South Korea unveils new guidelines to boost foreign investor entry into stock market

SEOUL, November 27 (AJP) - South Korea’s Financial Services Commission (FSC) on Thursday unveiled new guidelines for foreign omnibus accounts, aiming to streamline market access for overseas investors and attract additional capital inflows.

Omnibus accounts allow foreign institutions to trade and settle Korean equities without opening individual accounts for each client — a structure similar to how South Korean investors trade U.S. stocks. The country’s first such account was launched in August, eight years after the system was first introduced.

The updated guidelines provide detailed procedures for account opening, allocation of shareholder rights, and mandatory reporting. They also establish internal control standards designed to prevent market abuse and money laundering by foreign financial investment firms.

The FSC said the guidelines will be translated into English and distributed to market participants. A corresponding revision to financial investment business regulations — removing restrictions on which entities can open omnibus accounts — is expected to be completed in December.

The regulatory overhaul will enable small and mid-sized foreign securities firms and asset managers, previously excluded unless granted special exemptions, to access the system.

“We expect this to improve foreign investors’ access to the domestic stock market and stimulate capital market activity by attracting new investment funds,” the FSC said in a press release.

* This article, published by Aju Business Daily, was translated by AI and edited by AJP.

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