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2026 marks a turning point—a year in which structural changes across politics, the economy, and industry begin to take concrete form.
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The ninth nationwide local elections on June 3 will serve as the first public assessment of the current administration one year after its inauguration. Depending on the outcome, the elections may influence the pace and direction of policy, as well as the evolving allocation of roles between the central and local governments.
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From an economic and corporate governance perspective, 2026 is expected to see the full-scale application of legislative and policy measures with material implications for corporate governance and business judgment. These include amendments to the Commercial Act driven by capital market value-up initiatives—such as the expansion of directors’ fiduciary duties and, subject to legislative approval, the mandatory cancellation of treasury shares—as well as the “Yellow Envelope Act.” As these frameworks are tested in practice for the first time, related legal issues and their implications for corporate management will remain at the forefront.
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At the industry level, AI is emerging as a core growth sector under an increasingly supportive legal and policy environment, anchored by the AI Framework Act and Korea’s ambition to become one of the world’s top three AI leaders. Semiconductors, as a foundational industry for AI, are also expected to remain an important growth engine. Meanwhile, amid the entrenchment of U.S.–China tensions and ongoing geopolitical risks in Ukraine and the Middle East, global demand for the defense industry, along with sustained policy attention, is likely to continue. In parallel, companies will face a complex set of legal risks in 2026, including expanded overseas investment in connection with U.S. investment commitments, regulations aimed at preventing technology leakage, and heightened foreign exchange volatility.
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Against this backdrop, Yulchon LLC presents its report, “2026 Issues and Outlook for Korea,” which provides a comprehensive analysis of (i) domestic and foreign policy variables, (ii) key policy issues relating to AI, capital markets, and core technologies, and (iii) key industry-specific developments across sectors including semiconductors, finance, real estate, labor, shipbuilding, defense, and energy.
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We hope this report will support informed strategic decision-making and effective risk management amid an increasingly complex policy and regulatory environment.
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