SEOUL: The chairman of South Korean construction firm HDC Hyundai Development Co stepped down from his role on Monday after outer wall structures of an apartment complex it was building collapsed last week, with one person found dead and five people still missing.
The collapse in Gwangju, South Korea on Jan. 11 was the second serious incident within a year for HDC, one of the top 10 housing developers in South Korea. Nine people died and eight were injured when a five-story building being demolished under HDC's purview collapsed in June last year, also in Gwangju.
Chung Mong-gyu, who is also chairman of parent HDC Holdings Co Ltd and a member of the larger family that controls the Hyundai group of companies, said he is resigning from the chairman role of the builder "with a deep sense of responsibility for the two incidents in Gwangju".
"If there is an issue from the safety diagnosis conducted with outside experts and the government, contract terminations with apartment buyers, complete demolition and re-construction can be considered," he told a televised press conference.
Chung's resignation comes before a new South Korean law known as the Severe Accident Punishment Act takes effect near the end of this month.
The law imposes criminal punishment of one or more years of jail or fines up to 1 billion won ($838,434) for severe industrial accidents on business owners and responsible management if they violated a duty of safety measures stipulated in the law, such as manpower and budget necessary to prevent industrial accidents.
Neither HDC nor Chung have been accused of wrongdoing.
"I am not considering shirking responsibility by resigning. I will fulfil my responsibilities as a major shareholder," Chung said.
Shares in HDC rose 2.7% after the resignation announcement versus the wider market's 1.1% drop.
($1 = 1,192.7000 won)
(Reporting by Joyce Lee; Editing by Kenneth Maxwell) ((email@example.com;))