South Korea's Ministry of Economy and Finance convened its third advisory committee on expanding foreign securities investment, focusing on equity-market access and settlement processes that affect foreign investors’ ability to trade. The ministry outlined progress under its foreign exchange and capital market roadmap aimed at supporting inclusion in the MSCI Developed Market Index, and positioned equity-market accessibility improvements as a priority alongside recent bond-market inflows following South Korea’s inclusion in the World Government Bond Index. Measures discussed included allowing global custodians or asset managers to open and manage settlement accounts on behalf of underlying funds, with Korea Securities Depository system changes set to take effect on 27 April 2026. The ministry also highlighted a shift to enabling real-name verification for account opening using only a Korea Securities Depository legal entity identifier issuance confirmation, introduced on 1 April 2026, with 163 cases recorded as of 16 April. Other workstreams covered easing notarisation and agent requirements and permitting non-face-to-face real-name verification for foreign legal entities (completed in February 2026), ongoing systems changes to support conversion from IRC-based accounts to LEI-based accounts by the first half of 2026, and removing duplicative data submission and reporting obligations for participants in the Naked Short Selling Detection System (completed in January 2026). Advisers supported the pace of implementation but called for continued monitoring of operational frictions as new processes bed in, and flagged the need to manage funding and settlement liquidity given increased foreign trading activity. The ministry indicated it would review the feedback, develop follow-on refinements, and strengthen market communications on the purpose and implementation status of the reforms.
Ministry of Economy & Finance (South Korea) 2026-04-22
South Korea's Ministry of Economy and Finance reviews equity and settlement reforms to attract foreign securities investment
South Korea’s Ministry of Economy and Finance convened its third advisory committee on expanding foreign securities investment, detailing foreign exchange and capital market reforms to improve equity-market access and support potential MSCI Developed Market Index inclusion. Measures include allowing global custodians and asset managers to open settlement accounts for underlying funds, adopting legal entity identifier-based verification and account structures, easing notarisation and agent requirements, and reducing duplicative Naked Short Selling Detection System reporting. Advisers backed the reform pace but urged monitoring of operational frictions and liquidity risks, with the ministry planning further refinements and enhanced market communication.