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Commitments and Contingencies | 12 Months Ended
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Dec. 31, 2020
Text block [abstract] |
Commitments and Contingencies |
20. | Commitments and Contingencie s
As at December 31, 2020, major commitments with local financial institutions are as follows:
(In millions of Korean won and thousands of foreign currencies) |  | Financial institution |  | Currency |  | Limit |  |  | Used amount |
Bank overdraft |  | Kookmin Bank and others |  | KRW |  |  | 1,502,000 |  |  |  | — |
Inter-Korean Cooperation Fund |  | Export-Import Bank of Korea |  | KRW |  |  | 37,700 |  |  |  | 2,714 |
Insurance for Economic Cooperation project |  | Export-Import Bank of Korea |  | KRW |  |  | 3,240 |  |  |  | 1,732 |
Collateralized loan on electronic accounts receivable-trade |  | Kookmin Bank and others |  | KRW |  |  | 522,849 |  |  |  | 23,475 |
Plus electronic notes payable |  | Industrial Bank of Korea |  | KRW |  |  | 50,000 |  |  |  | 331 |
Loans for working capital |  | Korea Development Bank and others |  | KRW |  |  | 243,593 |  |  |  | 152,243 |
Facility loans |  | Shinhan Bank and others |  | KRW |  |  | 100,123 |  |  |  | 55 |
| Kookmin Bank and others |  | USD |  |  | 212,000 |  |  |  | 48,855 |
Derivatives transaction limit |  | Korea Development Bank |  | KRW |  |  | 100,000 |  |  |  | 22,027 |
| Woori Bank and others |  | USD |  |  | 69,054 |  |  |  | 44,616 |
Total |  |  |  | KRW |  |  | 2,559,505 |  |  |  | 202,577 |
|  | USD |  |  | 281,054 |  |  |  | 93,471 |
As at December 31, 2020, guarantees received from financial institutions are as follows:
(In millions of Korean won and thousands of foreign currencies) |  | Financial institution |  | Currency |  |  | Limit |
Performance guarantee |  | Seoul Guarantee Insurance and others |  |  | KRW |  |  |  | 208,386 |
Performance guarantee |  | Korea Development Bank and others |  |  | USD |  |  |  | 8,569 |
Guarantee for import letters of credit |  | Industrial Bank of Korea and others |  |  | USD |  |  |  | 5,000 |
Guarantee for payment in won currency |  | Shinhan Bank and others |  |  | KRW |  |  |  | 70,962 |
Refund guarantee for advances received |  | Korea Development Bank |  |  | USD |  |  |  | 8,536 |
Guarantee for payment in foreign currency |  | KEB Hana Bank and others |  |  | USD |  |  |  | 40,840 |
Comprehensive credit line |  | KEB Hana Bank and others |  |  | KRW |  |  |  | 41,100 |
Comprehensive credit line |  | KEB Hana Bank and others |  |  | USD |  |  |  | 8,700 |
Bid guarantee |  | KEB Hana Bank |  |  | USD |  |  |  | 400 |
Bid guarantee |  | Korea Software Financial Cooperative and others |  |  | KRW |  |  |  | 80,246 |
Performance guarantee /warranty guarantee |  |  |  |  | KRW |  |  |  | 393,019 |
Guarantee for advance payments/others |  |  |  |  | KRW |  |  |  | 388,656 |
Warranty guarantee |  | Seoul Guarantee Insurance |  |  | KRW |  |  |  | 1,305 |
Performance guarantee |  |  |  |  | KRW |  |  |  | 9,690 |
Guarantees for licensing |  |  |  |  | KRW |  |  |  | 7,748 |
Guarantees for depositions |  |  |  |  | KRW |  |  |  | 3,792 |
Merchant business guarantee insurance |  |  |  |  | KRW |  |  |  | 237 |
Total |  |  |  |  | KRW |  |  |  | 1,205,141 |
|  |  |  |  | USD |  |  |  | 72,045 |
As at December 31, 2020, guarantees provided by the Group to a third party, are as follows:
(In millions of Korean won) |  | Subject to payment guarantees |  | Creditor |  | Limit |  |  | Used amount |  |  | Period |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) 1 |  | Gasan Solar Power Plant Inc. |  | Shinhan Bank |  |  | 4,700 |  |  |  | 1,371 |  |  |  | Jan. 08, 2025 |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) 1 |  | SPP Inc. |  | Suhyup Bank |  |  | 3,250 |  |  |  | 932 |  |  |  | Feb. 16, 2024 |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) 1 |  | Korea Cell Inc. |  | Suhyup Bank |  |  | 3,250 |  |  |  | 880 |  |  |  | Feb. 16, 2024 |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) 1 |  | San-Ya Agricultural Association Corporation |  | Suhyup Bank |  |  | 3,250 |  |  |  | 888 |  |  |  | Feb. 16, 2024 |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) 1 |  | Ciocanesti Korea Co., Ltd. |  | NH Investment & Securities Co.,Ltd. |  |  | 7,600 |  |  |  | 7,600 |  |  |  | Jun. 8, 2017 |
KT Hitel Co., Ltd. |  | Shinhan Bank |  | Cash payers |  |  | 700 |  |  |  | — |  |  |  | Apr. 17, 2020 ~ Apr. 16, 2021 |
Nasmedia Co., Ltd. |  | Stockholders Association Members |  | Korea Securities Finance Corp |  |  | 5,654 |  |  |  | 2,735 |  |  |  | — |
| 1 | According to the above payment guarantee, KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.), a subsidiary of the Group, will have an obligation of repayment if the principal borrower does not repay the borrowing.
The Controlling Company is jointly and severally obligated with KT Sat Co., Ltd. to pay KT Sat Co., Ltd.’s liabilities incurred prior to spin-off. As at December 31, 2020, the Controlling Company and KT Sat Co., Ltd. are jointly and severally liable for reimbursement of ￦ 1,618 million. For the years ended December 31, 2019 and 2020, the Group made agreements with the Securitization Specialty Companies (2020: First 5G 49 th to 54 th Securitization Specialty Co., Ltd., 2019: First 5G 43 rd to 48 th Securitization Specialty Co., Ltd., 2018: Giga LTE Thirty seventh to Forty second Securitization Specialty Co., Ltd.), and disposed of its trade receivables related to handset sales. The Group also made asset management agreements with each securitization specialty company and in accordance with the agreement the Group will receive asset management fees upon liquidation of securitization specialty company. As at December 31, 2020, the Group is a defendant in 195 lawsuits with the total claimed amount of ￦ 110,409 million (2019: ￦ 214,877 million). As at December 31, 2020, litigation provisions of ￦ 76,500 million (2019: ￦ 62,241 million) for pending lawsuits and unasserted claims are recorded as liabilities for potential loss in the ordinary course of business. The final outcomes of the cases cannot be estimated as at December 31, 2020. According to the financial and other covenants included in certain debentures and borrowings, the Group is required to maintain certain financial ratios such as debt-to-equity ratio, use the funds for the designated purpose and report to the creditors periodically. The covenant also contains restriction on provision of additional collateral and disposal of certain assets. As at December 31, 2020, the Group participates in Algerie Sidi Abdela new town development consortium (percentage of ownership: 2.5%) and has joint liability with other consortium participants. As at December 31, 2020, contract amount of property and equipment acquisition agreement made but not yet recognized amounts to ￦ 596,983 million (2019: ￦ 851,798 million).

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- Definition The disclosure of commitments and contingent liabilities. [Refer: Contingent liabilities [member]] + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Name IAS -Number 1 -IssueDate 2020-01-01 -Paragraph 10 -Subparagraph e -URI http://eifrs.ifrs.org/eifrs/xifrs-link?type=IAS&num=1&code=ifrs-tx-2020-en-r&anchor=para_10_e&doctype=Standard -URIDate 2020-01-01 + Details
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