South Korea plans to relax restrictions on foreign investment in telecom operators as part of free-trade agreements with the US and the EU.
At the moment foreign telecoms investments are capped at 49%, but the plan would allow full foreign…
South Korea plans to relax restrictions on foreign investment in telecom operators as part of free-trade agreements with the US and the EU.
At the moment foreign telecoms investments are capped at 49%, but the plan would allow full foreign ownership.
However, the rules will not apply to outside investors wishing to takeover wireless incumbents SK Telecom, KT Corp and LG Uplus Corp, The Wall Street Journal reported citing an official at the Ministry of Science, ICT and Future Planning.
Foreign investors will only be allowed to acquire minor operators in mobile and fixed-line, and will be required to set up a local vehicle to hold the stake in.
The liberalisation bears some similarity to a change in Canada’s investment laws last summer which allowed outside investors to own 100% of companies with a maximum of 10% of market share by revenue.
Meanwhile India has recently done away with its 74% ceiling for foreign direct investment in telecoms with the aim of bolstering operators’ balance sheets.
