Samsung leader Lee arrives for questioning by prosecutors

Samsung Group leader Jay Y Lee appeared at the South Korean special prosecutor's office on Thursday for questioning on suspicion of bribery in an influence-peddling scandal that may force President Park Geun-hye from office.

The country's top conglomerate has become important in the investigation of Park, who was impeached by parliament in December over the corruption scandal. She would be the country's first democratically elected leader to be removed from office early if the Constitutional Court upholds the impeachment.

Park has denied wrongdoing.

"I am very sorry to the South Korean people for not showing a better side," Lee told reporters as he arrived at the prosecution office in a black Korean-made Ssangyong sedan, greeted by protesters holding signs calling for his arrest and accusing him of being the president's accomplice.

Parliament impeached Park over allegations she allowed a friend, Choi Soon-sil, to exert inappropriate influence over state affairs.

Choi is accused of colluding with Park to pressure big businesses, including the Samsung Group, to contribute to non-profit foundations backing the president's initiatives.

Choi, on trial on charges of abuse of power and attempted fraud, has denied wrongdoing.

Prosecutors named Lee a suspect on Wednesday and they are investigating whether Samsung gave 30 billion won ($25.28 million) to a business and foundations backed by Choi in exchange for the national pension fund's support for a 2015 merger of Samsung C&T Corp and Cheil Industries Inc.

Lee has denied bribery.

Wearing a dark suit, white shirt and dark red tie, Lee bowed after making brief remarks to reporters.

Proving improper dealings between Park, or her confidant Choi, and Samsung would be key for the prosecutors' case, analysts said, noting their goal is to prove Park or her surrogates such as Choi took bribes from corporations in exchange for favours.

The prosecution spokesman on Wednesday would not rule out the possibility of investigators seeking an arrest warrant for Lee, 48, who in December denied accusations the conglomerate sought to curry the favour of Park or Choi to secure the 2015 merger, a deal seen as critical for ensuring his control of the conglomerate.

Investigators questioned two senior Samsung Group executives this week as witnesses.

Impeachment

The scandal has triggered weekly rallies calling for Park to step down. She has apologised and said this month the pension fund's support for the Samsung companies' merger was in the national interest.

If Park were to leave office, a presidential election would be held within 60 days. Among the expected contenders is former UN Secretary-General Ban Ki-moon.

Lee took over as leader of the smartphones-to-pharmaceuticals conglomerate after his father, founding family patriarch Lee Kun-hee, had a heart attack in 2014.

Jay Y Lee's arrest or indictment would be a blow to Samsung and the family, which has been streamlining its business to ensure a stable transfer of control from the ailing Lee Kun-hee to his children.

While analysts and investors said management would be able to keep the various affiliates including Samsung Electronics Co Ltd in good shape, the conglomerate as a whole may be slower to commit to major investments or acquisitions should Jay Y Lee be imprisoned.

Share prices of most Samsung companies showed muted reaction to Lee's implication in the scandal, however. Samsung Electronics shares were trading flat around mid-day on Thursday and Samsung C&T shares were up 0.8 percent, compared with a 0.3 percent rise for the broader market.

"It's possible that Samsung Group companies will try to behave more transparently in response and operate in a more fair manner that shareholders can rationally understand," said IBK Asset Management fund manager Kim Hyun-su.