As a delisting system for so-called penny stocks whose share prices fall below set thresholds begins to be applied in earnest, affected companies have started legal action.

The Korea Exchange said on Oct. 23 that New Intech and Hyungji Global filed for injunctions at the Seoul Southern District Court to suspend the effect of delisting decisions related to failing share-price requirements.

As a result, liquidation trading procedures to delist the two companies will not proceed for the time being.

The exchange explained it will hold off on liquidation trading for the companies until conditions change, including a court decision on the injunction, to protect investors. It also plans to present its case in the injunction lawsuits that have been filed.

Liquidation trading is a procedure that provides investors in stocks set for delisting with a final opportunity to trade their shares. With the injunction applications, the delisting decisions themselves remain in place, but liquidation trading and subsequent delisting procedures will await the court's decision.

The exchange said it will continue to follow existing procedures through delisting decisions under the share-price requirement. If a company facing delisting files for an injunction to suspend the effect, it will hold off on liquidation trading until conditions change, including a court ruling.

That means the actual delisting timing for New Intech and Hyungji Global is expected to be determined based on the court's decision on the injunction.