[Bills in Focus] Strengthening workplace safety, minority shareholders

Proposed Bill: Partial Amendment to the Act on the Collection of Insurance Premiums for Employment Insurance and Industrial Accident Compensation Insurance

Proposed by Rep. Cho Ji-yeon (People Power Party)

● In response to the tragic fire at a lithium battery factory in Hwaseong, Gyeonggi Province, which resulted in the loss of 23 lives -- 18 of whom were residents of foreign nationality — this proposed amendment aims to tighten the accountability of risk assessment certifications for workplace safety. The government is planning to revamp an existing risk assessment recognition program managed by the Korea Occupational Safety and Health Agency.

Currently, businesses conduct their own risk assessments. Those deemed by KOSHA to have superior risk management practices receive benefits, such as reduced premiums for industrial accident insurance. However, the devastating fire highlighted significant flaws in this system, as the factory involved was safety-certified.

This amendment proposes that if a significant accident, like the fire in Hwaseong, occurs within the certification period, companies would be required to repay any industrial accident compensation benefits they received as part of their recognition. The intent is to ensure that safety certifications accurately reflect a company's commitment to accident prevention and to encourage continuous diligence in maintaining safe working conditions.

Proposed Bill: Partial Amendment to the Commercial Act

Proposed by Rep. Lee Kang-ill (Democratic Party of Korea)

● This amendment specifies corporate directors' duty of loyalty and duty of fairness and restricts the voting rights of management and major shareholders who have been indicted for embezzlement or misappropriation. It also requires listed companies to hold virtual shareholders’ meetings and enable electronic voting.

This proposed amendment aims to address the structural limitations of the current Commercial Act, which inadequately protects minority shareholders from the dominance of management and major shareholders, according to Lee. To counter these issues, the amendment explicitly defines directors' duty of loyalty and duty of fairness, ensuring that directors act impartially and do not favor specific shareholders or stakeholders when executing their duties.

Moreover, the bill seeks to protect minority shareholders by restricting the voting rights of management and major shareholders who are indicted for crimes such as embezzlement or misappropriation, allowing for fairer decision-making by all shareholders. To further empower shareholders, the amendment mandates listed companies to facilitate virtual shareholders' meetings and enhance electronic voting options, enabling minority shareholders to exercise their rights in a fair and equitable management environment.

Pending Bill: Act on the Promotion of AI Advancement and the Establishment of Trust Framework for AI

Proposed by Rep. Jeong Jeom-sig (People Power Party)

● To establish a regulatory framework for the safe and reliable advancement of AI, this bill mandates a triennial AI master plan covering policy direction, industry promotion and trust framework establishment. It proposes the creation of a National AI Committee, a National AI Center and an AI Safety Research Institute. It also imposes a duty on high-risk AI business operators to ensure reliability and safety and mandates transparency for operating generative AI systems.

Promulgated Bill: Game Industry Promotion Act

Competent Authority: Ministry of Culture, Sports and Tourism

● This bill requires foreign game providers to appoint a domestic representative to fulfill indication obligations for game products. Violations may result in fines of up to 20 million won ($14,500). It also relieves game-related businesses from punishment if youth access age-restricted products through deception or threat.

Administrative Announcement: Partial Amendment to the Enforcement Decree of the Broadcasting Act

Competent Authority: Ministry of Science and ICT

● This amendment eases entry regulations for program providers in radio, data and VOD by changing the registration system to a reporting system. It also removes restrictions that previously limited IPTV providers from excessive channel ownership or influence.

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The Korea Herald republishes a weekly legislative report by local law firm DR & AJU LLC to provide the latest information on bills approved, proposed, pending and set to be promulgated. -- Ed.

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For queries about the bills, contact cr@draju.com