---
title: "How to Start and Incorporate a Business in South Korea: A Complete Guide"
description: Discover how to start and incorporate a business in South Korea. Learn about local corporations, FDI companies, branch offices, and liaison offices. Get expert assistance from Pearson & Partners Korea.
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---

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# How to Start and Incorporate a Business in South Korea: A Complete Guide

![TaeHyoeng Kim](https://app.hubspot.com/settings/avatar/0e122dc71f3e34bd10ffccf842b3d0aa) 

[TaeHyoeng Kim](https://blog.pearsonp.com/author/taehyoeng-kim)

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Practically anyone, whether an individual or a foreign entity, can launch a business or incorporate a company in South Korea. The choice of business entity depends on the operational nature and adherence to relevant legal frameworks and regulations. To maintain the quality of our services, the initiation, registration, and incorporation processes in Korea are managed by certified Korean legal professionals.

**Foreign entities or individuals without South Korean residency have four primary options for starting and registering a business or company in the country:**

### **1. Local Corporation**

This registration type pertains to Korean-owned companies and is the most common form of incorporation in South Korea. It is available to both foreign nationals and Korean citizens. Unlike Foreign Direct Investment Companies (discussed below), there is no minimum capital requirement. A domestic Korean company can be established as any of the following business types:

- **Joint Stock Company (주식회사)**

A Joint Stock Company (Chusik Hoesa) is favored by foreign investors for setting up subsidiaries in South Korea. It is the only business entity in the country that can publicly issue shares. Shareholders have limited liability based on their initial capital investment, and shares can be transferred freely with board approval. Annual general meetings of shareholders are mandatory, and a statutory auditor oversees the company’s management and accounts.

- **Limited Liability Company (유한회사)**

A Limited Liability Company (Yuhan Hoesa) is another popular business type in South Korea, accommodating up to 50 shareholders. Shareholders' liability is limited to their share capital. Establishing a Limited Liability Company requires minimal conditions, such as at least one director and shareholder of any nationality, no minimum paid-up capital, and a registered office address.

### **2. Foreign Direct Investment Company**

Foreign individuals and companies can establish a local corporation as a Foreign Direct Investment Company (FDI). This option applies to various business types as previously mentioned. A minimum capital of 100 million KRW is required. FDI companies may receive certain benefits under Korean law based on their specific activities, which are not available to standard local Korean corporations.

### **3. Branch Office**

A Branch Office in South Korea operates as an extension of its foreign headquarters, legally considered a single entity with the parent company. Branch offices can engage in profit-generating activities in Korea and are subject to the same tax laws and rates as domestic Korean companies.

### **4. Liaison Office**

A Liaison Office is also recognized as a foreign corporation but focuses on non-commercial activities such as market research and promotional tasks for the parent company. Despite its limited scope, it must register with the appropriate tax office. It is a preferred option for foreign investors to establish a presence and evaluate the South Korean market before starting formal business activities.

### **Conclusion**

[**Pearson & Partners Korea**](https://pearsonkorea.com/contactus/) specializes in facilitating the establishment and incorporation of foreign enterprises in South Korea. From initial consultation onwards, we offer comprehensive support to help you choose the optimal company registration structure. Our services include document preparation, certification, authenticated translations, power of attorney, bank account setup assistance, VAT registration, and visa application support for foreign managerial personnel.

![TaeHyoeng Kim](https://app.hubspot.com/settings/avatar/0e122dc71f3e34bd10ffccf842b3d0aa)

#### TaeHyoeng Kim

With a major in Business Management from the University of Sheffield, I bring a strong academic foundation to my role at Pearson & Partners. At Pearson & Partners, I have been actively involved in the dynamic world of business expansion, incorporation, and tax accounting strategies.

### Leave a Comment

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