How to Establish an LLC in Korea for Foreign Investors: Required Documents

Establishing a Limited Liability Company (LLC) in Korea is a common choice for foreign investors due to its less stringent disclosure obligations and restricted share trading. Below is a concise guide outlining the necessary documents and the responsible parties for each step in the process when foreign investors are injecting capital.

Initial Requirements

• Provide Office Address: The company must provide a physical office address in Korea.

Documents to be Prepared by the Shareholder (100% Owner of newCo)

• Power of Attorney (POA): Two copies are needed, including notarized English versions for the parent company and foreign investment purposes.
• Corporate Registry: The shareholder must provide a copy of the corporate registry.
• Shareholders’ List: This document verifies the ultimate ownership of the new corporation (newCo).

Documents to be Prepared by the Representative of newCo

• Copy of Representative’s Passport: A copy of the passport of the newCo’s representative.
• Acceptance Letter: An acceptance letter (in English) from the director.
• Certificate of Representative’s Home Address: Proof of the home address of the representative.

Reporting and Registration

• Report a Foreign Investment to Korean Foreign Exchange Bank: The company must report the foreign investment to the bank, and STAR Tax & Legal will assist with this process.
• Capital Injection: The company must ensure the capital injection is completed.
• Registration of Incorporation at Korean Court: STAR Tax & Legal will handle the registration of the corporation and the application for the corporate seal certificate.

Timeline and Actions by STAR Tax & Legal

• 3 Days: Court Registry – STAR Tax & Legal will apply for the court registration.
• 2 Days: Application of Korean Tax ID – STAR Tax & Legal will apply for the business registration.
• 1 Day: Bank Account Opening – STAR Tax & Legal will assist in opening a bank account for the new corporation.

Why Choose an LLC in Korea?

Foreign investors often opt to establish an LLC in Korea because it offers several advantages:

• Limited Disclosure Obligations: LLCs have fewer disclosure requirements compared to other corporate structures.
• Restricted Share Trading: Share transfers within an LLC are not as freely conducted, providing more control over ownership changes.

By choosing an LLC, foreign investors can benefit from a more straightforward and controlled corporate structure in Korea. For further details or assistance, please contact STAR Tax & Legal, which specializes in establishing foreign-invested LLCs in Korea, at siyoon@star-tax.kr.