How to establish a company in South Korea?

Introduction

What is "Foreign Investment"?

Foreign-Investment means where a foreigner holds stocks or shares of a Korean corporation. Both Private and corporate foreign investors can be shareholders.
To be regarded as Foreign Investment, (1) the investment amount shall be at least KRW 100 million, and (2) a foreigner shall own at least 10% of either the total number of voting stocks issued by a Korean corporation.

There are some categories of businesses in which foreign investment is prohibited or restricted: Matters determined as threats to national security such as defense material.

Process

Setting up a company in South Korea consists roughly of 4 steps.

1. Remit Capital
2. Notify Foreign Investment to a bank
3. Incorporation and Business Registration
4. Foreign-Invested Enterprise Registration

Each procedure is described in detail below.

(1) Remit Capital

The investment capital can be remitted to a non-resident account in foreign currency or a temporary account.

After the transaction is completed, the bank shall issue a securities subscription deposit certificate which is required when you register your incorporation.

(2) Notify Foreign Investment

"Why should notify?"

(a) Remittance shall be guaranteed as the notification clearly shows the purpose of the capital transfer.
(b) Certificate of foreign investment notification is needed when you register incorporation and business.

"Where to notify?"

A designated foreign exchange bank in South Korea

(3) Incorporation & Business Registration

Firstly, you will register incorporation at a district court within jurisdiction. When registered, a corporation becomes a legal entity which is separate and distinct from its owners.

And then, you will notify and register your business at a tax office within jurisdiction.

(4) Foreign- Invested Enterprise Registration

Upon submitting an application, a foreign-invested company registration certificate shall be issued, which is required when you apply for a D-8 Visa(business investment).

In addition, the certificate also enables the overseas remittance of investment profits simplified.

"Where to register?"

A designated foreign exchange bank in South Korea

"Why should register?"

As the purpose of the Foreign Investment Promotion Act is to promote foreign investment in Korea by providing necessary support and benefit and to contribute to the sound development of the nation's economy, benefits are given if an investment is the foreign investment defined in the Act.

"What are the benefits?"

(a) Tax incentives

Acquisition tax, registration tax, property tax and aggregate land tax may be reduced or exempted.

(b) Cash grants

A local government and the State may provide cash grants when constructing new factories under certain circumstances (i.e. effect of technology transfer, scale of job creation).

(c) Lease or sale of State or public property

The State and a local government may allow a foreign-capital invested company to use or to earn profit from land which the State or local government owns at a reasonable price.

Timeline

1. Transfer Capital into a temporary account

2. Prepare and send required documents to HWAUM Law Office (D+3)

[ADDRESS]

Jaekwon JUNG, HWAUM LAW Office, 14F, 427 Teheran-ro,

Gangnam-gu, Seoul, South Korea 06159

HWAUM LAW

이 블로그 검색