Rho, Hyeok-Joon --- "New Squeeze-out Devices as a Part of Corporate Law Reform in Korea" [2012] ELECD 869; in Kim, Hwa-Jin (ed), "Korean Business Law" (Edward Elgar Publishing, 2012)

Book Title: Korean Business Law

Editor(s): Kim, Hwa-Jin

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781781003398

Section: Chapter 3

Section Title: New Squeeze-out Devices as a Part of Corporate Law Reform in Korea

Author(s): Rho, Hyeok-Joon

Number of pages: 25

Extract:

3. New squeeze-out devices as a
part of corporate law reform in
Korea*
Hyeok-Joon Rho

I. INTRODUCTION

When the incorporated entity first emerged, the operation of the corpora-
tion was based on mutual agreement among its shareholders.1 Because the
charter was viewed as a contract among shareholders,2 the management of
the corporation was subject to consensus among its shareholders.3 Thus,
the nineteenth-century corporate law effectively allowed all shareholders
a veto right whenever their corporation wanted to amend its charter or
to adopt fundamental changes in its operation.4 A veto right, however,
turned out to be an easy tool for minority shareholders to use to block a


* This chapter is based upon an article by this author published in the Boston
University International Law Journal (29 B.U. Int'l L. J. 41, 2011). For more
domestic squeeze-out issues in Korea, including the detailed method of appraisal,
readers may refer to the author's other paper in Korean: Hyeok-Joon Rho,
Sosoo-Jooju-Chuckchul-Jedoeu-Doipae-Kwanhan-Yeongoo [Imminent Adoption of
Squeeze-out Devices in Korea: What Should be Considered for Balancing Majorities
and Minorities?], 26 Com. L. Rev. 231-71 (2008).
1 In other words, shareholders in a corporation would stipulate to their rights

and obligations, the governance of the corporation, and other material terms on
management in the corporate charter and then operate the corporation pursuant
to that charter.
2 See Elliott J. Weiss, The Law of Take Out Mergers: A ...