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Recommended #govt-KEPCO bond act

(LEAD) National Assembly approves bill to raise ceiling on debt-ridden KEPCO's bond issuance

20:50 December 28, 2022

(ATTN: ADDS details about other bills in last 7 paras)

SEOUL, Dec. 28 (Yonhap) -- The National Assembly on Wednesday approved a legal revision meant to raise the ceiling on bond issuance by money-losing state-run Korea Electric Power Corp. (KEPCO) in order to prevent a liquidity crisis at the firm and ensure stable power supply.

The partial revision allows KEPCO to raise its bond issuance ceiling by two to five times the sum of its equity capital and reserves.

In times of particular financial difficulties, KEPCO can issue bonds up to six times the current ceiling. In such case, the firm must seek approval from the industry minister, who then is obliged to immediately report the issuance to the related committee of the National Assembly.

The bill garnered 166 votes at the plenary session of the National Assembly, along with nine opposition and 24 blank votes.

The revised law is effective until Dec. 31, 2027.

The bill was first rejected on Dec. 8 mainly due to opposition from lawmakers of the main opposition Democratic Party who argued that raising the ceiling is not a fundamental solution to the company's liquidity crisis.

But the bill passed in a renewed attempt on Wednesday amid concerns that electricity charges could increase at least three fold next year without a revision and consensus that there is no easy solution to KEPCO's longstanding liquidity problem.

Lawmakers vote on a revision to the state-run Korea Electric Power Corp. (KEPCO) Act during a plenary session of the National Assembly in Seoul on Dec. 28, 2022. (Yonhap)

KEPCO has been struggling with huge losses on high fuel costs and limited electricity rate hikes.

According to the revised law, the industry ministry and KEPCO also must keep down the amount of bond issuance and try to improve its financial conditions, in relation to the new bill's impact on the country's economy and financial market.

Along similar lines, the revised act also allows another state-run energy firm Korea Gas Crop. (KOGAS) to raise the ceiling of its bond issuance up to five fold.

Also on Wednesday, the National Assembly unanimously passed an anti-stalking law, aimed at preventing stalking and supporting victims and people who help them.

The anti-stalking law was inspired by the tragic stalking murder of a female Seoul Metro employee by a male colleague in September.

The act clarifies an act of stalking as a crime. If convicted guilty, perpetrators can face up to three years of confinement or 30 million won (US$23,650) in fine.

South Korean parliament also okayed a new bill that designates the southwestern province of North Jeolla as the country's fourth special self-governing region. Other three such entities include Gangwon Self-Governing Province, Jeju Self-Governing Province and Sejong Self-Governing City.

One year after the bill gains additional approval from the Cabinet and the president, North Jeolla Province will be entitled to higher level of self-governing administrative authority, such as in forging social contracts, international cooperation and partnerships with public firms.

Another major bill that passed parliament the same day was one that enables the South Korean government to enforce suppliers to produce goods or services in case of national disaster.

The act is intended to prevent social unrest, particularly in light of the shortages of facial masks during the pandemic and of urea solution, a key fluid used in diesel vehicles to cut emissions, that swept the country late last year due to China's export curbs.



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