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Rival parties reach compromise on revision of Commercial Act

July 2, 2025

The ruling Democratic Party (DP) and the main opposition People Power Party (PPP) on Wednesday reached a compromise on a revision of the Commercial Act, raising hopes that the revised bill would be approved at the National Assembly this week.

The DP has been pushing to amend the act to expand the fiduciary duty of corporate board members to all shareholders, in what many analysts say is a move to improve corporate governance, but the PPP had opposed a rule restricting the voting rights of a company’s top shareholder.

The rival parties had clashed over the rule that would limit the voting rights of the largest shareholder in a company to 3 percent when an auditor is being selected, but agreed to put the bill to a vote after making amendments to the rule.

The two parties will also agree to hold a public hearing to address other contentious issues of the revised bill, including a provision related to a cumulative voting system.

Rep. Jang Dong-hyeok of the PPP told reporters that an agreement between the rival parties on the revised bill would be an “even more positive” message to the capital and stock markets.