Domestic woes are mounting for Samsung Electronics Co, South Korea's biggest and most profitable business group, recognized as a major global player and market leader in memory chips.
Last month, while Japanese rival Sony Corp was announcing restructuring plans including 10,000 job cuts, Samsung paraded a US$33 billion expansion plan creating 14,000 new jobs.
The company that emerged from the 1997 Asian financial crisis stronger than ever, toppling the Hyundai group as South Korea's top corporate performer, should have been basking in glory and applause.
Instead, the announcement only succeeded in temporarily deflecting public attention away from a tangle of troubles that have been brewing around the company for months.
A major difficulty for the corporate giant that accounted for nearly 20 percent of all South Korean exports last year has been its battle against a government-backed drive to limit the power of top conglomerates.
South Korea maintains strict regulations to curb the growth of the conglomerates which control nearly 40 percent of the economy and whose reckless expansion was blamed for triggering the 1997 crisis here.
But Samsung has led a corporate revolt. Backed by other conglomerates, it complains that those regulations make local firms more vulnerable to hostile take-over bids by foreign investors.
Foreign investors hold a stake average of 46.8 percent in South Korea's top 10 conglomerates, while the foreign stake in Samsung stands at 54 percent of its total market capitalization.
Critics dismissed Samsung's argument as unwarranted and suggested the group could fend off any hostile takeover bids by enhancing transparency.
At the center of debate is a 1997 law which forbids affiliates of conglomerates from holding shares of non-financial affiliates in excess of 5 percent.
The government is drawing up amendments under which conglomerates would be compelled to dispose of all stock holdings that exceed the limit of 5 percent.
"Samsung is bringing misfortune on itself by ignoring calls to improve corporate governance," said Kim Woo-chan, a researcher at the state-financed Korea Development Institute.
He accused Samsung's founding family of clinging to an outdated perception that the group's helm must be transferred to their offspring.
The attacks against Samsung turned into an onslaught in August when allegations emerged of Samsung's illicit links to politics through a slush fund.
Hong Seok-hyun, a brother-in-law of Samsung Group chief Lee Kun-hee, resigned as ambassador to the US over a 1997 conversation taped by intelligence officials.
The conversation between Hong and a Samsung executive about where the group should place illegal political donations triggered public anger.
Criticism intensified last week when a court convicted two Samsung executives for illegally handling the father-to-son transfer of ownership at Samsung Everland, the group's holding company.
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