Business entities in South Korea in 2023

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South Korea business setup is an option for multinationals wanting to access dynamic North Asian markets, but who are unwilling to face the bureaucratic hurdles of setting up business in China or Japan. A limited liability company (LLC) is the most common South Korean entity, though joint stock companies, branch offices or local liaison offices are also useful entities to support activities in the country.

  • South Korea business set up for foreign investors

    • There are three main types of entity for foreign capital investment: i) local corporation ii) local branch and iii) local liaison office;
    • All local companies fall under the foreign direct investment (FDI) system, and require a minimum investment of 100 million KRW (approximately US$82,000);
    • Branch and liaison offices are categorised under the domestic branch of a foreign company, and can be registered with no minimum investment.
  • Limited Liability Company (Yuhan Hoesa)

    • This is the most commonly entity used for starting a business in South Korea. The company is an entity separate from owners who enjoy limited liability;
    • A South Korean LLC must appoint at least one director and one shareholder;
    • A South Korean LLC requires a minimum used share capital of US$1 while setting up a company in South Korea;
    • A South Korean LLC can be incorporated in two weeks.
  • General Partnership (Hapmyong Hoesa)

    • All partners have unlimited liability;
    • Each partner is jointly liable for debts incurred by the entity;
    • Transfer of ownership in this kind of company is limited, as unanimous consent of all members is required.
  • Limited Liability Partnership (Hapja Hoesa)

    • Members can choose to either have limited or unlimited liability;
    • While the liability of the limited members will be limited to the amount of their capital investment, they cannot make any business decisions on behalf of the partnership;
    • All day-to-day business responsibilities are handled by partners with unlimited liability.
  • Joint Stock Company (Chusik Hoesa)

    • Stockholders have liabilities limited to the extent of their capital investment in the company;
    • Stocks are freely transferrable, though this is subject to approval by the board of directors;
    • A joint stock company is required to hold shareholder meetings at least annually to discuss financial statements and dividends.
  • Branch Office

    • Despite having its own management team, bank account and capital resources, a branch office operates within the confines defined by the parent company;
    • This South Korea business setup entity is allowed to invoice local customers, sign local sales contracts, and receive income from customers.
  • Liaison Office

    • While a South Korean liaison office is 100% foreign-owned and controlled, it is not permitted to make direct sales within the country;
    • A liaison office can only engage in activities such as i) promoting the business of the parent company and ii) market research.
DetailLLCBranch OfficeRep Office
Total company set up costsUS$13,093US$13,693US$12,333
Subsequent annual costs (excl accounting and tax fee)US$4,350US$4,500US$4,500
How long to set the company up?2 weeks2 weeks2 weeks
How long to open company bank account?2 weeks2 weeks2 weeks
Issued share capital requiredUS$1NoNo
Allowed to sign sales contracts with South Korean ClientsYesYesNo
Allowed to invoice South Korean ClientsYesYesNo
Corporate tax payable in South Korea22%22%22%
Corporate bank accountSCB or HSBCSCB or HSBCSCB or HSBC
Can rent office premises in South KoreaYesYesYes
Allowed to import raw materials?YesYesNo
Allowed to export goods?YesYesNo
Can the entity hire expatriate staff?YesYesYes
Do you need to visit South Korea?NoNoNo
Resident director required?NoNoNo
Resident shareholder required?NoNoNo
Minimum number of directors111
Minimum number of shareholders111
South Korean resident company secretaryNoNANA
Tax registration certificate requiredYesYesYes
Individual shareholders allowedYesYesYes
Corporate shareholders allowedYesYesYes
Public register of shareholders and directorsYesYesYes
How long to get work permit approved6 weeks6 weeks6 weeks
Statutory audit requiredYesYesYes
Annual tax return to be submittedYesYesYes
Access to South Korean double tax treatiesYesYesYes
Draft invoiceView invoice PDFView invoice PDFView invoice PDF

Contact us

For additional information on our business setup services in South Korea, please contact our in-house country expert, Ms. Chrissi Zamora, directly:
client relationship officer - Chrissi