- The Financial Services Commission said it is seeking to create an exception that would exclude major shareholders of virtual-asset service providers from disqualification when criminal penalties were imposed under vicarious liability provisions or involved minor violations.
- The FSC said it plans to revise the shareholder qualification screening standards for virtual-asset service providers, drawing on cases under the Capital Markets Act and the Online Investment-Linked Finance Business Act, in response to industry concerns over the amendment to the enforcement decree of the Act on Reporting and Use of Certain Financial Transaction Information.
- The FSC said it will pursue measures including improvements to network separation regulations tied to blockchain, artificial intelligence (AI) and won-based stablecoins, steps to enhance interoperability and scalability, and monitoring of the impact of Upbit’s stablecoin fee-waiver policy.
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South Korea’s Financial Services Commission is seeking to create exceptions that would let major shareholders of virtual-asset service providers avoid disqualification even if they receive criminal penalties for legal violations, when the penalties stem from vicarious liability provisions or involve minor offenses.
In a written response submitted to the National Assembly’s Political Affairs Committee, the FSC said it plans to add exceptions to the qualification screening standards for major shareholders of crypto firms, Newsis reported on Aug. 10. The plan reflects recommendations from the presidential Regulatory Rationalization Committee.
The FSC said it will revise the system by referring to precedents under the Capital Markets Act and the Online Investment-Linked Finance Business Act. Under the plan, criminal penalties tied to a major shareholder’s legal violations would be excluded from disqualification from registration if they were imposed under vicarious liability rules or involved minor breaches.
The move reflects industry concerns over amendments to the enforcement decree of the Act on Reporting and Use of Certain Financial Transaction Information, which take effect on Aug. 20. The revised decree adds records of violations of the Fair Trade Act, the Punishment of Tax Evaders Act and the Act on the Aggravated Punishment of Specific Economic Crimes to the grounds for disqualifying major shareholders of virtual-asset businesses. It also applies those standards not only to new registrations but also to renewal reviews conducted every three years.
