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Commitments and Contingencies | 12 Months Ended
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Dec. 31, 2021
Text block [abstract] |
Commitments and Contingencies |
20. | Commitments and Contingencies
As at December 31, 2021, 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 |  |  | 1,452,000 |  |  |  | 4,500 |
Inter-Korean Cooperation Fund |  | Export-Import Bank of Korea |  | KRW |  |  | 37,700 |  |  |  | 2,467 |
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 |  |  | 430,104 |  |  |  | 26,585 |
Plus electronic notes payable |  | Industrial Bank of Korea |  | KRW |  |  | 50,000 |  |  |  | 698 |
Loans for working capital |  | Korea Development Bank and others |  | KRW |  |  | 231,049 |  |  |  | 141,137 |
| Shinhan Bank |  | USD |  |  | 39,298 |  |  |  | 39,298 |
| Woori Bank |  | EUR |  |  | 7,700 |  |  |  | 7,700 |
Facility loans |  | Shinhan Bank and others |  | KRW |  |  | 844,000 |  |  |  | 162,414 |
| Kookmin Bank and others |  | USD |  |  | 212,000 |  |  |  | 9,771 |
Derivatives transaction limit |  | Korea Development Bank |  | KRW |  |  | 100,000 |  |  |  | 8,043 |
| Woori Bank and others |  | USD |  |  | 69,054 |  |  |  | 20,760 |
Total |  |  |  | KRW |  |  | 3,148,093 |  |  |  | 347,576 |
|  |  |  | USD |  |  | 320,352 |  |  |  | 69,829 |
|  |  |  | EUR |  |  | 7,700 |  |  |  | 7,700 |
As at December 31, 2021, 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 |  |  |  | 171,043 |
|  | Hana Bank |  |  | USD |  |  |  | 1,200 |
Guarantee for payment in foreign currency |  | Kookmin Bank and others |  |  | USD |  |  |  | 70,092 |
Guarantee for payment in Korean currency |  | Shinhan Bank and others |  |  | KRW |  |  |  | 20,911 |
Refund guarantee for advances received |  | Korea Development Bank |  |  | USD |  |  |  | 8,536 |
Comprehensive credit line |  | Hana Bank and others |  |  | KRW |  |  |  | 24,800 |
|  |  |  |  | USD |  |  |  | 8,700 |
Guarantees for depositions |  | HSBC |  |  | USD |  |  |  | 580 |
Bid guarantee |  | Hana Bank |  |  | USD |  |  |  | 400 |
Bid guarantee |  | Korea Software Financial Cooperative and others |  |  | KRW |  |  |  | 108,407 |
Performance guarantee / warranty guarantee |  |  |  |  | KRW |  |  |  | 558,359 |
Guarantee for advance payments/others |  |  |  |  | KRW |  |  |  | 574,103 |
Construction fund guarantee insurance and others |  | Seoul Guarantee Insurance |  |  | KRW |  |  |  | 33,963 |
Total |  |  |  |  | KRW |  |  |  | 1,491,586 |
|  |  |  |  | USD |  |  |  | 89,508 |
As at December 31, 2021, 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.) |  | Gasan Solar Power Plant Inc. |  | Shinhan Bank |  | ￦ | 4,700 |  |  | ￦ | 1,035 |  |  |  | Jan. 7, 2021 ~ Jan. 8, 2025 |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) |  | SPP Inc. |  | Suhyup Bank |  |  | 3,250 |  |  |  | 624 |  |  |  | Feb. 17, 2014 ~ Feb. 16, 2024 |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) |  | Korea Cell Inc. |  | Suhyup Bank |  |  | 3,250 |  |  |  | 614 |  |  |  | Feb. 17, 2014 ~ Feb. 16, 2024 |
KT Engineering Co., Ltd. (KT ENGCORE Co., Ltd.) |  | San-Ya Agricultural Association Corporation |  | Suhyup Bank |  |  | 3,250 |  |  |  | 624 |  |  |  | Feb. 17, 2014 ~ Feb. 16, 2024 |
KT Alpha Co., Ltd. (KT Hitel Co., Ltd.) |  | Cash payers |  | Cash payers |  |  | 860 |  |  |  | — |  |  |  | Jul. 21, 2021 ~ Apr. 15, 2022 |
KT Alpha Co., Ltd. (KT Hitel Co., Ltd.) |  | Mobile Voucher amount |  | NongHyup Agribusiness Group Inc and others |  |  | 30,000 |  |  |  | 10,400 |  |  |  | Jan. 16, 2021 ~ Jan. 14, 2022 |
KT Alpha Co., Ltd. (KT Hitel Co., Ltd.) |  | Mobile Voucher amount |  | Emart Co., Ltd and others |  |  | 20,000 |  |  |  | 300 |  |  |  | Jun. 19, 2021 ~ Jun. 17, 2022 |
Nasmedia Co., Ltd. |  | Stockholders Association Members |  | Korea Securities Finance Corp |  |  | 5,654 |  |  |  | 1,236 |  |  |  | — |
As at December 31, 2021, the details of the issuance of real estate collateral trust and beneficiary certificates of the Group are as follows:
( I n millions of Korean won) |  |  |  |  | Commitment (limit) amount |  |  | Amount provided as collateral for beneficiary rights |
Collateral assets |  | Placing |  |  | Trust collateral beneficiary
Real Estate Collateral Trust 1 |  |  | 1st place |  |  | NH Jayang Inc. |  | ￦ | 100,000 |  |  | ￦ | 120,000 |
|  |  |  |  |  | Kyobo Life Insurance |  |  | 180,000 |  |  |  | 216,000 |
|  |  |  |  |  | Standard Chartered Bank Korea Limited |  |  | 120,000 |  |  |  | 144,000 |
|  |  |  |  |  | Samsung Life Insurance |  |  | 100,000 |  |  |  | 120,000 |
|  |  | 2nd place |  |  | Industrial Bank of Korea |  |  | 40,000 |  |  |  | 48,000 |
|  |  |  |  |  | Korea Investment Capital |  |  | 40,000 |  |  |  | 48,000 |
|  |  |  |  |  | BNK Capital |  |  | 30,000 |  |  |  | 36,000 |
|  |  |  |  |  | Standard Chartered Bank Korea Limited |  |  | 20,000 |  |  |  | 24,000 |
|  |  |  |  |  | NH Capital |  |  | 20,000 |  |  |  | 24,000 |
|  |  | 3rd place | 2 |  | LOTTE Engineering & Construction |  |  | — |  |  |  | 736,921 |
| 1 | The Group provides a certificate of beneficiary rights for land classified as investment properties and inventory assets as collateral in connection with the above real estate collateral trust.
| 2 | The Group provides LOTTE Engineering & Construction with a certificate of third-priority beneficiary rights as collateral in relation to the construction contract amount of ￦ 614,101 million.
The Controlling Company is jointly and severally obligated with KT Sat Inc. to pay KT Sat Inc.’s liabilities incurred prior to spin-off. As at December 31, 2021, the Controlling Company and KT Sat Inc. are jointly and severally liable for reimbursement of ￦ 733 million. For the years ended December 31, 2020 and 2021, the Group made agreements with the Securitization Specialty Companies (2021: First 5G 55 th to 60 th Securitization Specialty Co., Ltd., 2020: First 5G 49 th to 54 th 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, 2021, the Group is a defendant in 219 lawsuits with the total claimed amount of ￦ 101,597 million (2020: ￦ 110,409 million). As at December 31, 2021, litigation provisions of ￦ 80,165 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 at the end of the reporting period. 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. At the end of the reporting period, the Group participates in Algerie Sidi Abdela new town development consortium (percentage of ownership: 2.5%) and has joint liability with other consortium participants . At the end of the reporting period, contract amount of property and equipment acquisition agreement made but not yet recognized amounts to ￦ 1,336,758 million (2020: ￦ 596,983 million). As the end of the reporting period, there are derivatives generated by the Group granting Drag-Along Right to financial investors participating in paid-in capital increase of K Bank (Note 7). For the year ended December 31, 2021, the Group entered into an agreement with the seller, who participated in the acquisition of shares in BOOK CLUB MILLIE. If certain conditions are not met in the future as disclosed in the terms and conditions of the agreement, the seller may exercise Tag-Along Right, Drag-Along Right and Put Option for the ordinary and redeemable convertible preferred shares it owns (Note 7). For the year ended December 31, 2021, the Group entered into an agreement with financial investors, who participated in the acquisition of shares in Epsilon Global Communications Pte. Ltd. If certain conditions are not met in the future as disclosed in the terms and conditions of the agreement, financial investors may exercise Tag-Along Right, Drag-Along Right and the right to sell shares for the convertible preferred shares it owns (Note 7). The Group has an additional investment obligation under the agreement to Future Innovation Private Equity Fund No.3 and others . For the year ended December 31, 2021, the cumulative investment amount is ￦ 25,611 million and USD 14,600 thousand, and the remaining amount of ￦ 8,109 million and USD 5,400 thousand will be invested in the Capital Call method later.

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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 2021-01-01 -Paragraph 10 -Subparagraph e -URI http://eifrs.ifrs.org/eifrs/xifrs-link?type=IAS&num=1&code=ifrs-tx-2021-en-r&anchor=para_10_e&doctype=Standard -URIDate 2021-03-24 + Details
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