While many foreign investors enter the Korean market by establishing a local company, foreign companies also expand their business to Korea by setting up a local branch. Although the domestic branch is not recognized as foreign investment, multinational companies and foreign entrepreneurs set up a branch to cultivate business opportunities in Korea as well as in Northeast Asia. The following is the procedure for setting up a branch in Korea.
*For liaison office, application for issuance of business registration number or identification number at the tax office would suffice.
Foreign companies need to notify the branch establishment to the head of a designated foreign exchange bank.
1. Notification form of the establishment of a foreign company’s domestic branch
2. Certificate of appointment of the head of the domestic branch
3. Documents certifying the foreign company (headquarters)’s name, location and major business operations (Notarization of the location of the headquarters is required if the documents are not original copies)
4. Where a permit, etc. is required for the establishment of a branch in accordance with other Acts and statutes, a copy of documents certifying that such permit, etc. has been obtained
5. Articles of association of the headquarters
6. Board meeting minutes containing the company’s plans to establish a branch or liaison office in Korea and details on the appointment of its representative in Korea
7. Specifications of the line of business that the company intends to operate in Korea and the scope of business
8. Power of attorney in cases where the establishment of a domestic branch is commissioned to a person other than the branch head (Notarization of the location of the headquarters is required)
For the following businesses, prospective branch office must notify the Minister of Strategy and Finance;
1. Financial business other than banking business, including fund loans, brokering and arranging overseas finance, cards, and installment financing
2. Businesses related to securities and insurances
3. Businesses that are not permitted under the Foreign Investment Promotion Act or other laws
While the liaison office does not need to undergo registration, a branch office intending to engage in sales activities need to register as a corporation.
The following documents are required for registration of branch establishment.
For more information on Korea Branch Office Establishment, contact us.