Starting a Business in South Korea

Information on starting a business in South Korea, different types of business structures and the legal processes involved in setting up a business...

The Invest Korea website is a good starting place to find information about business in South Korea.

  • For a summary of the procedures and costs for setting up a business in South Korea: Click here

South Korea encourages foreigners to invest directly or indirectly in its economy. In 1998, South Korea enacted the Foreign Investment Promotion Act in order to promote foreign investment in South Korea. It provided foreign investors with many incentives, such as tax relief, cash grants, support of industrial sites, financial support, and so on.

An individual seeking to start a business or invest in South Korea should have one of the following:

  • a D-8 (Corporate Investment) visa
  • an F-5 (permanent residence) visa
  • an F-6 (marriage immigration) visa

According to the Foreign Investment Promotion Act, at least KRW 100 million must be invested to get a D-8 visa.

Korean Business Organisations

The Korean Commercial Act provides for two main types of business organisations:

  1. Private businesses.
  2. Corporations

Corporations are divided into four sub types:

  1. General Partnership (Hapmyeong Hoesa).
  2. Limited Liability Partnership (Hapja Hoesa).
  3. Joint Stock Corporation (Chusik Hoesa).
  4. Limited Liability Corporation (Yuhan Hoesa).

Private businesses are forbidden by law from using the term "Hoesa" (company or corporation) as part of their title, because this might mislead consumers.

Information provided by Yun Je Lee, Associate Professor at Ajou University School of Law Attorney at Law in South Korea/California