Writer 관리자 Date 2011-07-21
 Title Corporation Establishment-Local Corporation Establishment
 Content The procedures for the local corporation establishment by a foreign investor are mostly similar to those for domestic corporation establishment except for the pre-report of foreign investment and the registration of a foreign-invested company.

1.The Procedure for Local Corporation Establishment

The procedures of local corporation establishment consist of foreign investment report, registration of a stock company or private business, and registration of a foreign-invested company, which are the same with the foreign investment procedures. The following includes the details of company establishment and business registration procedures which are significant in establishing a local corporation.


Foreign Investment Notification(Invest KOREA(KOTRA),foreign exchange bank)-> Investment Fund Remuttance(foreign exchange bank carried in through customs)->Corporation Establishment Registration(Court Registry)

Foreign Invested Company Registration->Paid-In-Capital Transfer to Corporate Account(foreign exchage bank) -> Corporation Establishment Notification & Business Registration(headquarters district tax office)



2.The Procedure for Stock Company Establishment

Partnership company, limited partnership company, stock company, limited liability company are recognized as companies under the Commercial Act. As most companies fall into the category of "stock company," the procedures of stock company establishment will be explained here.

-Types of Stock Company Establishment
There are two types of stock company establishment: promotion of incorporation and subscriptive incorporation. Promotion of incorporation means that promoters subscribe for all of the shares issued at the time of incorporation. Subscriptive incorporation means promoters do not subscribe all the shares issued at the time of incorporation and offer shares for subscription.

-Registration of Incorporation of Stock Company
The registration of incorporation of a stock company shall be effected within two weeks from the day when the investigation in the process of establishment has been completed in cases where the promoter subscribed for all the shares issued at the time of incorporation, and within two weeks from the day on which the inaugural general meeting has been closed in cases where the promoters have offered shares for subscription.

The composition of promoters and whether the trade name or title has been used by other companies shall be reviewed before the registration. A stock company requires one or more promoters. The promoter shall subscribe for shares in writing and may subsequently become a shareholder of the newly created company. Since no trade name which has been registered by another person shall be registered as a trade name of the same kind of business in the same Seoul Special Metropolitan City, Metropolitan City, and city/gun, the company name shall be checked in advance on the Supreme Court website (www.iros.go.kr).


**Required Documents in Registration of Incorporation

1. Application for the registration of the incorporation of a stock company
2. Articles of incorporation (It shall be notarized by a public notary - Notarization is exempted where the total capital of the newly incorporated stock company is less than one billion won.)
3. Documents certifying subscription for shares
4. Subscription form (in the case of subscriptive incorporation )
5. Written consent to matters concerning issuance of shares
6. Written consent to shorten the period the notice of convocation is dispatched before the date of the inauguration general meeting
7. The minute of the inaugural general meeting (It shall be notarized by a public notary. Notarization is exempted where the total capital of the newly incorporated stock company is less than one billion won.)
8. The minute of the Board of Directors (It shall be notarized by a public notary. Notarization is exempted where the total capital of the newly incorporated stock company is less than one billion won.)
9. A certificate of paid-up stocks
10. An investigation report of a director, auditor, or the audit committee
11. Certificate of the delivery of pertinent property (in the case of investment in kind)
12. The public notary's report on particulars of abnormal incorporation
13. A written statement by an appraiser
14. A certified copy of the report by an inspector
15. Report certificate of foreign investment
16. Certificate of inauguration acceptance
a. A Korean national shall put his/her seal on the certificate, and attach a certificate of the seal and a certified copy of of resident registration
b. A foreigner national shall attach a notarized original signature and certificate of the address and a copy of the passport
17. A certificate of the registration of a seal impression
18. Translation of documents (In case where the required documents including the directors inauguration acceptance are written in a foreign language)
19. A certificate of paid registration tax (issued by a district office which has jurisdiction over the area where the headquarters is located)
20. Revenue stamp of Supreme Court of Korea
21. The power of attorney (where an agent makes the report)
22. Seals of each director and promoter (including foreigners)
23. Corporate seal
24. Application form for corporate seal card (after the registration of incorporation)

* The foregoing 11, 12, 13 and 14 are applied in cases where there are particulars of abnormal incorporation, such as in-kind investment.


-Required documents for a foreign investor
The documents a foreign investor shall submit differ, depending on whether the investor concerned is an individual or a corporation. A foreign investor of Japan and Taiwan shall submit the same documents with a national of the Republic of Korea and a Korean corporation.


<Required Documents for Individual Investors>
1. A certificate of inauguration acceptance :
For all individuals registered as a director
-Investors of the Republic of Korea, Japan, and Taiwan shall place their seal on the certificate of inauguration acceptance
-Investors from other foreign countries shall place their seal on the certificate of inauguration acceptance and have the certificate notarized

2. A certificate of seal impression & A certified copy of resident registration :
The certificates are attached to the power of attorney and the certificate of inauguration acceptance
-Investors of the Republic of Korea, Japan, Taiwan: A certified copy of resident registration and a certificate of seal impression
-Investors from other foreign countries: A certificate of address which has been notarized at the place of residence, and an original certificate of signature

3. Power of attorney:
For all investors, directors, etc. whose names are written on documents
-Investors of the Republic of Korea, Japan, Taiwan shall put their seal on the power of attorney
-Investors from other foreign countries shall put their sign on the power of attorney and have it notarized

4. Passport copy:
All foreigners


<Required Documents for Corporate Investors>
1.Power of attorney:
For all investors, directors, etc. whose names are written on documents
-Investors of the Republic of Korea, Japan, Taiwan shall put their seal on the power of attorney
-Investors from other foreign countries shall put their sign on the power of attorney and have it notarized

2. A certificate of inauguration acceptance :
For all individuals registered as a director
-Investors of the Republic of Korea, Japan, and Taiwan shall place their seal on the certificate of inauguration acceptance
-Investors from other foreign countries shall place their seal on the certificate of inauguration acceptance and have the certificate notarized

3. A certificate of seal impression & A certified copy of resident registration :
The certificates are attached to the power of attorney and the certificate of inauguration acceptance
-Investors of the Republic of Korea, Japan, Taiwan: A certified copy of resident registration and a certificate of seal impression
-Investors from other foreign countries: A certificate of address which has been notarized at the place of residence, and an original certificate of signature

4. A certified copy of corporation registration & Corporate power of attorney :
Corporations of the Republic of Korea and Japan shall put their corporate seal on the power of attorney and attach one copy of a certificate of corporate seal impression and a certified copy of corporation registration each

Corporations from other foreign countries: Representative directors of foreign investment corporations shall put proxy signature on the power of attorney to representative directors of corporations to be established in Korea; have the document notarized; have a certificate of corporation notarized; and have them attached

5. Passport copy:
All foreigners

-Stock Company Establishment Costs
Registration tax, local education tax, registration application fees etc. are the costs involved in establishing a stock company.

<Case of Company Establishment Cost(100 million won in capital, in a large city)>
1. Registration Tax: 0.4% of the capital, 3 times when a stock company is established in large cities/ 1,200,000 won
2. Local Education Tax: 20% of registration tax/ 240,000 won
3. Revenue Stamp of Supreme Court : Fee for registration application / 30,000 won
4. Notarization Fee: Articles of association, etc. (exempted in case of promotion of incorporation whose capital is KRW 1 billion or less)/ Approx. 150,000 won

--->Total: Approx. 1,620,000 won


-Corporation Establishment Report and Business Registration
Generally, the corporation establishment report and application for business registration are conducted simultaneously. Report and application may be carried out at a jurisdictional tax office of the company headquarters, or at Invest KOREA (KOTRA). The corporation establishment shall be reported within 2 months after the corporation establishment registration, and business registration shall be done within 20 days after the commencement of business operation.

*Required Documents
-Corporation establishment report and business registration form
-Articles of association (Specifications of object of investment shall be attached in case of investment in kind)
-A certified copy of corporate registration
-Specifications of shareholders etc.
-A certificate of permission for business (where the business requires permission, authorization, report etc.)
-A copy of rental contract (where workplace is rented)
-Others
- Report form of the appointment of a tax agent (where there are no directors and employees to handle matters related to domestic tax)
- A copy of certificate of foreign currency purchase
- A copy of certificate of alien registration or a copy of passport (where the representative is a non-resident)


In cases where a foreign investor makes an investment in kind to establish a corporation, a certificate of business registration is required to receive value added tax refund when the object of investment in kind clears customs. Therefore, the business registration has to be completed prior to the import of investment object.

-Required Documents in cases where business registration is conducted in advance (for investments in kind)
-Application form of business registration
-Certified copies of resident registration of all promoters
- Application form for business permission (where the business requires authorization and permission)
- Business plan
* A certified copy of corporation registration is not required when applying for business registration, while all other required documents shall be submitted after establishing the company.




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