Doing business in Korea is not about ‘What is Good?’ but it is all about ‘Why Wait if it is So Good?’
Korea is one of the liveliest and happening
countries around the globe. Within a period, after its sensational and outstanding
development, it has successfully retained its extraordinary history and heritage
and also absorbed all the facilities and technology of the present times.
Korea is just the right place for the operational requirements of your business and also one that
offers the best quality of life. A premium framework for MICE (Meetings,
incentives, conferences and exhibitions), a secure and maintainable meeting place,
a range of exclusive places to visit and experiences to appreciate and a lot more
is provided by the MICE cities of the Republic of Korea.
The South Korean government has taken a number of steps since the last few years to attract more investment and entrepreneurs. The country is loaded with opportunities in various sectors, specifically electronics, agro foods, engineering, and automobiles.
If you are a foreign entrepreneur wanting to set up or run a sole business or a partnership/joint venture in South Korea, you will require a business or partnership visa. An application must be presented to the Korean embassy or consulate in your country (see Visa section).
A residence permit is also required from the South Korean immigration department. This takes a great deal of research and connecting with the authorities to know the type of business in South Korea that is best for you.
An entrepreneur can select from five different types of businesses in South Korea: the joint-stock company (Chusikhoesa), the general partnership company (Hapmyunghoesa), the limited liability company (Yuhanhoesa), the private limited company (Yuhanchaek-Imhoesa) and the limited partnership company (Hapjahoesa).
The choice of your business relies heavily on your objectives, tax impact and trade rules in South Korea. Majority of the foreign entrepreneurs start with a liaison office since its registration formalities are simple, apart from getting it registered with the national bank and the taxation office. The Foreign Exchange Transactions Act and the Commercial Act regulate the liaison office.
A foreign entrepreneur can also set up a branch of a foreign company in South Korea. For this, the branch must be reported to a defined foreign exchange bank and get the court registration, as well as the business registration done.
To
form a commercial enterprise or limited liability company, the lowest capital requirement
is 50 million Korean Won (about 36,000 euros).
Furthermore, the company repute must be endorsed by a notary and a founder must
be hired for registration. Once this is done, the responsibility of managing
the company will lie with its Board of Directors.
Foreign direct investment (FDI) incentives work to recompense international investors in South Korea for their additions to the economy and at the same time lowering their startup costs. Presently, the government provides tax rebates to international businesses that can significantly contribute to the Korean economy.
Simultaneously, the government provides these businesses with manufacturing land (or helps them locate and acquire a site) and grants cash incentives and other forms of capital assistance.
Government-assigned free trade zones invite more expansion, inclusive of business-friendly laws related to manufacturing, distribution and trade; inexpensive rents on land and buildings; tax relief; and single-window administrative services. Also, undemanding customs reporting processes are implemented on a variety of value-added logistics goings-on.
The government is also making free economic zones to boost businesses in free trade zones, for the purpose of enhancing the infrastructure at key international hubs and set up likeable conditions of life for foreigners. Currently, Korea has eight free economic zones.
Ideally positioned between China and Japan, South Korea is within easy reach of more than 60 cities, populated in millions (average flying time: three hours). The signing of the 2007 United States-Korea Free Trade Agreement has worked as a thrust for South Korean businesses by making them easily access the world’s largest consumer market.
The Republic of South Korea has an elaborate Free Trade Agreement (FTA) with the Association of Southeast Asian Nations (ASEAN) and also a provisional agreement with India. An FTA has also been signed with the European Union and going forward, with Canada, Mexico, Australia, New Zealand and a number of other nations.
South Korea’s digital-savvy clients have made chunks of contribution to the development of the country’s home market since the last 10 years. Korean mobile phones companies and home appliances — famous for their high-standard products all across the globe— have flourished, thanks to their sharp local consumers.
This is the reason for tech firms such as Microsoft, Motorola and eBay and also consumer goods firms such as Procter & Gamble and L’Oréal, South Korea is a testing ground for their new commodities.
South Korea has superbly planned and designed seaports, airports, roads and rails. As of 2008, Incheon International Airport (the country’s biggest airport, bordering Seoul) caters to 63 airlines and 30 million passengers traveling between 49 nations.
The best of the rest, six years after its 2001 start of operations, it had become the world’s number two airport, concerning cargo flow.
South Korea continues to be comparatively a favorite business destination for foreign companies and its potential is gradually reaching new heights. Despite being a seemingly closed economy, and because of language and cultural barriers, it is a fruitful business destination.
Also, the special features of this economy present interesting knowledge opportunities and a doorway to the bigger Northeast Asian markets for the adventurous entrant. To be successful, one must focus on the efficiency and quality, and also hiring, marketing and brand building (usually through off-the-record networks.
For those who ready to take this plunge, get to live in and work with one of the most self-motivated economies in the world, providing well-qualified, hardworking and determined workforce and joining forces with a few of the major and fastest-growing international companies.
Contact us to help you set up your business in Korea.