By Lee Hyo-sik
Staff Reporter


Hyundai Elevator, a de facto holding company of Hyundai Group, has been under a tax probe, raising speculation that it may be the beginning of full-fledged government scrutiny into Hyundai’s North Korean tourism projects for possible financial irregularities.

The National Tax Service (NTS) began its investigation on Sept. 1 and plans to complete it by Oct. 7. An NTS official said it is just a routine tax audit that the tax agency carries out every five years, refusing to elaborate further.

An official at Hyundai Elevator also confirmed the NTS audit of the firm, stressing it is a normal tax probe that has nothing to do with other Hyundai companies.

Hyundai Elevator holds a large amount of shares in seven subsidiaries and affiliates, including Hyundai Asan, Hyundai Group’s North Korean business arm.

Industry watchers have speculated that the tax agency may expand its investigation into other Hyundai companies, particularly Hyundai Asan, when the joint projects with the North face a deadlock.

North Korea is displeased with Hyundai Group chairwoman Hyun Jeong-eun’s decision on Aug. 19 to dismiss Kim Yoon-kyu, who oversaw the tourism projects since 2000.

He was dismissed as vice chairman and chief executive office of Hyundai Asan over an allegation that Kim diverted unverified sums of company funds invested in signature projects with North Korea, mainly sightseeing tours to Mt. Kumgang, for personal use.

The North has indicated that it might suspend all tour programs unless Kim continues to play a part in the projects.

leehs@koreatimes.co.kr