- KRX to review tech-listed firms for delisting if they change core businesses within five years.
- Digital asset treasury business shifts may lead to delisting reviews under revised KRX rules.
- Special-listed firms must disclose value enhancement plans during delisting grace periods.
The Korea Exchange (KRX) has introduced new listing rule changes that tighten oversight of companies that entered the KOSDAQ market through the technology special listing program.
Under the revised framework, companies that change their core business within five years of listing could face a serious delisting review, a move that directly affects firms seeking to transition into digital asset treasury or investment operations after securing a market listing based on technological qualifications.
New Delisting Trigger Targets Core Business Changes
The KRX announced that it has revised its Listing Regulations and Enforcement Rules as part of broader measures aimed at strengthening confidence in the KOSDAQ market and improving the capital market’s structural framework. The revisions also include changes related to companies with multiple voting rights shares.
Among the key amendments, technology companies listed through the special listing program will become subject to substantive delisting reviews if they change their primary business purpose within five years after listing. The rule applies when a company adds or modifies its business objectives through amendments to its articles of incorporation.
According to the exchange, businesses that remain similar to the company’s existing primary operations or qualify as incidental activities will not fall under the new review process.
Digital Asset Treasury Example Cited
To explain the change, the KRX referred to a biotechnology company that was listed under the technology special listing program last year. According to the exchange, the company later transferred management rights to an overseas business associated with digital assets and changed its primary business into a digital asset investment company.
The KRX said such a transition removes the technological capabilities and growth potential that originally formed the basis of the company’s special listing eligibility, making a substantive review necessary.
Disclosure Requirement Added During Delisting Grace Period
The revised regulations also modify the treatment of companies that receive temporary exemptions from delisting requirements, including revenue thresholds and large-scale loss standards.
Previously, companies listed through special provisions automatically received a three- to five-year grace period because their listings were based on future growth potential. Under the updated framework, those companies must now disclose corporate value enhancement plans during the exemption period.
The exchange said the disclosure requirement is intended to help companies communicate their future growth prospects to investors while the deferred delisting standards remain in effect.
In addition to these measures, the KRX expanded customized qualitative evaluation standards for innovative companies, established a framework for disclosures by low price-to-book ratio companies, and revised rules governing multiple voting rights shares.
Related: Bithumb Eyes Nasdaq Listing After Dropping KOSDAQ IPO
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