Step-by-Step Guide to Korea Business Registration for Foreign Investors
Establishing a Business in South Korea: A Comprehensive Guide
The South Korean government actively encourages foreign direct investment (FDI) through a range of incentives and support initiatives. Foreign businesses can benefit from tax exemptions, cash grants, and subsidies, especially in designated free economic zones and strategic business hubs. Furthermore, South Korea’s transparent legal system and streamlined company registration processes make it a favorable destination for international enterprises.
How to Register a Business in South Korea
1. Selecting the Appropriate Business Structure
Choosing the right business structure is essential for determining liability, management responsibilities, and operational scope.
2. Choosing a Company Name
Select a unique, memorable name that aligns with your brand identity and complies with local naming regulations.
3. Registering the Company Name
Register your chosen name with the South Korean company registry to secure it for official use.
4. Drafting Articles of Association
Prepare a notarized document outlining the company’s purpose, governance structure, and shareholder rights.
5. Submitting Incorporation Documents
File all necessary documentation, including the certificate of incorporation, with the relevant authorities.
6. Securing a Business License
Obtain the required license to operate legally within South Korea.
7. Completing Tax and Social Security Registration
Register with the National Tax Service and National Pension Service to fulfill tax and social security obligations.
8. Maintaining Compliance
Ensure ongoing adherence to legal requirements, including filing annual reports and conducting shareholder meetings.
Steps to Establish a Limited Liability Company (LLC) in Korea
Foreign investors looking to form a Limited Liability Company (LLC) in Korea can follow these steps:
1. Notify the Foreign Exchange Bank (FEB):
Submit a notification of your investment intention along with identity verification to a branch of an FEB.
2. Transfer Initial Capital:
Send capital from an overseas account or deposit it locally into a temporary account, then obtain a bank certificate confirming the transaction.
3. Register the Company:
File incorporation documents with the Korean court, providing detailed information about directors, auditors, and shareholders.
4. Complete Tax Registration:
Register the company with the appropriate tax authorities.
5. Open a Corporate Bank Account:
Transfer the initial capital from the temporary account into the company’s official corporate account.
6. Register as an FDI Company:
Apply for Foreign Direct Investment (FDI) registration within 30 days of the capital deposit.
Conclusion
Establishing a company in South Korea requires careful planning, understanding of local regulations, and selection of a business structure that aligns with your objectives. By ensuring compliance with registration and operational requirements, foreign investors can establish a foothold in one of Asia’s most dynamic economies.
At Pearson & Partners Korea, we provide end-to-end support for company incorporation, guiding you through every step of the process to ensure smooth registration and compliance. Contact us today for personalized assistance tailored to your business goals. Get in touch with us to learn more.
