Court Overturns Government Approval of YTN Privatization

The court has acknowledged procedural flaws in the YTN privatization approval process and overturned the Korea Communications Commission's (KCC) decision. On November 28th, the Seoul Administrative Court ruled in favor of the YTN Employee Stock Ownership Association in its lawsuit against the KCC, seeking the cancellation of the approval for the change of the largest shareholder. This ruling offers important implications for the independence and public nature of the press.

In its ruling, the court stated that major decisions of the KCC require the participation of at least three of the five standing commissioners, with the support of at least three. This is interpreted as pointing out that the KCC did not meet this quorum requirement during the YTN privatization approval process.

The lawsuit was filed by the YTN Employee Stock Ownership Association in response to the KCC's decision to approve the change of the largest shareholder. The YTN Employee Stock Ownership Association argued that there were problems with the KCC's approval procedure and that the privatization decision infringed on the interests of YTN members.

Previously, on February 7, 2024, the KCC approved Eugene E&T's acquisition of 30.95% of YTN's shares from KEPCO KDN and the Korea Racing Authority. At the time, the KCC determined that Eugene E&T's YTN acquisition plan would not harm the fairness and public interest of broadcasting. However, in this ruling, the court pointed out procedural issues in the KCC's approval process for the change of YTN's largest shareholder and revoked the approval decision.

YTN has not issued an official statement regarding this ruling. However, it is known that the atmosphere within YTN is one of welcoming the ruling. The YTN labor union stated in a statement, "We welcome the court's just ruling and will work harder to restore YTN's public nature."

The Eugene Group is reportedly taken aback by this ruling. An official from the Eugene Group said, "We respect the court's ruling, but this will disrupt our plan to strengthen our media business through the acquisition of YTN." This ruling has virtually halted YTN privatization. The KCC may appeal the court's ruling, but the validity of the first instance ruling appears high. If the KCC abandons the appeal or loses in the appellate court, YTN will again be under the control of a public institution.

Some analysts suggest that this ruling could affect the promotion of privatization of other public institutions in the future. In particular, there are increasing calls to emphasize that the privatization of media organizations should be approached carefully in terms of securing fairness and public interest.

The Korea Communications Commission plans to decide whether to appeal after reviewing the contents of the court's ruling. This ruling has provided an opportunity to review the appropriateness of the legal procedures related to YTN privatization. This ruling is expected to be an important turning point not only for the future of YTN but also for the overall Korean media environment.