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Compliance Checklist for Anti-Corruption

Compliance Letter

Sang-Joon Park / Compliance Officer

Compliance to anti-corruption laws is not a discretion, but a strict legal obligation.

The Improper Solicitation and Graft Act, which is better known to us as the Kim Young-ran Act, has been in effect since September 28. The law prohibits improper solicitation and money transfers to public officials. We must meet our standards of conduct for this purpose of legislation. In this article, I would like to explain the Act for directors and employees of the company.
As the name implies, this law regulates i) the prohibition of improper solicitation to public officials and ii) the prohibition of providing money for public officials.

Improper solicitation is punished by itself regardless of whether the solicitation is realized or not

First, improper solicitation refers to asking public officials to violate the relevant laws or to handle the affairs outside the status and authority. In this case, if a party makes an affirmative appeal directly to a public officials, the party is not punished, but a public officials who has been asked to do so is punished. However, in the event of improper solicitation through a third party, the person concerned, third party and public officials are all punished. A request made by the Company's directors and employees shall be punished as a third-party request, not as a request by the party. In particular, whether or not the solicitation affected or realized the actual performance of the public official's job, it is punished by the act of improper solicitation itself.

If you offer the financial or other advantages, you will be penalized regardless of whether you are benefiting.

Next, the company's directors and employees shall not provide any money to the public officials in connection with their duties, at which time the consideration will not be questioned. Furthermore, a person shall be punished with criminal penalties if he provides money that exceeds 1 million won at a time or exceeds 3 million won in fiscal year total, regardless of any connection to their duties and regardless of any pretext such as donation, sponsorship, gift, etc. On the other hand, there is no penalty provision for providing money of less than 1 million won at a time and less than 3 million won in each fiscal year, if not related to the duties of public officials. However, we must recognize that the courts have a very wide range of the duties of public officials.
In exceptional cases, however, any of the following shall be allowed to offer to the public officials: ① food, the value of which is less than 30,000 won, gift, the value of which is less than 50,000 won, congratulatory or condolence money less than 50,000 won for purposes of social relationships, rituals, or aid ② money, goods, etc., provided uniformly in a normally accepted range by an organizer of an official event related to the duties of a public officials, etc. to all participants thereof, in the form of transportation, accommodation, food and beverages, etc. ③ souvenirs, promotional goods, etc. to be distributed to multiple unspecified persons, or awards or prizes given in a contest, a raffle, or a lottery. However, it should be noted that the public officials who is directly involved in the job are not allowed to be provided with the money of 30,000 won and 50,000 won as described above. No person shall offer, promise to offer, or express any intention to offer any prohibited money, goods to any public officials or to his/her spouse.

Anti-corruption laws also apply to people other than public officials.

In addition, the public officials who are subject to the Act include employees who work in government offices, public institutions, schools and media companies. Public affairs organizations or public institutions include various state-owned enterprise, researchers, technicians, associations, committees, and national and public hospitals. Therefore, it is necessary to carefully examine whether the other party is a public officials.

Keep in mind that if employees violate the law, the company is also punished.

On the other hand, even if a company employee has a personal relationship with a public officials or a journalist, the company is also punished by law when providing money or improper solicitation. In addition, the profits from the violation of the law are unfair and can be fully recovered by the relevant authorities. Therefore, special attention should be paid to the relationship with the public officials.

An improper solicitation or offer of money must be declared by the public officials.

It should not be misunderstood that a violation of the law will not be a problem or an idea that it will be 'okay' or 'okay' due to the practices, recognition(humanity), and relationship during that time. Because the law provides for a well-prepared reporting system for the public officials. In other words, the public officials are not only motivated to voluntarily report complaints and immunity regulations, but also protect and compensate for other complainants. As the money provider may change their mind and report at any time, it is a reasonable choice to refuse to accept any money or to report voluntarily in the public office.

All employees should act on a higher ethical standards

There are still a lot of controversies about the various requests of public officials and the provision of money, but it is often difficult to judge whether violation of the law is clear. However, there is a greater legal risk if you try to keep the baseline of the law in breach without radically correcting existing practices. Therefore, if there is any suspicion of violation of the law, it is necessary to act on the basis of strict judgment as 'one more step' than the law.

The company applies the principle of zero-tolerance for anti-corruption law violators

The company has already declared through its Code of Ethics and CEO Message that it will apply the principle of zero tolerance to all directors and employees who violate anti-corruption laws. Furthermore, the company makes it clear that it can not justify violations of laws and codes of ethics because of the company's profit or revenue targets.
If you do not adhere to the anti-corruption laws, keep in mind that all directors, employees and company can be punished easily, and all directors and employees should be fully aware of the laws and have high ethical standards.