Democratic Party passes bill in judiciary committee to bar presidential pardons for insurrectionists

The Democratic Party of Korea on the 20th unilaterally advanced and passed in the Legislation and Judiciary Committee’s Subcommittee on Bills a revision to the Amnesty Act that would restrict the president’s special pardon power in cases such as insurrection and foreign-aggression crimes, as well as a third revision to the Commercial Act that would, in principle, mandate the cancellation (retirement) of treasury shares held by companies. Lawmakers from the People Power Party who sit on the committee protested, saying, “The Democratic Party is running amok with legislation.”

The third Commercial Act revision, which was taken up first and passed by a vote in the subcommittee, stipulates in principle that when a company acquires its own shares (treasury stock), it must cancel them within one year. It also requires that, once a year, the shareholders’ meeting decide on a plan for disposing of treasury shares, and that extensions of the cancellation deadline or changes to the method of holding or disposing of such shares be allowed only by a shareholders’ meeting resolution, not by the board of directors. The key point is that decision-making authority related to treasury shares is expanded and shifted to shareholders.

The Democratic Party believes that if treasury shares are cancelled, the number of shares in circulation will decrease, which would increase earnings per share (EPS) and thereby support the stock price. After the bill passed, Oh Ki-hyung, chair of the Democratic Party’s “Korea Premium K–Capital Market Special Committee,” told reporters, “Regardless of whether one is progressive or conservative, we have reflected on institutional reform from a sense of purpose aimed at modernizing the capital market and making it more innovative and dynamic.”

People Power Party lawmakers who voted against the Commercial Act revision argued that treasury shares acquired involuntarily for unavoidable reasons—such as corporate mergers and acquisitions (M&A)—should be excluded from the mandatory cancellation requirement, but this was not accepted. Jo Bae-sook of the People Power Party said, “The Democratic Party pushed through the Commercial Act revision as if conducting a military operation. There wasn’t an in-depth review of the problems companies could face.”

After the vote on the Commercial Act revision, when the Democratic Party immediately moved to process the Amnesty Act revision, People Power Party members of the committee left the meeting room and held a press conference. Na Kyung-won of the People Power Party protested, saying, “The pardon power is the president’s exclusive constitutional authority, so this is an unconstitutional destruction of the Constitution,” and “In effect it also has the aspect of targeting a specific person, which is likewise unconstitutional. If this is the approach, then it would be right to define President Lee Jae-myung’s crimes as subject to a pardon ban as well.”

However, the Democratic Party pushed ahead and passed the Amnesty Act revision. The bill, as passed, in principle prohibits the president from exercising pardon power for crimes of insurrection and foreign aggression, but includes a proviso allowing a pardon if more than three-fifths of the total members of the National Assembly consent. After the bill passed, Kim Yong-min, the Democratic Party lawmaker serving as chair of the Legislation and Judiciary Committee subcommittee, said, “The National Assembly and the government have clearly shown their determination not to pardon insurrectionists,” adding, “This is an expression of the will to cut off the shoots of future insurrectionists.” The Democratic Party plans to put both bills on the agenda at the full Legislation and Judiciary Committee meeting on the 23rd and process them, and then bring them to a plenary vote by no later than the 24th.