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Samsung Biologics. (Photo = Samsung Biologics). |
[Alpha Biz= Kim Jisun] The issue of control over Samsung Bioepis before 2015 has emerged as a key point in the appeals trial regarding financial authorities' sanctions against Samsung Biologics, which has faced allegations of accounting fraud.
Financial authorities had previously determined that Bioepis was not a subsidiary of Samsung Biologics between 2012 and 2014. However, the first-instance court did not accept this assessment and subsequently annulled the sanctions. The financial authorities requested an expert witness testimony, but the appellate court denied the request.
On Wednesday afternoon, the Administrative Division 4-1 of the Seoul High Court (Presiding Judges Oh Young-joon, Lee Kwang-man, and Jung Sun-jae) held the first appeal hearing in the lawsuit filed by Samsung Biologics against the Financial Services Commission (FSC) and the Securities and Futures Commission (SFC) to revoke corrective orders and other sanctions. The FSC and SFC had appealed the lower court's decision, which overturned the sanctions.
During the hearing, the financial authorities requested an expert witness testimony to refute the first-instance ruling, focusing on theoretical aspects of call option execution strategies.
The SFC had determined that Samsung Biologics had improperly classified Bioepis as a subsidiary in its consolidated financial statements between 2012 and 2014, despite jointly controlling it with U.S.-based Biogen.
However, the lower court found it difficult to definitively establish joint control, stating, "It is unclear whether Biogen’s call option constitutes a substantive right that should be considered in assessing control." While the court acknowledged or partially acknowledged other grounds for sanctions, it did not recognize this specific issue, ultimately leading to the annulment of the sanctions.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
