Writer 관리자 Date 2011-07-21
 Title Corporation Establishment-How Foreigners Advance into Korea
 Content How Foreigners Advance into Korea

There are four types of a foreigner's advancement into Korea for the purpose of operating business: The establishment of a local corporation or a private business by a foreigner or a foreign corporation; or the establishment of a local branch or a local office in Korea by a foreign corporation.

1. How Foreigners Advance into Korea

Type Act Note
- Local Corporation: Foreign Investment Promotion Act / Recognized as a
foreign investment
- Private Business: same as above / same as above

- Branch : Foreign ExchangeTransactions Act / Categorized as a
domestic branch of the
foreign corporation
- Office : same as above / same as above



2. Comparison of a Foreign-Invested Company and a Domestic Branch

A Foreign-Invested Company under the Foreign Investment Promotion Act
Establishment of a local corporation in Korea by a foreign national or a foreign corporation is regulated by the Foreign Investment Promotion Act and the Commercial Act. A foreigner shall invest not less than 100 million won for the local corporation concerned to be recognized as foreign investment under the Foreign Investment Promotion Act.

Private business established by a foreigner with the investment of not less than 100 million won is also recognized as foreign investment under the Foreign Investment Promotion Act.

Domestic Branch of a Non-resident (a foreign company, etc.) under the Foreign Exchange Transactions Act
A 'branch' operates business that generates profits in Korea, and is not recognized as foreign direct investment.

An 'office' does not carry out business that generates profits in Korea, but instead undertakes a non-sales function such as market research, R&D etc. An 'office' is granted a distinct number, equivalent to business registration, at a jurisdictional tax office in Korea without the need for registration, which is different from a 'branch.'



It is quoted from http://www.investkorea.org/