Hybrid Equity Finance법제의 평가와 과제 — 종류주식 개정 관련 이슈 —

Far-reaching amendments of the Commercial Code of Korea were passed in the National Assembly on March 11, 2011, and took effect in 2012. Most of all, the change of company law is expected to expand in several ways the options available to corporations in terms of equity and debt financing. For example, the revised Commercial Code increased the types of shares from the current few such as ordinary and preferred stock in order to recognize the issuance of diversified classes that differ not only in terms of dividends but also of voting rights. Accordingly, corporations will able to issue non-voting common shares, as well as non-voting preferred shares. Convertible shares may allow for conversion at the election of the issuer, and not only at the election of the holder. In addition, there is some statutory protection given to the holders of a class of shares against the rights on their shares being altered. A minority class of shares, or a class of non-voting shares, would otherwise be vulnerable to the rights on those shares being altered by the majority (e.g. by altering the articles by special resolution). On the other had, as the nurturing of venture business has come into greater focus, the need has arisen for classess of shares with varied voting rights befitting the requirements of venture capitalists and other investors. Accordingly, the revised Commercial Code permits the issuance of a type of stock(limited voting-right share) that differs from the others in voting rights as well as in dividend. However, with this revision, the code will not enable companies to issue stocks that carry different provisons concerning the right to elect and dismiss directors. At the same time, new Code prompted the question like whether ordinary shares are one of class of stock or not. Accordingly, lots of care need to be taken when creating different classes of shares and, indeed, in issuing shares generally.