Legal Issue 1.
Antitrust/C&F/HR Issue Update
Successful Joint Efforts by Yulchon's Antitrust/Corporate & Finance/HR Specialists
Yulchon's Antitrust, Corporate & Finance, and HR Lawyers Advise
GSK in Its Global Three-Part M&A Transaction with Novartis
Yulchon provided comprehensive, multi-disciplinary advice to its global client GlaxoSmithKline plc (GSK) to help complete its complicated global three-part pharmaceutical M&A transaction with Novartis. Yulchon's expert advice on the Korean portion of the transaction spanned from antitrust merger clearance to corporate M&A advice to HR guidance. Remarkably, GSK's two different global coordinating counsel for three different disciplines all relied on Yulchon as their Korean local counsel of choice. In the process, Yulchon demonstrated once again its superb capabilities to handle the most complex and highest-profile matters alongside elite global law firms that handled the foreign portions of this transaction.
Valued at well over $25 billion just accounting for two of its three-part deal structure, this transaction was one of the biggest and most closely watched pharmaceutical deals announced in 2014. More specifically, the overall transaction involved three distinct interrelated components: (1) GSK's acquisition of Novartis' vaccine business for $7 billion; (2) GSK's formation of and obtaining control of a newly formed consumer healthcare joint venture with Novartis with a book value of over £6.5 billion in 2013 sales; and (3) Novartis' acquisition of GSK's cancer drug business for $16 billion.
Antitrust Advice – Obtaining Unconditional Antitrust Merger Clearance from KFTC
Regarding the antitrust merger clearance task, given its global nature, the transaction required merger filings with antitrust enforcement agencies in some 18 separate jurisdictions. As GSK's Korean antitrust counsel, Yulchon prepared and filed merger notification reports with the Korea Fair Trade Commission (KFTC) in connection with the first two components and also assisted GSK in working with Novartis' Korean counsel that handled the filing for the third component.
This three-part "business swap" deal between GSK and Novartis has been hailed as an "innovative" game changer for M&A by some commentators. Of course, this is certainly not the first "business swap" deal between two competitors occupying the same sector. In the early 1990's, DuPont and ICI swapped their "nylon" and "acrylic" businesses so that each can concentrate better on their true core strengths. But it has been a while since two companies in the same sector successfully swapped their diverse business lines.
Because of the "swap" nature and multi-components of the overall transaction, it was all the more difficult and complicated even to explain to the KFTC the structure of the deal, who is acquiring what from whom, and the like. We took the necessary time to educate the KFTC as part of our front-end work and run some ideas in advance of formally filing merger notification forms. In the end, this approach helped reduce the KFTC's review time.
To avoid undue delays, we carefully examined all of the potentially relevant substantive issues and strategically decided what areas to focus first and what to save for later discussions. After establishing a proper context, we were able to process a large amount of information and managed to direct the KFTC's attention to truly important issues.
Among other things, we had to handle the market definition issue carefully and delicately. While starting the initial market definition discussions based on the globally accepted active drug ingredients categorization, the ATC (Anatomical Therapeutic Chemical) classification system, we convinced the KFTC to further fine-tune market delineation by also considering intended drug usage, efficacy and existence of alternatives and substitutes. As a result, we succeeded in establishing that, despite the size and complexity of the overall transaction, there were only few overlaps in Korea and even then they did not raise significant competitive concerns.
This transaction shows that careful upfront planning is a must and goes a long way to reduce overall review time and avoid unnecessary confrontations or debates with the KFTC. Undoubtedly, each jurisdiction requires a somewhat different approach. Yet, close coordination with GSK's global coordinating antitrust counsel, GSK's counsel for some of the major jurisdictions as well as Novartis' global and local antitrust counsel was absolutely crucial and successfully achieved even though it was difficult and time-consuming to harmonize all their views at times.
Utilizing our extensive experience in handling merger matters before the KFTC, coupled with our unique international antitrust capability and sensitivity to potential issues and developments in other jurisdictions made possible by Cecil Saehoon Chung, our head of international antitrust team who was a former U.S. FTC attorney and antitrust partner at two global law firms in Washington, D.C., Yulchon was confident to chart its clearance strategy and delivered the best possible outcome. In the end, we exceeded the client's expectations by securing "unconditional" antitrust merger clearance in Korea ahead of the client's target clearance date and also ahead of clearance in other major jurisdictions.
As Korea and other emerging jurisdictions in Asia become even more important in the global M&A area, merging parties will have to have a clear game plan to secure clearance with the least amount of delays and complications. This GSK/Novartis transaction shows that, with right local counsel in Korea with the requisite experience and expertise before the KFTC and sophistication necessary to coordinate seamlessly with global coordinating counsel and counsel for major jurisdictions, global companies need not worry about the Korean merger control regime becoming a bottleneck. Instead, with right local counsel in Korea, global deal makers may even expect Korea to lead the way and help assuage other jurisdictions.
For this antitrust merger clearance task, senior foreign counsel Cecil Saehoon Chung and Seuk Joon Lee took the lead with able assistance from partner Kyu Hyun Kim, associates Woo Yul Lee and Jun Woo Cheong, and foreign attorneys Tae Yong Kim and Young Jo Lee.
Corporate & Finance Advice – Providing Various Corporate M&A and Regulatory Advice
Yulchon's Corporate & Finance Group represented GSK on all transactional, regulatory and closing aspects of the transaction in Korea to consummate and implement the (i) formation and establishment of the Korean consumer healthcare joint venture; (ii) transfer of the consumer healthcare business from GSK Korea and Novartis, respectively, to the consumer healthcare joint venture company; (iii) purchase of Novartis Korea's vaccine business by GSK Korea; and (iv) sale of GSK Korea's cancer drug business to Novartis Korea.
More specifically, Yulchon's Corporate & Finance Group advised GSK on a wide range of legal issues, including (a) regulatory compliance for the transfer of all licenses and permits under the Pharmaceutical Act; (b) foreign exchange regulations and controls; (c) foreign investment and foreign exchange transaction matters under the Foreign Investment Promotion Act and the Foreign Exchange Transaction Act; (d) labor law matters; and (e) general tax advice.
By successfully handling the Korean corporate M&A portion of this global transaction, Yulchon has shown once again its unmatched level of expertise on innovative M&A transactions in general and in the healthcare industry in particular.
Corporate & Finance partner Ki Young Kim, who is also co-head of Yulchon's Healthcare Team, led the Corporate & Finance advisory team's efforts, along with partner Hyun Suk Jin, senior foreign counsel Raymond M. Kang, senior associate Jin Wook Lee and foreign attorney Richard D.H. Han.
HR – Advising on Korean HR Issues
Yulchon's HR team worked closely with GSK's global HR counsel and local GSK staff in Korea, to provide counselling on Korean labor law issues arising from the transaction, including analysis of various options for transferring employees in phases such as secondment or via transition services agreement, employee consent requirements, and more.
Yulchon's HR Team partner Sang Wook Cho, senior foreign counsel Soojung Lee, associate Jae Woo Park and foreign attorney Christopher Mandel handled the HR issues.
Legal Issue 2.
IP Issue Update
Patent Covering Method of Use for Viagra Confirmed Invalid by the Korean Supreme Court
On April 23, 2015, the Korean Supreme Court upheld a High Court decision confirming the invalidation of KR Patent Reg. No. 10-0262926 ("KR'926"), a patent covering a method of use for Viagra, Pfizer's global blockbuster drug for treatment of erectile dysfunction. The composition of matter patent covering Viagra, KR Patent Reg. No. 10-0078931, was filed on June 19, 1991 (claiming priority to GB 9013750 filed on June 20, 1990) and expired on May 18, 2012 with a patent term extension of 10 months and 28 days. The original invalidation action against KR'926 was initiated by CJ, Hanmi Pharmaceutical and six other Korean pharmaceutical companies.
"Viagra" is the trade name for "sildenafil," which was initially developed for treating high blood pressure but was unexpectedly found to be effective for treating erectile dysfunction. Viagra's positive effects on erectile dysfunction were only discovered after Viagra was developed as a vasodilator, and the method of use patent application was filed in Great Britain on June 9, 1993, almost 3 years after the filing date of the composition of matter patent. The method of use patent KR'926 issued from KR Appln. No. 10-1999-7001541 filed on February 20, 1999, which was a divisional application of KR Appln. No.10-1995-7005553 filed on December 8, 1995 and claiming priority to PCT/EP94/01580 filed on May 13, 1994 and GB 9311920 filed on June 9, 1993.
The specification of KR'926 identifies sildenafil as one of nine compounds used for erectile dysfunction treatment. However, the specification of KR'926 did not disclose any in vitro pharmacological data or experimental results specifically directed to sildenafil. In particular, the specification of KR'926 identified nine chemical compounds including sildenafil as "[e]specially preferred individual compounds" at pp.7-4 - 7-5 as follows:
The compounds of the invention have been tested in vitro and found to be potent and selective inhibitors of the cGMP-specific PDEV [in reference to the predominant PDE in human corpus cavernosum tissue]
Thus relaxation of the corpus cavernosum tissue and consequent penile erection is presumably mediated by elevation of cGMP levels in the said tissue, by virtue of the PDE inhibitory profile of the compounds of the invention.
In man, certain especially preferred compounds have been tested orally in both single dose and multiple dose volunteer studies. Moreover, patient studies conducted thus far have confirmed that one of the especially preferred compounds induces penile erection in impotent males.
All parties argued extensively over whether such a disclosure could be acknowledged as a test example or a concrete description that could replace the test example.
The Korean Supreme Court stated that a method of use invention of a pharmaceutical product requires disclosure of pharmaceutical efficacy. If there are no special circumstances, such as pharmaceutical efficacy clearly known before the patent application, the description requirement could be satisfied by disclosing test examples showing pharmaceutical efficacy data for a specific compound or by providing a concrete description that could replace the aforementioned test example.
Furthermore, where the method of use invention requires disclosure of pharmaceutical efficacy and where there is neither pharmaceutical efficacy data for a specific substance nor a concrete description in the specification, a supplementing revision would not be permitted for violating the scope of such a description. The decision confirmed the precedent that an insufficient description cannot be corrected without losing the claim for priority to the originally filed documents.
Ultimately, the Court held that it was unable to find sufficient support for a method of treatment for erectile dysfunction when examining the originally filed specification, because the specification lacked information typically required for medical treatment, e.g., dosage range, administration method, scope of the target group, evaluations of the erections, and medical state of patients before and after erection. In addition, the Court held that it is unclear from the specification whether the one especially preferred compound identified as inducing penile erection in the in vitro test is actually sildenafil. Thus, the Court held that there was neither pharmaceutical efficacy data for a specific compound nor a concrete description.
Lessons and Implications
This case clearly illustrates the importance of the sufficient written description requirement. The Korean Supreme Court views patent specifications as scientific and technical documents that must support the full scope of the claims, including claims directed to a method of use or a method of treatment. As a result of the court decision, all pharmaceutical companies are now free to supply generic versions of Viagra. In particular, generic drug manufacturers may now use the sufficient written description requirement as another potent legal basis for invalidation in patent challenges. Such patent challenges have dramatically increased after the March 2015 effective date of the Korean Drug Approval – Patent Linkage System, which is the Korean version of the US Hatch-Waxman Act. The Korean Drug Approval – Patent Linkage System provides the incentive of generic exclusivity to the first company that invalidates a listed patent or receives a determination that its generic product is outside the scope of a listed patent, also known as negative patent scope trials.
Legal Issue 3.
Real Estate & Construction Issue Update
The Development Project in Jeju involving Foreign Investments under Threat of Suspension
In 2001, the Korean government devised a plan to develop Jeju Island as a free international city geared towards the tourism, resort and service industry, and in relation to such plan, the Korean government selected and approved seven large size development projects in Jeju Island. One of such development projects is Yerae Resort-type Residential Complex development project (such complex, the "Residential Complex", and such project, the "Project") and even though approximately KRW200 billion has already been committed to the Project to complete 55% of the construction works for Project, the Project has come under threat of suspension due to the Korean Supreme Court's ruling confirming a lower court's decision that one of the governmental permits and licenses granted in connection with the Project was not valid.
Since the aforementioned case is a clear example showing how important it is to confirm the validity of governmental permits and licenses granted with respect to a development project, we will briefly describe below the current status of the Project and its implications for foreign investors.
I. Factual Background
In 2005, after obtaining required governmental permits and licenses for the Project which included a governmental license for establishment of an amusement park (such license for establishment of an amusement park, the "Governmental License") from Seogwipo City Government in Jeju Special Self-governing Province, Company A proceeded with the Project. In 2008, Company A attracted foreign investment from Company B with respect to the Project. Company A and Company B incorporated Company C as a joint venture company, and Company A transferred its status as the project developer and rights and obligations related thereto to Company C. Consequently, Company C is currently in charge of the Project as the developer of the Project.
Although Company A attempted to purchase land sites for the Project, it failed to reach mutual agreement with certain land owners (the "Land Owners"). Around the end of 2006, Company A purchased the land sites owned by the Land Owners compulsorily pursuant to the land expropriation decision of the Local Land Tribunal of Jeju Special Self-governing Province in accordance with the Korean laws relating to land expropriation (the "Expropriation Decision"). However, in 2007, the Land Owners filed a formal objection against the Expropriation Decision in the Central Land Tribunal, but the Central Land Tribunal dismissed such objection. After the dismissal, the Land Owners filed a claim in the local court against Company A and the Local Land Tribunal of Jeju Special Self-governing Province requesting nullification of the Expropriation Decision. In 2009, the trial court ruled against the Land Owners, but in 2011, at the appellate level, the appellate court ruled in favor of the Land Owners. In 2015, the Supreme Court of Korea rendered a final judgment in favor of the Land Owners confirming the appellate court's decision (the "Final Decision").
Pursuant to the Final Decision, the Expropriation Decision was invalidated and the ownership of the relevant land sites was returned to the Land Owners. Under the current circumstances, Company C cannot proceed with the Project further unless Company C successfully purchases the concerned land sites from the Land Owners.
II. Summary of Final Decision
Under the Final Decision, the Supreme Court of Korea held that the Government License is invalid and, thus, the Expropriation Decision based thereon is also invalid.
The grounds for the Supreme Court's decision were as follows:
The Governmental License was granted to establish an "amusement park" as set forth in the National Land Planning and Utilization Act (the "Act"). Under the Act, an amusement park is defined as "a facility to be established mostly for the amusement and rest of citizens contributing to the improvement of citizens' welfare." However, the Supreme Court found that the Residential Complex was being developed as a facility not for general citizens but for domestic and foreign tourists, particularly wealthy elderly people to stay for mid-to-long-term periods, and that such development concept was not consistent with the concept of an "amusement park" under the Act. The Supreme Court deemed that there was an error in granting the Governmental License for the development of the Residential Complex, which is not an amusement park, and that such erroneous grant of the Governmental License was in violation of the Act. Consequently, the Supreme Court held that, since such error was material and unquestionable, the Governmental License was invalid and accordingly, the Expropriation Decision based thereon was also invalid.
III. Other Issues
With respect to the Final Decision, the following legal issues are currently being discussed in the relevant industry and legal community:
Impact of the Final Decision on Other Governmental Permits and Licenses Granted with respect to the Project
With respect to the Project, there were other governmental permits and licenses that were granted other than the Governmental License (such permits and licenses, the "Other Licenses"); as such, whether the invalidation of the Governmental License should affect the validity of the Other Licenses is currently being discussed.
In order to examine this issue more closely, it is necessary to look into the details of the relationship between the Governmental License and the Other Licenses. If the Other Licenses were granted based on the Governmental License, it is highly likely that the Other Licenses will also be invalidated, and even if the Other Licenses were granted not based on the Governmental License, if the Other Licenses were granted erroneously as in the case of the Governmental License, it is also likely that the Other Licenses will be invalidated.
In any case, regardless of the validity of the Other Licenses, it has become practically difficult for Company C to proceed with the Project further without the Governmental License.
Whether or not Any Event of Default Occurred under the Loan Agreement related to the Project
Also at issue is whether, upon the invalidation of the Governmental License, any event of default occurred under the loan agreement entered into to finance the Project.
This issue is dependent on the relevant default provisions of the loan agreement. If invalidation of any governmental permits and licenses is set forth as an event of default under the loan agreement, it would seem that an event of default has occurred. However, in the event there is no such explicit provision in the loan agreement, the determination of whether an event of default has occurred may need to be made on the basis of whether it is possible to continue to carry out the Project.
Whether the Construction Company Should Remain Obligated to Complete the Construction Works
In connection with the construction works for the Project, another legal issue is whether the construction company which undertook to complete the construction works for the Project is required to complete the construction works regardless of the invalidation of the Governmental License, or whether such construction company will be exempted from its obligation to complete the construction works since such circumstances constitute a force majeure under the relevant construction contract.
This issue will be determined based on the details of the relevant provisions concerning the construction company's covenants regarding completion of the construction works under the relevant construction agreement; i.e, whether or not Company C agreed on the construction company's covenants regarding completion of the construction works with the intent that Company C as the developer will bear the risk relating to governmental permits and licenses.
IV. Implication of the Final Decision and Matters to be Considered for Future Investment in Development Project in Korea
It appears that Company B (which is a foreign entity) invested in the Project based on its trust in the Korean government, since the Project was actively carried forward by the Korean government and local government. However, this case shows that even if the relevant project is promoted by the government agency or local government, if the relevant developer fails to fully comply with the relevant laws and procedures in carrying out the project, the governmental permits and licenses in connection with the project may be invalidated through court proceedings and other proceedings and that such project can be suspended.
We note from this case that a significant loss may be incurred to the relevant parties if they implement a project without conducting a thorough review of the project from a legal perspective.
In this regard, it is strongly advisable for foreign investors that are interested in investing in a real estate development project in Korea to carefully check and confirm whether the relevant governmental permits and licenses fully satisfy the requirements set forth in the applicable laws and regulations, and to ensure that it is clearly specified in the relevant agreements which party shall be liable for matters relating to governmental permits and licenses.
Representative Matter 1.
Yulchon advised Hotel Lotte on its acquisition of a Russian company currently developing a hotel facility in Saint Petersburg, Russia
Yulchon successfully represented Hotel Lotte on its acquisition of a Russian developer engaged in the development of a hotel facility in Saint Petersburg, Russia for KRW50 billion. The hotel premise is located in the central location within the city where globally acclaimed hotel chains such as Four Seasons and W Hotel are operating their top-notch hotel facilities.
Through this transaction, Hotel Lotte will have an opportunity to expand its businesses in Russia and maximize the Lotte brand recognition. Yulchon advised Hotel Lotte on all aspects of the transaction including advice on the deal structure, due diligence, drafting and negotiation of the definitive agreement and closing for successful transaction.
On this transaction, Hee Woong Yoon, Tehyok Yi, Hwa Joon Lee, Chris H. Kang and In Kim of Yulchon's C&F Group advised Hotel Lotte.
In addition to this project, Yulchon has accumulated unparalleled experience in advising on hotel and resort projects by successfully completing other projects of Hotel Lotte in Moscow, Tashkent, Uzbekistan, and Guam.
Representative Matter 2.
Airbus A380 finance lease transaction involving Etihad Airways
Yulchon acted for Hi Investment & Securities in the finance lease transaction involving an Airbus A380 aircraft. The aircraft was purchased by a Cayman Islands special purpose vehicle, which acted as the loan note issuer for the loan note issued to finance the purchase of the aircraft, which was leased to Etihad Airways PJSC.
This financing was composed of the issuance of loan notes in the amount of USD290,000,000 by the Cayman Islands entity to raise funds for the purchase, which was backed by the issuance of private placement bonds by a local Korean special purpose company to a Korean investment trust.
Yulchon provided comprehensive legal advice for the entire transaction from the structuring of the project, review and provision of tax advice and review and negotiation of all transaction, financing and security documents. Although Etihad Airways and other related parties were all in different jurisdictions (United Arab Emirates, Cayman Islands, Singapore and Korea), Yulchon successfully and smoothly handled the documentation, negotiation, signing and closing process within the required timeframe.
This deal was led by Christopher Joon Tae Cho and handled by Sung Keun Park and Jung Pyo Seo of the finance group. Sang Woo Song and Su Hyeon Sung provided tax advice for the transaction.
Representative Matter 3.
First court decision allowing enforcement of arbitral award which orders indirect compulsory performance penalty in Korea
Yulchon successfully represented Euro Apex B.V. ("Apex"), a Dutch manufacturer of proprietary heat exchangers, in an arbitral award enforcement proceeding in Korea against a Korean Company ("Defendant"), a Korean manufacturer of similar products.
In the proceedings before the Korean court, Apex sought to obtain an enforcement judgment for an arbitration award rendered under the Netherlands Arbitration Institute (NAI) Arbitration Rules, which ordered Defendant to transfer all of the patents it acquired using Apex's technology, and also to pay indirect compulsory performance penalty if it fails to transfer the patents.
Central to the dispute was whether an arbitral tribunal can order indirect compulsory performance penalty, and whether such penalty can be enforced under Korean law. In the Korean proceedings, Defendant not only argued that the indirect compulsory performance penalty is against Korean Civil Execution Act and thus cannot be enforced, it went so far as to argue that the award which orders such penalty is in violation of public policy rendering a basis for a refusal to enforce a foreign arbitral award under Section V(2)(b) of the New York Convention. Defendant additionally argued that the accrued amount of penalties is ten times the amount of actual damages awarded and therefore the Tribunal erred in calculating the proper amount of penalty.
The Incheon District Court, however, ruled in favour of Apex finding that Civil Execution Act cannot be construed in a way to prevent indirect compulsory performance penalty from being enforced, and that such penalty may be allowed in arbitration awards if the tribunal deems it necessary to order as such to secure the performance of debts which performance cannot be provided by a third party. The Court also noted that such penalty cannot be deemed excessive just because the accrued amount is higher than the damages awarded since this was attributable to the failure on Defendant's part to voluntarily comply with the arbitration award.
This is the very first decision in which the court allowed the enforcement of an indirect compulsory performance penalty ordered in an arbitration award. If affirmed by appellate courts, the decision would significantly change the landscape of arbitration practice in Korea.
Mr. Young Seok Lee, Ms. Jeong Hye Ahn and Ms. So Young Jeong of Yulchon's International Dispute Resolution Team represented Apex in this case.
Representative Matter 4.
Yulchon represented POSCO in its patent litigation victory against NIPPON STEEL at the Patent Court
Yulchon represented POSCO in a patent invalidation litigation involving four patents against Nippon Steel & Sumitomo Metal Corporation (the two merged corporations, hereafter referred to as "Nippon Steel"). POSCO and Nippon Steel are two of the largest steel producers in the world. Yulchon's Intellectual Property Group helped POSCO secure favorable verdicts from the Korean Patent Court affirming the invalidation of three patents by the Korean Intellectual Property Trial and Appeal Board (hereinafter "KIPTAB"). The fourth patent expired in October 2012.
The patents relate to grain-oriented electrical steel sheets, which are used in electrical transformers, including transformers utilized in hybrid or electric automobiles. Demand for these specialized steel products has been growing internationally, and these valuable products command a very high selling margin. In the past, Nippon Steel was the only international supplier of such grain-oriented electrical steel sheets. After POSCO started to produce and sell grain-oriented electrical steel sheets in the early 2000's, Nippon Steel has seen a continuous decrease in its market share. In an attempt to maintain its competitive standing, Nippon Steel initiated lawsuits for patent infringement in multiple foreign jurisdictions.
In April 2013, POSCO responded by filing invalidation proceedings regarding the four Korean patents asserted in the infringement action. In February 17, 2014, the KIPTAB held all four Korean patents of Nippon Steel invalid. On February 25, 2014, Nippon Steel appealed to the Korean Patent Court, requesting cancellation of the KIPTAB decision. In view of the value of grain-oriented electrical steel sheets and the controversy involving two of the largest steel producers in the world, the developments in this lawsuit were carefully followed by the industry and the press.
Yulchon's team for this case included Jeong Yeol Choe, Dong Soo Han, Hyeong Joo Lim, Su Hak Lee, Il Hyun Park, and Jin Hyung Lee.
Yulchon honored as Korea's 'Most Innovative Law Firm' by Financial Times
June 11, 2015 - Of the 25 law firms that appear in this year's Financial Times rankings for the most innovative law firms in the Asia-Pacific region, Yulchon ranked 1st among Korean firms and 4th overall- collecting a total of 89 points from corporate, finance and business of law categories. The results were announced at a ceremony in Hong Kong on June 10 and published in the FT's Innovative Lawyers Award 2015.
This distinction was especially buoyed by several factors of which Yulchon's exemplary work for the publicly listed STX Corporation was instrumental. The firm's finance team, led by partner Ki Young Kim, helped the beleaguered trading company proceed with an unprecedented $155m debt-to-equity swap for publicly held bonds by securing the approval of the majority of STX's bondholders. What made the STX deal noteworthy and precedent-setting was the involvement of bonds held by numerous individual bondholders and was carried out as STX was undergoing a voluntary business reorganization under the supervision of its larger creditors. This matter garnered the firm 47 points- the highest score among Korean firms shortlisted in the finance category.
Mr. Kim told the Financial Times, "This is a win-win," and added "Before this transaction, when a company was in distress with a huge amount of creditors that were not financial institutions, they would usually reject a workout. Now, the same method can be used instead of bankruptcy procedures."
Mr. Kim, who received the most innovative law firm award on behalf of Yulchon, said after the ceremony: "We're truly honored to have received this prestigious award from Financial Times. It's a true testament to the efforts of our team and the entire Yulchon family. By delivering new and innovative solutions, we have once again shown that our firm rises to the occasion in times of crisis for our clients."
In the business of law category, the firm was given the highest marks among shortlisted Korean firms with 21 points. In an official statement made to Financial Times, Yulchon encapsulated the firm as a "A new generation law firm in South Korea founded on democratic, open and collaborative principles. Through its inclusive management committee, the firm has developed mechanisms for more equitable profit distribution."
Additional spotlight was given to the firm for its representation of a Korean securities company in a dispute with the Lehman Brothers estate over the valuation of 15 equity-linked swaps that were terminated upon Lehman's bankruptcy filing in 2008. Yulchon combined legal advice with forensic derivative valuation to analyze these complex derivative products. Yulchon's team was led by partner Ben Hur and included American capital markets lawyer Andrew Keller. Senior Advisor Carl Im, former derivatives trader at a top investment bank, played a key role by providing innovative and sophisticated arguments of how to properly value the termination amounts due under the swap agreements.
Currently in its seventh year of publication (second in Asia), the FT Innovative Lawyers Award has become a leading legal rankings authority in the Asia-Pacific region, and the accompanying awards are widely regarded as the best researched in the market. The report presents a unique analysis of the legal industry and is the only ranking of lawyers by innovation. This year, the FT Innovative Lawyers Award drew over 400 submissions and nominations from more than 100 law firms and in-house legal teams in this region and hundreds of client, expert and lawyers were interviewed.
Signboard Hanging Ceremony for "Yulchon-Seoul National University Research Center for Developing Nations"
Yulchon is sponsoring to foster elites from developing nations of Southeast Asia together with Seoul National University (SNU). Yulchon jointly established the Yulchon-SNU Research Center for Developing Nations with Graduate School of International Studies (GSIS) and held the signboard hanging ceremony on March 11.
At the Yulchon-SNU Research Center for Developing Nations, studies on the economies/industries of Korea and developing nations as well as on Korea's legal system and the relevant institutions will be conducted by the GSIS students from developing nations. At the ceremony, Chang Rok Woo, the Chairman of Yulchon, stated, "I hope the students from developing nations can conduct studies on various subjects, including the Korean economy and legal system, in a more constructive environment offered at Yulchon-SNU Research Center for Developing Nations, and have opportunities to make contributions to their respective countries in the future."
Meanwhile, Yulchon is expanding the scope of social contributions by adopting the CSV (Creating Shared Value) concept for a long-term development and enhancement of competitiveness, taking a step further from the existing CSR activities.
Opening of Yulchon's Office in Moscow, Russia
The opening ceremony of Yulchon's Moscow office, the firm's fifth office, was held on March 24, 2015.
In the ceremony held at Lotte Hotel located in Moscow, approximately 100 attendants, including Russian government officials, representatives from Korean businesses in Russia and Korean Embassy participated.
Yulchon's Russia team, spearheaded by Hwa Joon Lee, has a long track record of satisfying the legal needs of Korean companies in relation to their businesses in Russia and Central Asian countries. Among others, the team recently advised Lotte Hotel on its acquisition of a hotel site in St. Petersburg, Russia, and is currently advising Lotte Group on its acquisition of a large commercial complex in Moscow.
Following the Ukraine crisis, more opportunities are opening up for Korean businesses, as the tension between Russia on one hand and European countries and the U.S. on the other hand has heightened. Yulchon's Moscow office is expected serve as a stepping stone for Korean businesses planning to enter Russia.
Address: 12th Fl. White Gardens Business Center, 7 Ulitsa Lesnaya, Moscow, Russian Federation, 125047
Tel: +7-495-510-5200 | Fax: +7-495-510-5228
Yulchon Recognized by ALB as "The Employer of Choice" for the Seventh Consecutive Year
Further solidifying its reputation as one of the best law firms to work for in Asia, Yulchon received "The Employer of Choice" award by Asian Legal Business (ALB) for the seventh consecutive year.
The selection criteria are based on a comprehensive survey involving more than 20,000 lawyers in the Asia-Pacific region who are asked to rate their current employers based on key areas which include:
work environment, remuneration, work-life balance and job security. According to the report, lawyers at Yulchon gave high satisfaction marks to the firm's work-life balance as well as its culture of cultivating a collaborative work environment.
The ALB highlighted the firm's foremost priority on recruiting, rewarding, and retaining top talent and nurturing a flexible work atmosphere through its "One Firm Partnership" initiative. Known for its system of proactive cooperation among its lawyers, Yulchon believes this empowers them to work more nimbly across practices with a singularity that instills confidence in its clients. The firm's in-house academic center and special recruitment program which targets graduates from diversified law schools was also given special praise in the report.
"Yulchon is the only law firm in Korea with a recruiting program specially targeting graduates of law schools located outside of the Seoul Metropolitan Area for the purpose of helping those law schools to increase their competitiveness as well as discovering the best talents from all parts of the country," said Son Doil, partner at Yulchon. Yulchon also operates "Yulchon Academy," an in-house continuing education center that provides career development programs, language training programs, various professional and general liberal arts courses as well as short-term and long-term study abroad programs for Yulchon employees.
The Yulchon Academy is the first of its kind in Korea and delivers a comprehensive training curriculum for Yulchon professionals tailored to their level of experience. The program was first initiated in 2007 and ensures professionals at Yulchon continue to develop and refine their areas of expertise.
"At Yulchon, we do our best to bring the best talent to join our family of esteemed lawyers, because we believe a good company is created by good people," said Yun Sai Ree, Managing Partner of Yulchon. "This recognition is testament to the exemplary work culture we value and are continuing to develop."
Yulchon Chairman Receives President's Award for Providing Employment Opportunities for the Disabled
On April 16, 2015, Chang Rok Woo, Chairman of Yulchon received the 2015 President's Award for spearheading an initiative that provides employment opportunities for the disabled. This honor was presented at an event organized by the Korea Employment Agency.
Yulchon currently employs eight persons with physical and mental disabilities who are each given the right amount of work within areas that best fit their capabilities. The firm continues to provide proactive support to foster their development as valued employees. A range of positions are being planned to offer even more opportunities in the future. This initiative will look to expand the scope of work beyond maintenance and custodial duties and into administrative areas.
"Providing employment opportunities to the disabled does more than simply giving them a chance to make a living, it also lets them stand tall as proud, contributing members of the community," said Chang Rok Woo. "We are obligated, not only as a law firm but as people, to provide them with good welfare and the safety net of employment and we intend to continue improving this area as we believe this is our social responsibility."
Moritz Winkler Appointed as president and chairman of the board of directors of the German School Seoul International (DSSI)
Mr. Moritz Winkler, a senior foreign attorney at Yulchon, has been elected as president and chairman of the board of directors of the German School Seoul International (DSSI).
He succeeds Mr. Stefan Halusa, president of Brose Korea. Mr. Winkler is a graduate from LMU Munich Faculty of Law and has joined Yulchon in 2006, where he heads the firm's German Desk.
In addition to his cross-border corporate/M&A practice, Mr. Winkler has been actively engaging in pro bono work, which is supported by the firm.