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Q

I am curious about the representative types of unfair trading.

Legal IntellectualViews4,173

Recently, in the course of stock trading, I encountered circumstances that appear to be unfair trading, but it is difficult to judge whether it exactly constitutes such a matter, so I am making an inquiry. It is difficult to write down the specific details.. It would be helpful if you could briefly explain just the representative types of unfair trading, such as the use of undisclosed information or market manipulation. If there is an attorney in the field related to unfair trading, I would appreciate your advice.

unfair trading

A

Answer to Related Inquiry

Whether something constitutes unfair trading is judged according to the content and circumstances of the act, so it is important first to accurately understand the concept of unfair trading and its representative types.

An unfair trading act refers to any securities transaction act that fails to perform the various obligations required under the 「Financial Investment Services and Capital Markets Act」, or that obtains improper gains by deceiving the counterparty or the market.

It is distinguished from a mere failure of investment judgment, and where illegality is recognized, it becomes subject to administrative·criminal sanctions.

The representative types of unfair trading are as follows.

Use of undisclosed material information: an act in which an insider of a listed company, among others, trades stocks using material information that has not been disclosed

Market manipulation: an act of artificially raising or lowering the stock price through means such as fictitious trading or matched-order trading

Fraudulent trading: an act that impedes investors' reasonable judgment through means such as spreading false facts or concealing material facts

Short-swing profit trading: an act in which officers·major shareholders, among others, repeatedly trade within a short period to gain a profit

Violation of disclosure·reporting obligations: a case of failing to perform statutory disclosure·reporting obligations, such as large-holding reports and insider trading reports

Market disruption: a trading act that repeatedly·systematically obstructs the fair formation of market prices

Whether the act you discovered constitutes one of the above types of unfair trading, or overlaps with multiple types, must be judged by combining the specific transaction structure and the facts.

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