[EDITORIALS]Leave Business AloneThe temperature is rising in the debate between the government and the business sector and the ruling coalition and the opposition over desirable corporate forms and how and how much business should be regulated. Following earlier requests to repeal or alleviate regulations applied to the top 30 business groups, the business sector is expected to present to the government with a 59-item list of regulations that it wants lifted, including raising the ceiling of overseas financing. It is also expected to prepare separate recommendations for reform of tax and antitrust regulations. The opposition Grand National Party went a step further and began criticizing the government's chaebol reform policy.
The government, for its part, appears to be distinguishing its policy on corporate structure from management activities. It is more open to suggestions that concern management activities, but has been firm on reform policies on corporate structure. The restriction on equity ownership by the top 30 groups in affiliated companies is one policy the government has said will not be changed. On the other hand, loosening the requirement such as maintaining a 200 percent debt-equity ratio and lifting restrictions on international trade finance will be considered and accepted selectively, the government said.
We believe those regulations that concern business activities must be lifted unequivocally, not selectively. Government policy on corporate structural reform must also be reviewed. The government must guarantee corporations the right to act freely in business, and decisions on corporate structure must also be left up to the companies themselves. Regulation runs directly against the entrepreneurial spirit.
The government's role should be that of an impartial umpire. Issues of corporate structure must be resolved through the workings of the market and laws that improve corporate governance and management transparency. The business publication Forbes recently picked Korea as one of the most difficult places to do business, worse than competitor Asian countries such as Singapore, Taiwan, and even China. It is time for the government to resolve the difficulties that business face without delay.