new governor of the Financial Supervisory Service and Lim Kwang-hyun, commissioner of the National Tax Service / Yonhap
Businesses are on edge as the heads of the Fair Trade Commission (FTC), Financial Supervisory Service (FSS) and National Tax Service (NTS) — powerful regulatory bodies overseeing corporate practices — are now occupied by progressives appointed by President Lee Jae Myung, signaling tighter corporate oversight, according to government and business officials Friday.
The FTC imposes fines, pursues criminal cases and regulates corporate governance in response to unfair trade practices, while the FSS takes action against stock manipulation, insider trading and accounting irregularities. The NTS monitors corporate tax evasion and improper share transfers through special audits.
All three watchdog chiefs are also known for their close ties to President Lee, and are considered both progressive and strong-willed.
Ju Biung-ghi, the Seoul National University economics professor nominated to head the FTC, is known as Lee’s “economic mentor.”
Given his emphasis on fairness and redistribution, Ju is expected to tighten regulations on unfair practices by conglomerates and large corporations once in office.
Speaking to reporters Thursday at the Korea Chamber of Commerce and Industry in Seoul, where he is preparing for his confirmation hearing, Ju said, “If powerful economic players use their advantage to block the achievements of innovators, who will dare to innovate or demonstrate entrepreneurial spirit?”
President Lee Jae Myung speaks during a meeting with his senior secretaries at the presidential office in Seoul, Thursday. Yonhap
Lee Chan-jin, a lawyer who was inaugurated as FSS governor on Thursday, was the president’s classmate at the Judicial Research and Training Institute, and is also known for his work with liberal civic groups such as Lawyers for a Democratic Society, popularly known as Minbyun.
The new FSS governor is expected to closely follow the president’s policy agenda, focusing on curbing unfair stock market practices, removing unfair elements in the capital market and strengthening overall regulatory oversight of the financial sector.
Lim Kwang-hyun, who became NTS commissioner on July 24, is recognized as a top investigator within the agency, with extensive experience in special audits targeting tax evasion by conglomerates.
Lim was personally recruited by President Lee during the National Assembly elections in April last year and entered parliament through proportional representation.
His first investigation as NTS commissioner targets 27 companies and individuals, including firms accused of false disclosures for stock manipulation and controlling shareholders who siphoned assets from listed companies — an initiative seen as directly aligned with the Lee administration’s efforts to boost the KOSPI.
The fact that all three agency chiefs are close allies of the president, combined with their track records of restraining corporate activities in their respective fields, is raising alarm in business circles.
With the president seeking to propel KOPSI toward the 5,000 milestone, stronger measures are anticipated, including tougher punishments for unfair trading and stock manipulation.
“The three are all regarded as strong advocates of regulating conglomerates, which is why we are closely watching their moves,” said an official at a major conglomerate, who spoke on condition of anonymity.