FAQ) Types of Korean Businesses (Company, Branch, Liaison) | Pearson & Partners Korea

What are the types of entity structures available to register company in South Korea?

Company

• Joint Stock Company(????)
• Limited Liability Company (????)

Branch Office

A branch office is an extension of the parent company that is planning to establish a presence in South Korea. As such, the parent company is fully accountable for all liabilities incurred by the South Korea branch office. In addition, a branch office setup does not impose any limit on the amount of investment or ownership. Your South Korea branch office will not have full entitlement to government support or tax incentives as compared to those business entities mentioned above.

Representative Office(Liaison Office)

A representative office is often meant for foreign investors who do not intend to carry out business in South Korea. As such, they are only allowed to conduct limited and non-commercial activities such as market research and marketing activities for their parent company. However, a representative office is still required to register and report to the jurisdictional tax office. Nonetheless, a representative office is a popular choice for foreign investors who are planning to promote their presence, as well as seeking to explore the potential market before setting up business in South Korea.

COMPARISON OF DIFFERENT BUSINESS COMPANY STRUCTURE IN SOUTH KOREA

• Do overseas corporate shareholders need to provide documents such as Board Resolutions from their respective corporations? Corporate shareholders must provide an apostilled copy of the board resolution, which includes their consent to register a company in South Korea. Additionally, the corporate shareholder should submit the following notarized and apostilled documents:

1. Certificate of Business Registration

2. Passport copy of the corporate shareholder's representative

3. List of shareholders

• Can I use a corporate name in Chinese or another language? Only Korean or Korean combined with English letters is allowed for Korea company registration.
• Is it possible to establish a corporation with only one foreigner? Do I need to hire local employees? Yes, it is definitely possible. There is no minimum requirement on hiring local directors for Korea company.
• Do I need two individuals to establish a limited liability company? Does it have to include a Korean? A limited company is a legal entity in which one or more shareholders assume liability limited to the extent of their contributions. Therefore, it is possible to establish a limited company with one director. Furthermore, it is possible to establish a limited company in Korea without a Korean national, allowing foreign individuals to do so independently.
• If there is no address listed on the driver's license, what should be done? If your driver license does not contain the residential address, you can provide other form of proof of residential address such as utility bill, phone bill and bank statements where we can verify the person’s name and full address. If it is not in English, the document needs to be translated into English.

If you have any additional questions or need further information, please feel free to contact us at any time.