Hyundai Motor faces government calls to address big governance risk

South Korea’s new antitrust chief said he has been in talks with the autos-to-steel conglomerate Hyundai about overhauling its complex ownership structure, which critics say gives too much power to its controlling family at the expense of shareholders. Kim Sang-jo, appointed to head the Korea Fair Trade Commission by President Moon Jae-in, told Reuters that Hyundai’s web of cross shareholdings among its group affiliates has resulted in a “big governance risk” for South Korea’s second-largest conglomerate, which is run by its 79-year-old chief, Chung Mong-koo.

“Many people, including me, are telling Hyundai that they shouldn’t waste more time before dissolving cross shareholding,” said Kim, who has been nicknamed “chaebol sniper” for his shareholder activist campaigns targeting South Korea’s powerful family-run conglomerates. “I’m in ongoing conversations with Hyundai.” In his first interview with foreign media since taking office in June, Kim also said South Korea’s antitrust watchdog is looking into competition issues regarding Google’s Android mobile operating system, and has had conversations with the European Commission.

The European Commission last year charged Alphabet’s . Google for using its dominant Android system to shut out rivals, and is weighing a record fine that could come by the end of the year, Reuters reported in July. In South Korea, the Android operating system has a 74 percent market share, and industry officials have questioned whether Google used its mobile dominance to prevent South Korean companies such as Samsung Electronics from developing their own operating systems.

South Korean regulators, which in December fined Qualcomm Inc 1.03 trillion won ($854 million) for what it called unfair business practices in patent licensing and modem chip sales, is also cooperating with its European counterpart on its own investigation into Qualcomm over related issues, Kim said. Hyundai did not have immediate comment outside business hours on Sunday.

Hyundai Motor India Ltd.