South Korea To Ease Regulations For Foreign Investment

South Korea plans to eliminate a number of regulations in the local stock market this year to make investment easier for foreign investors, according to the country's financial regulator, in an effort to attract more money to the market.

The Financial Services Commission stated in a statement that there is a significant disparity between current regulations and global standards, and that it will boldly improve regulations that have discouraged global investors from investing in our market.

The regulator announced the repeal of a three-decade-old rule requiring foreigners to register with authorities before trading South Korean stocks. Instead, they will be able to open accounts using an internationally recognised form of identification, such as a passport for individuals or a legal entity identifier (LEI) for businesses.

It will also repeal a rule requiring omnibus account holders, such as asset management firms and brokerages, to report on the transaction details of each final investor within two days of settlement, as well as open up most off-board trading to foreigners.

Meanwhile, according to the statement, South Korean listed companies will be required to provide corporate filings in English beginning in 2024, beginning with those of large size or with a high ratio of foreign shareholders.

The push comes as South Korea pursues inclusion in Morgan Stanley Capital International's developed market index. The global index provider currently classifies it as an emerging market.

The regulator intends to complete the necessary legislative revisions in the first half of this year in order to implement such changes by 2023.