최근 ELS 소송에서의 민법 제150조 제1항 적용의 쟁점과 함의

The Issues and Implications of Recent ELS Litigations Regarding Paragraph(1) of Article 150 of the Civil Code

The Issues and Implications in the Recent ELS Litigations regarding the Paragraph(1) of the Article 150 of the Civil Code. This article deals with the recent Equity-Linked Securities(‘ELS’) disputes. During the year 2015 and 2016, the Supreme Court rendered 7 judgments in 6 or 7 years with respect to the ELS disputes those began in 2009 with the media spotlight. The gist of the complaint is that the securities companies who sold the ELS product, or the foreign financial institutions(“Hedge Management Company” or “HMC”) who conducted the hedge transactions for such securities companies’ ELS product, have sold the underlying stocks massively to the market right ahead of the settlement, resulting in the stock prices going down to abort the fulfillment of the conditions according to which otherwise the investors would get the money. The interesting point is that the plaintiffs used as the main legal ground not the Capital Market Act, but the Article 150 of the Civil Code, which is contrary to the general expectation of the legal circle and the financial industry as well. Why and what difference between the two? This is the main concern of this article. In this background, the author analyzes for the first time in Korea, (i) the elements of the Article 150 of the Civil Code, applying the disputes thereto, (ii) the difference of the cause of actions between the Capital Market Act’s stock manipulation and the Civil Code s Good Faith Principle, (iii) the possible civil liability structure and difference between when the securities companies conducted hedge transactions on its own and when used the HMC, and (iv) the dos and don’t of the securities companies in light of the Article 150 of the Civil Code which is different from the view point of the Capital Market Act.