South Korea KRX Halts Delistings, Eight Stocks Remain Frozen

Korea Exchange Defers Delisting Procedures

The Korea Exchange (KRX) announced on Wednesday, October 8, that it would defer further delisting procedures for companies designated as administrative issues due to not meeting minimum market capitalisation requirements. This decision follows recent court challenges to the tightened rules.

However, trading remains suspended for eight companies whose delistings had already been decided before this deferral. These include Jooyeon Tech and SHD on the Kospi, alongside Silla SG, Gold&S, KM Pharmaceutical, Pintel, Sejin T&S, and AFW on the Kosdaq.

As of Thursday, 21 Kospi-listed and 47 Kosdaq-listed companies had received the administrative issue designation for market capitalisation shortfalls.

Court Cites Procedural Concerns in New Rules

The Seoul Southern District Court on October 2 granted injunctions sought by Jooyeon Tech and KM Pharmaceutical, halting their delistings pending final rulings. The court found that the KRX had tightened rules without providing companies adequate opportunity to appeal.

It also questioned the extension of the required period for maintaining the market capitalisation threshold from 30 days within a 90-day window to 45 consecutive trading days. Furthermore, the court raised concerns about compliance requirements and the accelerated rollout of the new rules, which left companies insufficient time to prepare for the changes.

Fluctuating Market Capitalisation Thresholds

South Korea’s financial regulators and the KRX introduced new minimum market capitalisation thresholds that took effect in July this year, six months ahead of schedule. These set the minimum at 30 billion won ($22.4 million) for Kospi-listed companies and 20 billion won for Kosdaq-listed companies.

A further increase, raising Kospi’s threshold to 50 billion won and Kosdaq’s to 30 billion won, was initially brought forward from January 2028 to January 2027. However, on September 4, the government postponed this increase again, to July 2027.

The minimum requirement for Kosdaq-listed companies alone rose fivefold in seven months, from 4 billion won at the end of 2025 to 20 billion won by July this year.

Uncertainty for Suspended Firms and Investors

The KRX plans to challenge the court’s ruling, which creates ongoing uncertainty regarding the timing of any resumption in trading for shareholders of the eight suspended companies. Market participants have criticised the Financial Services Commission and the KRX for rapidly implementing reforms aimed at accelerating the removal of troubled companies.

This policy back-and-forth and legal challenge poses regulatory uncertainty for South Korean listed companies and investors, particularly those operating near the market capitalisation thresholds. The outcome of the KRX's appeal will directly determine the trading status of the affected firms.