In what cases is a corporate merger restricted?

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I've been running a corporation I established a few years ago, but business hasn't been doing well lately, and operations have essentially come to a halt. The company has more debts than remaining assets, so normal operations are impossible, and I'm considering liquidating the corporation. To register the dissolution of the corporation, do I need to clear all the debts first, or can I proceed with dissolution while debts still remain?

corporate merger

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作者: 김국일

Corporate mergers are generally permitted, but in certain cases, corporate mergers may be restricted or separate requirements must be met under the Commercial Act and special laws.

First, a company after dissolution can only merge if a continuing company is the surviving company, and mergers that substantially restrict competition in certain trade fields are prohibited under the "Monopoly Regulation and Fair Trade Act."

Also, a company in rehabilitation proceedings can only proceed with a merger if matters concerning the merger are stipulated in the rehabilitation plan, in accordance with the "Debtor Rehabilitation and Bankruptcy Act."

In addition, when a listed company (excluding special purpose acquisition companies) merges with an affiliated company, or when a listed special purpose acquisition company merges with another company, procedural restrictions apply, such as the obligation to report the merger to the Financial Services Commission within a certain period under the "Financial Investment Services and Capital Markets Act."

The detailed contents related to corporate mergers may vary in applicable laws and procedures depending on the company's financial status, governance structure, and industry characteristics, so case-by-case review is required.

Before actually pursuing a merger, it is desirable to confirm specific restrictions and procedures through consultation with a corporate M&A specialist attorney to prevent violations of related laws and post-risks.

For details, please consult with a corporate M&A specialist attorney.