NXT Consortium Cleared of Tech Theft Allegations, Moves to Accelerate Fractional Investment Exchange Launch

The Korea Fair Trade Commission has cleared Nextrade (NXT) of allegations that it misappropriated technology from a startup, removing a key obstacle for the NXT Consortium as it moves to accelerate its bid for full licensing to operate a fractional investment over-the-counter exchange.

According to industry sources, the Fair Trade Commission notified the NXT Consortium on June 2 that it found no evidence NXT had used technology belonging to Lucentblock or engaged in any conduct that interfered with the company's business activities.

Lucentblock had filed a complaint with the Fair Trade Commission in January, alleging that NXT misappropriated its technology during the preliminary licensing process for the fractional investment OTC exchange. In response, the Financial Services Commission granted the NXT Consortium only a conditional preliminary license in February, stipulating that the full licensing review would be suspended if the Fair Trade Commission launched a formal administrative investigation into the alleged misuse of technology.

The Fair Trade Commission conducted an on-site investigation of NXT in April as part of its probe into whether the company had improperly used technology or interfered with a competitor's business activities.

According to NXT, the commission determined that the materials Lucentblock provided did not constitute technology and that there was no confirmed evidence NXT had used them. The commission also concluded that NXT had no purpose or intent to interfere with Lucentblock's business operations.

Because improper use of technology was not established, the commission further found that no causal link existed between Lucentblock's failure to obtain a license and any actions by NXT.

"With the Fair Trade Commission's findings resolving the obstacles related to licensing, the NXT Consortium plans to move forward with greater speed on its business operations and the full license application," an NXT official said.

The NXT Consortium plans to establish a corporation — tentatively named NexChange — with the goal of opening the market in the fourth quarter of this year. The consortium intends to proceed with investment approval, recruitment of qualified personnel, construction of a trading system, establishment of a market operations regime and acquisition of a full license. It also plans to build on the existing trading platform of consortium member MusicCow to improve transaction convenience and stability, and to expand the fractional investment market by offering a range of investment products including music royalties.