Guide to establishing a foreign investment corporation: Information and procedures for foreign investment

2024-04-06BY Immikorea

Establishing a Foreign Investment Corporation

If a foreigner or foreign company invests KRW 100 million or more to participate in the management of a business and acquires 10% or more shares with voting rights, it is classified as a foreign-invested business. Once classified as a foreign-invested company, it is recognized as a domestic corporation and has rights and status under domestic law.

The types of foreign business entities in Korea include foreign-invested corporations, branches, and liaison offices, which can be compared below.

외국인 회사 설립 유형 비교

Procedures and time frame for establishing a foreign investment corporation

A foreign investment corporation can be established through an agent with a notarized power of attorney without entering Korea.

Procedure	How long does it take
Prepare notarized documents (headquarters or personal)
⇒ Foreign Investment Report (KOTRA or Foreign Exchange Bank)	1 day
⇒ Remittance of investment funds (foreign exchange bank, customs carry-on)	2-3 days
⇒ Registration of incorporation (court registry)	3-5 days
⇒ Obtaining a license (Related Industries)	variation
⇒ Incorporation and Business Registration (Tax Office)	2-3 days
⇒ Corporate Bank Account Opening (Foreign Exchange Bank)	1 day
⇒ Issuance of Foreign Investment Company Registration Certificate (KOTRA or Foreign Exchange Bank)	1 day
⇒ D8 visa processing (if required)	1 month minimum

Documents required to establish a foreign investment corporation

Documents issued abroad require an apostille or consular notarization.

Personal investments – passport copy, ID
Investing in foreign entities – Certificate of incorporation, articles of incorporation, board of directors, shareholder list
Foreign Investment Report
Articles of Incorporation
Shareholder List
Inauguration acceptance letter
Notarize representative’s address, notarize signature
Office lease contract
Power of Attorney

If you are applying for a D8 visa at the same time, you will need additional documentation.

Employee hiring and tax obligations for foreign-invested corporation

As a foreign-invested corporation, it is a domestic corporation and its hiring procedures and accounting books must be kept in accordance with Korean accounting standards. It is liable to pay corporate taxes and all profits generated by the corporation are aggregated and taxable.

In some regions, there are tax incentives for foreign-invested enterprises, small and medium-sized enterprises, and loans are available depending on the creditworthiness of the entity.

Sending Executives and Employees on a D8 Visa

If you are an individual investor, apply for a D8 visa with yourself as the representative
If the investment is made by a foreign entity, you can send officers and employees on a D8 visa.

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