How Do You Incorporate a Company in South Korea as a Foreign Business?

Most foreign SMEs choose a Chusik Hoesa because Korean banks, customers and investors are most familiar with it. A Yuhan Hoesa can suit a quiet group subsidiary. Branches are common for service providers serving existing global clients in Korea.

1. Foreign investment notification. Before remitting funds, file the notification with Invest KOREA (KOTRA) or a foreign exchange bank in Korea, stating the investor, amount and business.
2. Remit the capital from abroad to the investor's account opened for this purpose at a Korean foreign exchange bank, so the inflow is linked to the notification.
3. Obtain the share payment evidence — a certificate of share deposit or, for smaller capital, a bank balance certificate.
4. Draft the articles of incorporation and appoint directors, a representative director and, where required, a statutory auditor.
5. Register at the commercial registry of the competent district court. The company exists from registration.
6. Business registration at the district tax office, which issues the business registration number used for tax and invoicing.
7. Foreign-invested company registration with the authority that received the notification, generally within 30 days.
8. Employer registrations for the four major social insurances once staff are hired.

Indicatively, with a complete document set, the legal steps can take two to four weeks; banking and visas often add time.

Korean procedures traditionally rely on registered seals. Foreign individuals usually sign notarised documents instead, and provide passports and proof of nationality. Corporate investors provide a certificate of incorporation or good standing, a board resolution approving the investment and appointing the representative director, and a power of attorney for the local agent.

Korea has been a party to the Apostille Convention since 2007, so documents from other Convention countries are generally notarised and apostilled rather than consular-legalised. Korean translations are normally required, and names must appear consistently across the notification, articles and registry filings.

The National Tax Service administers corporate income tax, which is charged at progressive rates with a local income tax surcharge, and VAT at a standard 10%. Companies issue electronic tax invoices, withhold tax on salaries and many payments to non-residents, and file VAT returns periodically.

Foreign-invested company status can unlock incentives in qualifying high-technology sectors or designated zones, and it supports profit repatriation and foreign exchange procedures. The D-8 corporate investor visa for foreign executives also depends on qualifying FDI, with the KRW 100 million threshold as a baseline.

Banks are involved from the start because the notification and capital remittance usually run through a foreign exchange bank. After registration, opening the operating account requires the court registry extract, business registration certificate, articles, seal certificate, and identification for directors and beneficial owners. Korean banks usually expect the representative director or an authorised person to attend in person, and online banking for non-resident directors can be limited. Approval timing varies by bank.

Recurring obligations include the annual corporate tax return (generally within three months of year-end), VAT returns, payroll withholding and social insurance filings, registering changes to directors or capital at the court registry, and reporting changes in foreign investment. External audit applies once statutory size thresholds are met.

Korea suits technology, semiconductor, consumer and content businesses targeting Korean customers or partners. Japan is the natural comparison for a North Asian subsidiary, and many groups run their regional hub from Singapore or Hong Kong while operating a Korean company for local contracts.