[비즈한국] The bankruptcy procedure for the K-Sports Foundation, considered the starting point of the Park Geun-hye administration's 'influence-peddling scandal,' has been completed. The Seoul Bankruptcy Court issued the final notice of bankruptcy termination for the K-Sports Foundation on May 22. The Mir Foundation and the K-Sports Foundation were non-profit foundations established in 2016 under the leadership of the Federation of Korean Industries (now the Korea Economic Association). During their establishment, both foundations received contributions from numerous large corporations. This sparked allegations that the contributions were made under duress by former President Park Geun-hye and Choi Soon-sil (later renamed Choi Seo-won). The scandal subsequently expanded into the 'Choi Soon-sil Gate' as it was revealed that Choi effectively operated both foundations.
The Mir Foundation had its establishment permit revoked by the Ministry of Culture, Sports and Tourism (MCST) in 2018, and its assets were returned to the state treasury. To recover their contributions to the Mir Foundation, companies would have to file lawsuits against the government, but there have been no visible legal moves to date.
The K-Sports Foundation challenged the MCST's decision by filing a lawsuit to invalidate the revocation of its establishment permit, but it ultimately lost the case. In 2018, the K-Sports Foundation initially expressed an intention to return contributions to companies, but later changed its stance and refused to do so. The logic was that since former President Park Geun-hye’s charge of coercion was judged not guilty, the contributions made by large corporations to the K-Sports Foundation were based on their free will. The Supreme Court ruled that regarding former President Park's request for contributions to the K-Sports Foundation, the charge of coercion was not guilty, and only the charge of abuse of power was upheld. This is because it was not recognized that the former president had threatened the large corporations, thus failing to meet the requirements for the charge of coercion.
Consequently, KT030200 won a legal battle against the K-Sports Foundation and recovered its contribution. Besides KT, several other companies also won lawsuits for the return of their contributions. In a ruling for a lawsuit filed by a company to recover its contribution, the court stated, "Making a contribution without knowing the actual purpose and circumstances of the K-Sports Foundation's establishment, while relying solely on the proposed plans and articles of association, constitutes a mistake in motive," adding that "(The K-Sports Foundation) was found to contain serious and manifest illegality that led to the revocation of its establishment itself; if these facts had been known in advance, the contribution would not have been made."
Ultimately, the K-Sports Foundation was declared bankrupt in 2024. It reached bankruptcy as the amount of contributions to be returned and its debts exceeded its total assets. Although the K-Sports Foundation had already received a revocation of its establishment permit from the MCST, it had maintained its corporate status while going through procedures such as returning contributions and repaying debts. However, with the bankruptcy declaration, it could no longer effectively perform its role as a corporation.
At the time the K-Sports Foundation was declared bankrupt, many companies had still not received their contributions back. Since the foundation had no notable activities or new donations after 2018, it reportedly did not hold significant assets. Even when the donor companies or creditors demanded returns, it was realistically impossible to repay the full amounts.
Following the bankruptcy declaration, the K-Sports Foundation underwent related procedures and only proceeded with creditor dividend distribution this year. According to the dividend notice released on March 23, two months before the bankruptcy termination notice, the total debt to be repaid by the K-Sports Foundation was 41.43888 billion KRW, but the immediately distributable funds amounted to only 26.23284 billion KRW. As a result, the large corporations and creditors did not receive the full amount of their contributions back.
The Seoul Bankruptcy Court stated in the notice of the K-Sports Foundation's bankruptcy termination that "The final dividend distribution has ended, and the creditor meeting has approved the calculations based on the completion of the bankruptcy trustee's duties, bringing the case to a close." With this, both the Mir Foundation and the K-Sports Foundation, which were central to the Choi Soon-sil Gate, have faded into history, leaving large corporations unable to recover the entirety of their contributions.