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  • Samsung Signs Long-Term Supply Contracts with Big Tech Amid Memory Shortage
    Samsung Signs Long-Term Supply Contracts with Big Tech Amid Memory Shortage Samsung Electronics has entered into long-term supply contracts of up to five years with major global tech companies, aiming to establish a stable revenue structure. As the demand for semiconductor supply is expected to continue until 2028 due to the expansion of artificial intelligence (AI) infrastructure, Samsung has achieved record sales in both DRAM and NAND flash products.During a conference call on its second-quarter earnings held on July 30, Samsung reported that its semiconductor (DS) division reached all-time high sales for both DRAM and NAND, driven by strong market demand and unmatched product competitiveness. The strong dollar also positively impacted the parts business, contributing approximately 3.1 trillion won.The imbalance in the memory market is expected to persist. Kim Jae-jun, Vice President of the Memory Business Division, stated, "Considering the lead time of over three and a half years from new fab construction to production, meaningful supply expansion will be difficult until 2028. The unmet demand due to supply shortages will continue into next year and will worsen in 2027 compared to this year."Samsung announced that it has completed long-term contracts with five global data center customers for five-year terms. The company is also pursuing additional contracts with five global hyperscalers. It has secured advance payments amounting to a quarter of the contract value and has locked in 60-70% of its total DRAM capacity under long-term agreements, significantly reducing performance volatility risks.In the second half of the year, Samsung plans to increase the shipment proportion of HBM4 to 60% to solidify its technological leadership.The foundry division is preparing to begin operations at the Taylor Fab 1 in the U.S. this year. Construction of Fab 2 is also set to start this year to gradually expand its 2-nanometer capacity, with mass production expected by 2030.In the display sector, despite initial fixed cost burdens from the new 8.6-generation IT OLED operations, Samsung aims to enhance cost competitiveness through improved yields.Capital expenditures (CAPEX) for the second quarter increased by 5.5 trillion won from the previous quarter, totaling 16.8 trillion won, focusing on infrastructure development at the Pyeongtaek campus, advanced R&D, and investments in the Taylor Fab in the U.S.Regarding shareholder return policies, Samsung stated, "We are faithfully implementing our existing three-year regular dividend policy of 9.8 trillion won annually," adding that it is exploring various options for future shareholder returns, including special dividends and stock buybacks.However, the company clarified that it is not considering issuing American Depositary Receipts (ADRs) for fundraising purposes.To secure future growth drivers, Samsung has also restructured its organization. It recently established the 'RX Promotion Office' dedicated to its robotics business and has recruited top global talent led by Lee Dong-geon, head of the strategy team. The company plans to build a personal robotics ecosystem by combining on-device AI with its Knox security system and actively pursue mergers and acquisitions of promising overseas startups.In the DX division, which includes home appliances and mobile, operating profit has declined due to rising component costs. Anticipating a slowdown in mobile market demand in the second half, Samsung emphasized, "We will focus all efforts on defending profitability through premium form factors like the recently unveiled Galaxy Z Fold/Flip 8 series and hyper-personalized AI agent services."* This article has been translated by AI. 2026-07-30 12:08:10
  • Financial Commission Introduces IPO Cornerstone Investor and Pre-demand Forecasting Regulations
    Financial Commission Introduces IPO Cornerstone Investor and Pre-demand Forecasting Regulations The Financial Services Commission has begun revising regulations to introduce pre-demand forecasting and cornerstone investor systems in the initial public offering (IPO) market. The aim is to enhance the rationality of pricing and mitigate significant stock price drops following large-scale sell-offs immediately after listing.On July 30, the Financial Services Commission announced that the proposed amendments to the Capital Markets Act, which will implement the pre-demand forecasting and cornerstone investor systems, are set to take effect on November 13. The commission is inviting public comments on the related enforcement decree and regulations regarding the issuance and disclosure of securities from today until September 8.Pre-demand forecasting allows underwriters to gauge market demand for the offering price and volume from institutional investors before submitting the securities registration statement. This system is expected to improve the appropriateness of the offering price by reflecting market demand from the initial stages of setting the desired price range.Eligibility for participation in pre-demand forecasting has been set at a total entrusted property of 30 billion won for general private investment firms and investment advisory firms, in line with the current demand forecasting system. However, the existing exception that allows a reduction to 5 billion won after two years of registration will not apply. The Financial Investment Association will establish minimum qualification requirements, including capabilities for business valuation and management of undisclosed information.After preparing a due diligence report, underwriters will provide qualified institutional investors with information that will be disclosed through the future securities registration statement and gather their opinions on pricing and volume. This process will require a non-disclosure agreement (NDA), and the timing, recipients, and content of the information provided must be documented and managed. Violating the NDA by allowing a third party to use undisclosed information may constitute insider trading.The cornerstone investor system involves pre-allocating a portion of the shares designated for institutional investors, with a condition of a lock-up period of at least six months. This aims to secure long-term investment-oriented institutions in advance, thereby enhancing trust in the IPO and alleviating the so-called 'IPO horror stories' caused by mass sell-offs immediately after listing.To qualify as a cornerstone investor, in addition to meeting the pre-demand forecasting criteria, institutions must hold self-capital or entrusted property equivalent to at least 20 times the subscription amount. This relative standard is applied based on the subscription size, considering the varying scales of IPOs among companies.To diversify the lock-up periods, 50% of the allocated shares will be locked for six months, 30% for eight months, and 20% for ten months.The allocation limits for cornerstone investors will differ between KOSPI and KOSDAQ. Excluding shares allocated to general subscribers, employee stock ownership associations, high-yield funds, and KOSDAQ venture funds, KOSPI will allow up to 20% of the total institutional allocation for cornerstone investors, with individual investors capped at 10%. For KOSDAQ, the limits are set at 30% for total allocations and 20% for individual allocations.To prevent abuse of the cornerstone investor contracts as a means of preferential treatment or risk transfer, cornerstone investor agreements cannot be made with institutional investors that have interests, such as major shareholders and related parties. Any actions that involve providing direct or indirect benefits conditioned on cornerstone investor agreements are also prohibited.The Financial Services Commission plans to finalize the amendment process in line with the implementation schedule of the Capital Markets Act on November 13, following a public comment period for the proposed enforcement decree and regulations.* This article has been translated by AI. 2026-07-30 12:04:20
  • Eight Schools in Seoul Transition to Coeducation Amid Alumni Opposition
    Eight Schools in Seoul Transition to Coeducation Amid Alumni Opposition As the number of school-age children continues to decline, the transition of single-gender schools in Seoul to coeducation is accelerating. Eight middle and high schools, including Muhak High School and Seongsim Middle and High School, have been confirmed to transition to coeducation in 2027 and 2028. However, strong opposition from alumni of these long-established institutions suggests a challenging road ahead for the transition.On July 30, the Seoul Metropolitan Office of Education announced that it has finalized the list of eight schools approved for coeducation out of 11 that applied for the 2027-2028 academic year. This transition is being pursued to maintain appropriate school sizes in light of declining student numbers and to alleviate issues related to long commutes for students in certain areas and gender imbalances.In May, the Seoul Education Office reviewed various factors for the 11 schools (five middle schools and six high schools) that applied, including student placement conditions, the necessity of coeducation, school operation committee deliberations, and facility conditions.As a result, the coeducation transition for eight schools was deemed 'appropriate.' The schools transitioning in the 2027 academic year include Jeongwon Middle School, Seongsim Middle School, Sinjeong Middle School, Muhak High School, Seoul Sinjeong High School (specialized high school), Hanyang Middle School, and Hanyang Science and Technology High School (specialized high school). The only school transitioning in 2028 is Seongsim High School.In contrast, three schools, including Hwikyung Middle and High School and Songgok High School, were not approved this time due to the need for collaboration with nearby schools and placement conditions, and they have been classified for 'long-term review.' The education office plans to reconsider the coeducation transition for these schools based on future changes in conditions.The Seoul Education Office is also preparing support measures to ensure that the eight schools transitioning to coeducation can smoothly start the new academic year. They will provide differentiated facility improvement funds for restrooms, health rooms, and changing rooms to ensure that both male and female students can live comfortably.Additionally, to assist school members in adapting and to ensure stable guidance, a 'transition support fund' totaling 300 million won (approximately $224,000) will be allocated over three years to each school (240 million won for operational costs and 60 million won for personnel costs). The education office will also actively support the timely completion of various administrative procedures necessary before the transition, such as name changes and ordinance amendments.Seoul Education Superintendent Jeong Geun-sik expressed hope that the confirmation of coeducation will improve students' commuting conditions and create a more demand-driven educational environment. He stated, 'We will continue to proactively respond to changes in the school-age population to enhance the competitiveness of education in Seoul and ensure students' right to learn.'However, underlying these plans from the education office is a painful conflict. In particular, the alumni association of Muhak High School, which was established in 1940 and has a tradition of 86 years, is strongly opposed to the transition.The school administration emphasizes that the transition to coeducation is an 'inevitable choice' to ensure smooth educational operations, such as the high school credit system, due to a continuous decline in student numbers, which may require further reductions in class sizes next year. In fact, the number of students at Muhak High School has dropped by 22.1%, from 521 in 2023 to 406 in 2026.However, the alumni association and some current students are strongly opposing the transition, arguing that it is a unilateral move that undermines the identity of the school with 86 years of tradition without sufficient public discourse.The alumni have formed an emergency response committee against the coeducation transition and are continuing large-scale protests and signature campaigns in front of the education office and within the community. Despite heavy rain and heat, the alumni have taken to the streets multiple times, demanding a meeting with Superintendent Jeong Geun-sik and urging the withdrawal of the transition.* This article has been translated by AI. 2026-07-30 12:04:20
  • Construction Firm fined $1 million for Violating Subcontracting Laws
    Construction Firm fined $1 million for Violating Subcontracting Laws A construction company has faced sanctions from regulatory authorities for failing to pay subcontractors and not issuing contracts for additional work.On July 30, the Fair Trade Commission announced it would impose a fine of 1.03 billion won (approximately $1 million) on Geunryong Construction for violating subcontracting laws. Geunryong Construction primarily builds medical and religious facilities.According to the commission's investigation, Geunryong Construction did not pay 100 million won to a subcontractor for mechanical work completed during renovations and expansions at Yes Gumi Nursing Home. The company also failed to issue a contract for additional work that was not included in the original agreement.Additionally, Geunryong Construction received advance payments from the client but did not pass these funds on to the subcontractor. Despite having no valid reasons for exemption, the company also failed to issue a payment guarantee.The Fair Trade Commission deemed these actions violations of subcontracting laws. Under these laws, primary contractors must pay subcontractors within 60 days of project completion and issue written contracts before work begins. They are also required to pay a proportionate amount within 15 days of receiving advance payments and provide a payment guarantee within 30 days of contract signing. Obligations regarding payment adjustments due to design changes must also be adhered to.As a result, the commission has ordered Geunryong Construction to pay the fine of 1.03 billion won, along with a payment order and a directive to prevent future violations. The company has also been issued corrective orders regarding the failure to issue written contracts, the non-payment of advance funds, and the lack of payment guarantees, as well as the failure to adjust payments for design changes.A commission official stated, "We will continue to work diligently to rectify unfair trading practices and protect the rights of subcontractors by strictly sanctioning violations of subcontracting laws."* This article has been translated by AI. 2026-07-30 12:04:20
  • Chemical Handling Facilities Decrease, but Variety of Chemicals Increases by 18%
    Chemical Handling Facilities Decrease, but Variety of Chemicals Increases by 18% 국내 화학물질 취급 사업장은 줄었지만 산업 현장에서 다루는 화학물질의 종류는 2년 새 18% 늘어난 것으로 나타났다. 화학물질 취급이 일부 사업장에 집중되는 동시에 취급 물질은 다양해지면서 사업장별 안전관리 부담도 커질 것으로 보인다. 기후에너지환경부는 '제6차 화학물질 통계조사' 결과 2024년 전국 3만5969개 사업장에서 총 3만8855종의 화학물질을 취급한 것으로 집계됐다고 30일 밝혔다. 2022년 제5차 조사와 비교하면 취급 사업장은 7.4%(2860개) 감소했지만 취급 화학물질은 18.1%(5945종) 증가했다. 사업장 한 곳당 취급하는 화학물질이 전반적으로 다양해지면서 물질별 특성을 반영한 관리와 사고 대응의 중요성이 한층 커졌다는 분석이다. 형태별 취급량은 제조 6억860만t, 수입 3억7960만t, 사용 10억1000만t, 수출 1억5890만t으로 집계됐다. 2022년보다 제조량은 5.5%, 수입량은 1.9%, 수출량은 23.0% 증가했다. 반면 국내 공정에서 쓰인 사용량은 13.0% 감소했다. 업종별로는 화학물질 및 화학제품 제조업의 제조량이 2억1460만t으로 가장 많았다. 코크스·연탄 및 석유정제품 제조업이 2억1050만t으로 뒤를 이었다. 두 업종의 제조량은 총 4억2510만t으로 전체의 약 70%를 차지했다. 지역별로는 취급 사업장의 43.7%가 경기와 서울에 몰렸다. 다만 대규모 제조와 사용은 석유화학·철강 등 주요 산업단지가 위치한 울산과 전남, 충남에 집중됐다. 이들 세 지역은 전국 화학물질 제조량의 76.8%, 사용량의 61.8%를 차지했다. 특히 울산·전남·충남의 사업장 수는 전국의 12.0%에 불과하지만 제조량은 4억6740만t에 달해 지역별 취급 규모의 편차가 큰 것으로 나타났다. 유해화학물질 취급도 전반적으로 늘었다. 2024년 취급된 유해화학물질은 1683종으로 2년 전보다 28종 증가했다. 제조량은 7560만t, 수입량은 1700만t, 사용량은 7050만t, 수출량은 2030만t이었다. 2022년과 비교해 제조량은 8.0%, 수입량은 26.9%, 사용량은 6.2%, 수출량은 4.6% 각각 증가했다. 조사 결과의 세부 데이터는 31일부터 화학물질안전원 화학물질종합정보시스템에 공개된다. 조현수 기후부 환경보건국장은 "이번 통계조사 결과를 바탕으로 변화하는 화학물질 취급 특성을 면밀히 분석하고 과학적 근거에 기반한 안전관리 정책을 추진하겠다"고 밝혔다.* This article has been translated by AI. 2026-07-30 12:04:10
  • New Regulations for Bottled Water Storage and Usage
    New Regulations for Bottled Water Storage and Usage 먹는샘물의 실내 보관이 원칙으로 정해지고 직사광선 차단 조치가 의무화된다. 반복해서 사용하는 10ℓ 이상 대용량 생수통은 제조일로부터 최대 10년까지만 사용할 수 있다. 기후에너지환경부는 이 같은 내용을 담은 '먹는샘물 등의 기준과 규격 및 표시기준 고시'와 '먹는물 관련 영업장 등의 지도·점검에 관한 규정'을 개정해 31일부터 시행한다고 30일 밝혔다. 이번 개정은 여름철 직사광선 노출과 노후 물통 재사용 등 생수 제조·유통·보관 과정에서 발생할 수 있는 품질 저하를 예방하기 위해 마련됐다. 우선 먹는샘물은 실내에 보관하는 것이 원칙이 된다. 보관 장소에 창문이 있으면 차광시설이나 장치를 설치해 직사광선 노출을 막아야 한다. 불가피하게 실외에 보관할 때도 덮개 등을 사용해야 한다. 다만 영세사업자의 준비 기간을 고려해 해당 규정은 2년 뒤부터 적용한다. 반복 사용하는 10ℓ 이상 폴리카보네이트 재질 용기의 재사용연한은 10년으로 제한된다. 이물질이 들어가거나 악취가 발생한 용기, 외관이 손상된 용기는 사용 기간과 관계없이 즉시 폐기해야 한다. 용기 바닥에는 제조일자 표시도 의무화된다. 고시 시행일을 기준으로 이미 제조된 지 10년이 지난 용기는 먹는샘물 제조에 사용할 수 없다. 제조일자 표시 의무는 업계 준비 기간을 고려해 1년간 유예한다. 이에 따라 지금까지 외관만으로는 확인하기 어려웠던 대용량 생수통의 사용 기간을 제조·유통업체가 직접 관리할 수 있게 된다. 먹는샘물 유통기한의 상한은 2년으로 설정된다. 유통기한 연장에 필요한 행정절차와 제출 서류도 구체화했다. 연장을 위한 제품시험의 보관 온도는 기존 상온인 15~25도에서 실제 유통 환경을 반영한 실온 1~35도로 확대한다. 수질기준을 위반한 업체에 대한 사후관리도 강화한다. 기존에는 원수나 제품수가 수질기준을 초과하더라도 관할 시·도지사의 판단에 따라 지도·점검을 실시했지만 앞으로는 분기마다 한 차례 이상 의무적으로 점검해야 한다. 유통 중인 먹는샘물에 대한 수거검사는 여름철을 포함해 연 4회 이상 실시한다. 수거검사 대상에는 10ℓ 이상 대용량 제품도 포함된다. 수질기준 위반 업체에 대한 점검과 시중 제품 수거검사가 모두 최소 분기별로 이뤄지면서 제조단계뿐 아니라 유통단계의 관리도 상시화된다. 김호은 기후부 물이용정책관은 "먹는샘물의 보관·유통 과정에서 발생할 수 있는 문제를 예방하고 사후관리 체계를 강화해 보다 안전한 관리체계가 마련될 것으로 기대한다"며 "개정된 규정이 현장에 신속히 정착하도록 이해관계자와 소통을 확대하겠다"고 말했다.* This article has been translated by AI. 2026-07-30 12:04:10
  • Bank ETF Trust Sales Surge Ninefold in Five Months; Financial Supervisory Service to Revise Fee Structure
    Bank ETF Trust Sales Surge Ninefold in Five Months; Financial Supervisory Service to Revise Fee Structure The Financial Supervisory Service (FSS) has issued a consumer alert regarding the rapid increase in bank sales of exchange-traded fund (ETF) trusts and is initiating improvements to the fee structure, internal performance evaluations, and overall sales procedures. This decision comes amid a rise in transactions among vulnerable investor groups, such as the elderly, where short-term trading and increased upfront fees have heightened consumer costs.According to the FSS, from January of last year to May of this year, the sales of ETF trusts by six major banks—KB Kookmin, Shinhan, Hana, Woori, SC, and NH Nonghyup—totaled 64 trillion won (approximately 103 million transactions). Sales in May alone reached 10.8 trillion won, an 8.8-fold increase compared to December of the previous year, which saw sales of 1.2 trillion won.The FSS stated that due to the rapid growth in ETF trust transactions, it has issued a consumer alert that encompasses transaction characteristics, consumer protection practices, and important consumer considerations.Additionally, the FSS has decided to comprehensively review the fee structure for trusts, including ETFs. This review will assess the appropriateness of the entire fee structure, including upfront and deferred fees, early termination fees, and trading fees, with the aim of reducing the financial burden on consumers.The FSS's move to improve the system is driven by the short-term nature of ETF trust transactions and the mismatch in the fee structure. Analysis by the FSS revealed that the average holding period for ETF trust investors from January of last year to May of this year was only 42 days. Furthermore, 94.6% of transactions involved sales within six months, with 37.9% being ultra-short-term trades occurring within ten days.However, the proportion of investors opting for upfront fees, which are disadvantageous for short-term investments, was found to be 91.7%. Upfront fees are charged once at the time of investment, while deferred fees are charged based on the holding period at the time of termination, making deferred fees more favorable for shorter investment periods. This has led to a counterintuitive situation in actual trading.The FSS analyzed that if customers had chosen the optimal fee structure based on their investment duration, the fees banks could have collected from January of last year to last month would have been around 54.5 billion won. However, the actual fees collected amounted to 394.8 billion won, which is 7.2 times higher.There has also been an increase in ETF trust transactions among vulnerable investor groups, such as the elderly. The average age of ETF trust investors is 59, with 29.9% of investors aged 65 and older.The FSS will also examine whether customer interests are adequately reflected in the bank trust sales process. Most banks incorporate customer investment return indicators into their key performance indicators (KPIs) related to trusts, and the FSS plans to discuss whether the formulas and weighting of these indicators are appropriate and to explore improvement measures.* This article has been translated by AI. 2026-07-30 12:04:10
  • Cyber Incidents Rise 19.5% in First Half of 2026 Amid AI Expansion
    Cyber Incidents Rise 19.5% in First Half of 2026 Amid AI Expansion The number of cyber incidents in the first half of 2026 reached 1,236, marking a 19.5% increase compared to the same period last year. This rise is attributed to security threats stemming from the expansion of generative artificial intelligence (AI) and the sophistication of software supply chains.The Ministry of Science and ICT (MSIT) and the Korea Internet & Security Agency (KISA) announced the findings on July 30, 2026, in their report titled '2026 Cyber Threat Trends in South Korea.'According to the report, KISA received 1,236 incident reports in the first half of this year, a 19.5% increase from the previous year, although this figure represents an 8.4% decrease from the second half of last year.Among the types of incidents, distributed denial-of-service (DDoS) attacks and ransomware infections saw significant increases. DDoS attacks totaled 373 in the first half of the year, a 56.7% rise compared to the previous year, making it the most significant increase among major cyber threats. Ransomware reports reached 145, an increase of 82 incidents from the first half of last year. Server hacking accounted for the largest share (39.4%) of all incidents, with 487 cases reported in the first half of 2026.The MSIT identified several key cyber threats, including: the sophistication of attacks due to the proliferation of generative AI, open-source supply chain attacks, DDoS attacks targeting domestic entities by international hacktivists, ransomware combined with data breaches, and personal information leaks through API and account theft. The ministry noted that as generative AI and AI agents become integrated into work systems, new security risks such as prompt injection, privilege misuse, and sensitive information leaks are increasing. It also warned that the theft of developer accounts and supply chain attacks could spread across businesses.Additionally, the report highlighted ongoing threats from international hacktivist DDoS attacks, double-extortion ransomware, and personal information leaks exploiting API vulnerabilities and reused account information. The MSIT urged the implementation of multi-factor authentication (MFA) for APIs and accounts, enhanced software supply chain management, access controls for AI services, immutable backup operations, and regular incident response and recovery training.Choi Woo-hyuk, head of the MSIT's Information Security Network Policy Division, stated, "AI-based cyber threats are becoming a reality, and intelligent attacks targeting cloud vulnerabilities continue to emerge. The government will establish and operate a prevention and response system based on AI and take proactive measures to identify vulnerabilities."In response to the growing AI threats, the MSIT plans to develop a 'Cybersecurity AI Foundation Model.' Applications will be accepted until August 21, and selected development teams will receive support of 256 NVIDIA GPUs for ten months.* This article has been translated by AI. 2026-07-30 12:04:10
  • Population in Declining Areas Reaches High Levels in February
    Population in Declining Areas Reaches High Levels in February The resident population in areas experiencing population decline reached its highest level in February. The stay population exceeded four times the registered population, indicating active local engagement.On July 30, the National Data Agency announced the results of the 'First Quarter 2026 Resident Population Assessment,' revealing that the resident population in 89 declining areas across the country was 25.82 million in February, the highest for the quarter. Among this, the stay population was 20.98 million, approximately 4.3 times the registered population of 4.84 million.The resident population includes registered residents and foreign residents who stayed for more than three hours at least once a month. In February, the resident population increased by 5.6 million compared to the same month last year, although January and March saw decreases of 3.51 million and 250,000, respectively.Regionally, the resident population in February increased in all provinces compared to the same month last year, while January and March saw declines in most areas except for North Chungcheong and South Gyeongsang. The highest stay population ratios by district were recorded in Muju County, North Jeolla in January; Pyeongchang County, Gangwon in February; and Gurye County, South Jeolla in March. Busan's Dong District had the largest stay population across all three months.The average length of stay in declining areas was 3.5 days in both January and March, with February being the shortest. Most areas had a higher proportion of same-day stays, but Gangwon showed a preference for short stays, while metropolitan areas had a higher proportion of medium to long stays compared to other regions.In all areas, the stay population on holidays was greater than on weekdays, with February showing the highest ratio at 3.4 times that of weekdays. The concentration of same-day stays on holidays was also highest in February, with South Gyeongsang showing the highest ratio at 3.8 times that of weekdays nationwide.By type of stay population, short-term accommodation (tourism and leisure) had a higher proportion of women and individuals under 40, as well as residents from non-adjacent provinces. In contrast, commuting and studying types had a higher proportion of men and individuals aged 30 to 50, while long-term residents were predominantly men under 30.The ratio of foreign stay population averaged 2.1 times lower than that of domestic residents in the first quarter, but they tended to stay longer, with an average length of stay of 4.7 days and an average stay time of 14.5 hours.The average card spending per person in declining areas was 127,000 won in the first quarter, showing an increasing trend with age. For short-term accommodation, the highest average spending was in the healthcare sector, while commuting and studying types had significant expenditures in education and transportation, and long-term residents spent more on education and accommodation. The card spending of the stay population accounted for about 33% of total card spending, exceeding 47% in metropolitan declining areas.* This article has been translated by AI. 2026-07-30 12:04:10
  • Regulatory Overhaul for Pharmaceutical and Biotech Disclosures
    Regulatory Overhaul for Pharmaceutical and Biotech Disclosures The financial authorities are overhauling the disclosure system for pharmaceutical and biotech companies. The focus will shift from future value explanations, such as expectations of clinical success or large technology transfer contracts, to providing investors with concrete figures on success probabilities, development costs, and contract structures.On July 30, the Financial Supervisory Service (FSS) announced a comprehensive improvement plan for pharmaceutical and biotech disclosures aimed at enhancing reliability and investor understanding. The FSS operated a task force from April to June, involving external advisors and industry participants, to review securities registration statements, regular and interim disclosures, and media reporting methods.Initially, the FSS will standardize key assumptions used in pricing during the initial public offering (IPO) process. Going forward, pharmaceutical and biotech companies must specify four key items: expected market size, clinical trial success probability, regulatory review risks, and development timelines and costs.Previously, companies often relied on their own estimates for target market size or new drug value. Now, they will need to differentiate between the total market and the actual target market they can enter. Clinical success probabilities will also be based on objective data from research papers or existing statistics to minimize discrepancies in company estimates.Risks associated with the approval process will be disclosed separately. Even if clinical trials succeed, there is a possibility of delays or failures during regulatory reviews, allowing investors to identify related risks in advance.The disclosure system will also change post-listing. Currently, information is primarily provided on ongoing pipelines, making it difficult to see major developments such as past project terminations or technology transfers at a glance. To address this, a new 'Research and Development History Management Summary Table' will be established in regular reports to track the entire process, including completions, terminations, and approvals.If there are delays, companies will be required to explain the reasons and outline future plans.The method of disclosing technology transfer contracts will also be revised. Some companies have emphasized the signing of multi-billion dollar technology transfer contracts, but the actual contract amounts and future milestone and royalty conditions were often not clearly distinguished, leading investors to misinterpret the contract size as actual revenue.In the future, technology transfer contracts must be divided into contract amounts, development milestones, approval and sales milestones, and royalties, with each amount disclosed separately. Companies must also explain when and under what conditions these payments will be made. Even if the counterparty remains undisclosed, at least minimal information about the counterparty's size and business capabilities must be provided.Disclosures of clinical trial results will be improved to meet investor expectations. Instead of relying on technical jargon, companies will provide explanations of key terms and how to interpret the results to ensure general investors can understand them.Guidelines will also be established for how pharmaceutical and biotech companies communicate with the media. Important information that could influence investment decisions must be disclosed first, and subsequent media reports must align with the disclosed content. Adding unreported important information or using exaggerated or subjective expressions will also be restricted.Providing information exclusively to specific investors will be prohibited. The FSS plans to establish internal review procedures before distributing press releases and will recommend actions according to internal regulations in cases of guideline violations.An FSS official stated, “This improvement plan marks the first step in transitioning from a method where companies list information they want to convey to one that provides disclosures understandable to investors. We will continue to enhance the disclosure environment so that investors can assess growth potential and risk factors in a balanced manner.” The FSS will finalize the media reporting guidelines in consultation with the Financial Services Commission and the Korea Exchange, and will hold briefings for market participants to facilitate the implementation of the new system.This improvement plan comes in response to recent instances in the pharmaceutical and biotech sectors where clinical trial results or technology transfer scales were excessively interpreted, leading to confusion among investors due to discrepancies between company disclosures and media reports. Stock prices have surged significantly based on new drug expectations, but there have been cases where prices evaporated by over 90% when expectations for clinical results and development achievements fell short. Kolon TissueGene saw its stock price soar this year due to expectations for the U.S. Phase 3 trial of TG-C (formerly Invossa), but following the announcement of clinical results, the company's value was reassessed, leading to a decline of over 90% from its peak in May as of July 29. Similarly, Samchundang Pharm experienced a significant rise in stock price due to expectations for new drug pipelines like oral obesity treatments, but its stock price has since dropped nearly 90% from its early-year peak, highlighting the limitations of biotech stocks driven solely by expectations.* This article has been translated by AI. 2026-07-30 12:04:00