Asia’s fourth-largest economy plans to deregulate its stock market this year to encourage foreign investment.
South Korea plans to lift a number of rules on the local stock market this year to make it easier for foreign investors to invest, the financial regulator said in an effort to attract more money to the market.
The Financial Services Commission said Tuesday in a statement that there is a huge discrepancy between current regulations and global standards and that “[it] will boldly improve the rules that prevent global investors from investing in our market.”
The regulator said it would lift a three-year-old rule that required foreigners to register with authorities before trading South Korean stocks. Instead, they will be allowed to open accounts using an international identifier such as a passport for individuals or a legal entity identifier (LEI) for organizations.
It will also remove a rule that requires omnibus account holders, such as asset management firms and brokerage houses, to report details of each final investor’s transactions within two days of settlement, as well as open up most over-the-counter trading to foreigners.
Meanwhile, from 2024, listed companies in South Korea will be required to provide corporate documents in English, starting with large companies or companies with a high proportion of foreign shareholders, according to the statement.
The push comes as South Korea pushes its stock market into the Morgan Stanley Capital International Developed Market Index. It is currently classified as an emerging market by the global index provider.
The regulator plans to complete the necessary legislative review process in the first half of this year to make such changes during 2023.
Credit: www.aljazeera.com /