The National Assembly on Feb. 25 at an extraordinary session passes the third amendment to the Commercial Act with 176 members attending in a 175-0 vote with one abstention. (Yonhap News)

By Yoo Yeon Gyeong

The National Assembly on Feb. 25 passed the third amendment to the Commercial Act requiring companies to cancel their own shares.

The revision was approved in a plenary session with 176 members present in a 175-0 vote with one abstention.

Intended to improve the structure of the financial and capital markets, the amendment requires companies to cancel their own shares within a year of acquiring them.

The revision also allows for exceptions if a disposal plan signed and stamped by all directors is approved at the general shareholder meeting like executive compensation or adoption of an employee stock ownership plan.

The Financial Services Commission also announced that day a substantially raising of rewards for whistleblowers who report unfair trade practices and accounting fraud. From as early as late May, those who report capital market crimes such as stock manipulation or accounting fraud can receive up to 30% of illegally obtained gains or resulting fines.

dusrud21@korea.kr