The South Korean appellate court finds Lee Jae-yong guilty of bribery on 18 January. The heir of Samsung and son of the deceased company chairman Lee Kun-hee, is sentenced to 30 months in prison. The verdict comes after a three-year trial over allegations that Lee tried to bribe someone in President Park Geun-hye’s office in 2017.
Samsung’s uncertainty vacuum and what it means
Lee’s incarceration will result in a vacuum in the company and is likely to reflect on the company’s overall performance. Insiders say that Samsung without proper leadership will make it difficult for the company to compete against rival companies like Apple.
Uncertain at how Samsung will withstand the blow, Senior executives are looking for someone to run the company efficiently and keep it at the top. Samsung’s sales equivalent is about a fifth of the country’s GDP (gross domestic product).
Bribery paid back
In 2017, Samsung was accused of paying 43 billion won ($37.7m; £26.7m) to two non-profit foundations managed by Choi Soon-sil, a friend of former South Korean President Park Geun-hye, in exchange for political support.
The alleged bribery sought backing for a controversial Samsung merger between Samsung C&T and Cheil Industries in 2015, which paved the way for Lee to take control of the Samsung Electronics conglomerate his grandfather founded. It was a deal that needed support from the government-run National Pension Service.
Lee rebuffed the charges but admitted making donations. He denied Samsung sought for a favor in return. However, with strong evidence from the prosecution, in August 2017, a court convicted him of the charges and sent him to prison for five years.
The sentence was halved in February 2018, and Seoul High Court suspended the jail term, which meant he was free to go. He will serve the remaining sentence from hereon.