Procedure for Establishing a Local Corporation
The followings are the four steps to establish a local subsidiary
(1) Foreign Investment Notification
(2) Incorporation Registration (Private business Registration)
(3) Business registration (jurisdictional tax office)
(4) foreign-invested business registration
The previous procedure is technically the same as the incorporation procedure applied to Korean citizens, except for the following steps: the foreign investment notification before the incorporation procedure and the foreign-invested company registration after the incorporation registration.
MAY 16, 2023
JULY 7, 2023
Procedure for Establishing a Local Corporation
Foreign Investment Notification
(1) Notifier: Foreign investor or its proxy
* A power of attorney is necessary when a proxy completes a notification.
(2) Where: Korea, oversea investment KBCs of Korea, head office or branches of domestic bank or domestic branches of foreign banks
(3) Documents required:
Notification form of foreign investment in the form of acquisition or contribution of new shares
Individual Investor - Documents certifying investor's nationality (copy of passport)
Corporate Investor - Incorporation Certificate (Certificate issued by a foreign government agency, such as the Ministry of Commerce)
A power of attorney (when a proxy completes a notification)
(4) Processing time: on site
Remittance of Foreign Investment Capital
(1) Capital Remittance:
The capital can be sent to domestic banks from overseas or hand-carried through customs.
The capital is required to be declared at the customs office, where the certificate of declaration of foreign currency will be given.
(2) Remittance Account
A temporary account number is issued by a designated foreign exchange bank
Even without an account number, you can send and receive capitals using his or her or the bank’s information.
(3) Foreign-invested capital transferred will be converted into Korean currency and then transferred to a deposit account for the payment of stocks (securities subscription deposit account).
(4) Banks issue the securities subscription deposit certificate, which is necessary for the registration of incorporation.
※ In general, banks request the notarized forms of the articles of incorporation, the minutes of inaugural meetings, the minutes of board members meeting, and the certificate of stock receipt. However, this step differs from each bank, so you might want to check with your bank in advance.
4. Incorporation Registration
See the "Incorporation Registration” part.
5. Business Registration
See the "Business Registration: part.
6. Transfer of the paid-in capital to a corporate account
Once the incorporation registration and the business registration are completed, the company will become a legal entity and the paid-in capital deposited in the temporary account can be transferred to the corporate account.
※ When transferring the capital to the company account, the following documents are required: a certified copy of corporate registration, a certification of corporate seal impression, a corporate seal impression, a copy of business registration certificate, a seal for the account, an original copy of the representative director’s personal identification document. Please check with your bank in advance about the required documents as the lists of required documents vary depending on a bank.
7. Registration of foreign-invested companies
(1) Registration destination: the same place as the foreign investment notification was registered
(2) Registration Period: In 30 days from the day when the investment object has been fully paid
※ Usually, it is registered after receiving the business registration certificate from the jurisdictional tax office.
(3) Documents required (1 copy each):
○ Application form for foreign-invested company registration (see the appendix)
○ Original certified copy of corporate registration
○ Copy of certificate of purchase or deposit of foreign currency
○ Shareholder ledger
(4) After submitting the application along with the above documents, a foreign-invested company registration certificate will be issued. A certificate is required in the following cases.
○ Overseas remittance of investment returns or profit
* Once presenting a copy of foreign-invested company registration certificate, a certificate of resolution of the board of directors (with the dividends payout details stated) and a financial statement audited by a certified accountant, a foreign investor can remit the investment returns or profit overseas. This procedure has become much more simplified than the general overseas remittance.
○ D-8(business investment) Visa application:
※ Application for D-8 visa
① Destinations: Korea's investment consulting center, jurisdictional immigration office, Korean consulate generals abroad (except for Chinese citizens)
∙ Korea 's Investment Consulting Center: To change the visa status into visa D-8
∙ Immigration Office: Issuance of certificate for visa issuance confirmation and change of the visa status into visa D-8
② Documents required: a copy of certificate of completion of foreign investment notification, a certificate of foreign-invested company registration, a certified copy of corporate registration(or a a copy business registration certificate, a dispatch order (or an employment certificate), passport, visa application form, etc.