Most foreign companies entering Korea think of regulation as paperwork. File the notification, get the certificate, move on. That holds right up until the target company turns out to hold a designated technology, at which point the Ministry of Trade, Industry and Energy acquires the power to suspend your transaction, prohibit it, or order it unwound after the fact.
There are 76 National Core Technologies. There are 19 National High-Tech Strategic Technologies. Between them they cover semiconductors, displays, secondary batteries, automobiles, shipbuilding, nuclear power, space, biotechnology, robotics, hydrogen and defence. If that list sounds like a description of the Korean economy, that is the point.
Here is how the regime actually works, and where foreign buyers get caught.
The single biggest mistake is treating Korean investment screening as one filing. It is three separate regimes that can all bite on the same deal.
| Law | What it governs | Who reviews |
|---|---|---|
| Foreign Investment Promotion Act (FIPA) | Inbound foreign investment generally, plus national security review | MOTIE, with notifications filed at a designated foreign exchange bank |
| Industrial Technology Protection Act (ITPA) | Overseas M&A of companies holding National Core Technologies | MOTIE's Industrial Technology Protection Committee |
| National High-Tech Strategic Industries Act (NHTSIA) | Overseas M&A involving National High-Tech Strategic Technologies | MOTIE |
FIPA is the one everyone knows. The other two are where deals die, and they are filed by the target company rather than by you, which is precisely why they get missed in a foreign buyer's deal checklist.
Structuring a Korean investment and need the regulatory path mapped before you sign? Talk to Pearson & Partners Korea.
| Trigger | Threshold | Consequence |
|---|---|---|
| Foreign investment notification | Acquiring 10% or more of voting shares, or gaining a right to appoint officers, where the amount is at least KRW 100 million | Notification required |
| Defence industry company | Investment in a company MOTIE has designated as such | Advance approval required |
| National security concern | Foreign investor gains de facto control and security concerns arise | Security review. MOTIE can start one on its own initiative |
| National Core Technology (76 designated) | Overseas M&A of a company holding one | Notification. Approval if the technology was developed with government R&D funding |
| National High-Tech Strategic Technology (19 designated) | Overseas M&A involving one | Approval required |
Note the 10% figure. Foreign investors routinely assume screening attaches at control, or at a majority stake. Under FIPA the notification obligation starts at a tenth of the voting shares, and the monetary floor is KRW 100 million, which is a threshold set by regulation and revised periodically rather than a permanent number.
For the technology regimes, "overseas M&A" means acquiring 50% or more of the shares, or less than 50% where the investor becomes the largest shareholder with dominant influence over management. A minority stake with board control counts.
| National Core Technologies | National High-Tech Strategic Technologies | |
|---|---|---|
| Count | 76 | 19 |
| Sectors | Semiconductors, displays, automobiles, shipbuilding, nuclear power, space, biotechnology, robotics, hydrogen and others | Semiconductors, displays, secondary batteries, biotechnology, robotics, defence |
| Default obligation | Notification | Approval |
| Escalates to approval when | The technology was developed with government R&D subsidies | Always |
Both lists are expanding. Treat a technology search at signing as a point-in-time answer rather than a settled one, and diligence the government funding history of the target's R&D, because that single fact is what converts a notification into an approval you have to win.
This table is the one to send to your deal team.
| Filing | Who files | Timing |
|---|---|---|
| FIPA notification | The foreign investor | After signing, before remitting funds. Listed-share acquisitions may be reported within 60 days of closing, unless national security review applies |
| ITPA notification or application | The target company | In connection with the overseas M&A |
| NHTSIA notification or application | The target company | In connection with the overseas M&A |
| Security declaration | The foreign investor | Investors must state whether the deal could threaten national security |
The split matters commercially. Two of the three filings sit with the seller's company, but the consequence of a failed or late filing lands on your transaction. That belongs in the sale and purchase agreement as a condition and a covenant, not in a post-signing to-do list.
| Process | Statutory period |
|---|---|
| FIPA approval | 15 calendar days, extendable by a further 15 |
| Security review, preliminary stage | Within 90 days, extendable once by 30 |
| Security review, MOTIE decision | A further 45 days |
| NCT or NHTST notification | 15 days for MOTIE, excluding technical examination time |
| NCT or NHTST approval application | 45 days, excluding technical examination time |
| Pre-confirmation request | MOTIE responds within 30 days unless more documentation is needed |
Read the exclusions carefully. "Excluding technical examination time" means the clock on a technology review is not the clock you can plan a closing around. A full security review can run 90 plus 30 plus 45 days, which is most of a year once document requests are included.
The pre-confirmation route is underused. Thirty days for an advance view from MOTIE is cheap compared with discovering the issue in week six of exclusivity.
These are not administrative fines treated as a cost of doing business.
"Restoration" is the word to sit with. It means a completed transaction being unwound.
A FIPA amendment bill introduced in 2025 would widen the regime in two significant ways. It would bring indirect investment made through an existing foreign-invested enterprise into scope, closing the route of investing via a Korean subsidiary you already own. It would also require prior notification for security-reviewable transactions, ending the post-closing reporting option for those deals.
The bill has not been enacted. Plan on the direction of travel rather than the current text, because the National Core Technology and High-Tech Strategic Technology lists are expanding independently of it, and MOTIE established an FDI Execution Support Taskforce in 2025 to guide investors through approvals, which signals volume rather than leniency.
None of this applies in the same way to establishing your own company. Incorporating a new Korean entity triggers FIPA notification, which is routine, but it does not put you into ITPA or NHTSIA territory, because there is no target company holding a designated technology.
Where an acquisition is being considered primarily for speed of market entry, the screening timeline can erase the advantage entirely. A greenfield entity can be registered in weeks. A security review can run most of a year.
Pearson & Partners Korea's incorporation service sets up your own Korean entity, which is frequently the faster route once screening is priced into an acquisition timeline.
The FIPA notification that applies to every foreign investment, acquisition or not, is covered in foreign investment reporting in Korea.
If you are weighing greenfield entry, see our guide to Korea company setup and business structures, our comprehensive guide to business incorporation in South Korea, the Korea business registration requirements and process guide, our comprehensive guide to Korea company registration for entrepreneurs, and Korea business formation setup costs and requirements. A branch is the lighter-touch alternative, covered in Korea branch registration and how it differs from a subsidiary.
On governance, you do not need a Korean resident director, and on banking, the 20-day rule catches most new entities out. Founders relocating should read the D-8 visa requirements guide, and rates changed this year in Korea Corporate Tax 2026.
If you only need people in Korea rather than an entity or an acquisition, an Employer of Record arrangement avoids the question altogether.
Pearson & Partners Korea handles company incorporation and branch registration for foreign companies, alongside foreign investment reporting under the Foreign Investment Promotion Act, corporate tax and accounting, Employer of Record (EOR), payroll and the four mandatory social insurances, and visa advisory including D-8 sponsorship.
Where a deal touches the screening regimes, we work alongside Korean counsel rather than in place of them, because an approval you have to win is a legal matter and should be run as one.
More at pearsonkorea.com and our Insights hub.
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Official and authoritative sources: the Ministry of Trade, Industry and Energy administers all three regimes and designates the technology lists. Invest KOREA and KOTRA handle foreign investment notification and support. The Korea Legislation Research Institute publishes the official English translations of the Foreign Investment Promotion Act and related statutes. White & Case's 2026 review of Korean foreign direct investment screening sets out the thresholds, timelines and penalties cited above.
Does Korea screen foreign investment?
Yes. Three regimes apply: FIPA for foreign investment generally and national security review, the Industrial Technology Protection Act for National Core Technologies, and the National High-Tech Strategic Industries Act for strategic technologies.
What percentage triggers a foreign investment notification in Korea?
Acquiring 10% or more of voting shares, or gaining a right to appoint officers, where the investment is at least KRW 100 million.
How many technologies are designated?
76 National Core Technologies and 19 National High-Tech Strategic Technologies, across semiconductors, displays, batteries, automobiles, shipbuilding, nuclear, space, biotechnology, robotics, hydrogen and defence.
Who files the technology notifications, the buyer or the target?
The target company files the ITPA and NHTSIA notifications or applications. The foreign investor files the FIPA notification.
Can Korea block or unwind a completed acquisition?
MOTIE can issue suspension, prohibition or restoration orders, and restoration means unwinding a transaction.
How long does a Korean national security review take?
Up to 90 days for the preliminary review, extendable once by 30 days, then a MOTIE decision within 45 days.
What are the penalties for failing to notify?
Up to three years' imprisonment for notification violations, and up to five years for breaching national security restrictions.
Does screening apply if I set up my own company instead?
Establishing a new entity triggers routine FIPA notification but does not engage the technology regimes, since there is no target company holding a designated technology.
Can I get an advance ruling?
A pre-confirmation request can be made, with MOTIE responding within 30 days unless further documentation is required.
This article is general information, not legal advice. Screening outcomes turn on specific facts, designations change, and a FIPA amendment bill is pending. Take Korean legal advice before signing.
Tags: Korea FDI screening, Korea foreign investment review, Korea national security review, National Core Technology Korea, NHTSIA Korea, Industrial Technology Protection Act, MOTIE approval, Korea M&A foreign investor, Foreign Investment Promotion Act, Korea acquisition approval, Korea incorporation, Korea company registration, Korea business registration, foreign direct investment Korea, Korea branch registration, Korea market entry, EOR Korea, Pearson Partners Korea