[Consulting] Verifying the reporting procedure for granting overseas headquarters shares to employees

A company is an online advertising consulting startup headquartered in the United States with a subsidiary in Korea. A company has been providing shares of its U.S. headquarters as incentives to employees of its Korean subsidiary to enhance performance rewards and a sense of ownership in the company. In this process, A company recognized that when employees of its Korean subsidiary acquire overseas shares, they must report securities acquisition to the Bank of Korea, and inquired to Law firm Veat about the procedures for securities acquisition reporting.

Law firm Veat conducted a review of relevant laws and regulations, comprehensively considering the number of company shares paid to employees of the Korean subsidiary, the price, the ratio to the total number of shares from the U.S. headquarters, etc. As a result, it was confirmed that the company’s share issuance falls under an exception that does not require separate securities acquisition reporting, and it was possible to review conditions under which such an exception would not apply. Based on Law firm Veat’s opinion, A company was able to provide shares to employees without a separate reporting procedure, and it was confirmed that monitoring is needed to determine whether the conditions under which the exception would not apply are met, and to perform the reporting procedure if necessary.

Thank you.

Law firm Veat