Today's Invest Guide : Installation of branch office and liaison office of foreign company
The installation of the domestic branch office of a foreign corporation
means it conducts general business activities in Korea.
Establishing a branch office requires the appointment of
a representative and the same registration procedure
as a branch of a business in an equivalent category
or the most similar type of the company already established in Korea.
Unlike foreign-invested companies, there is no concept of capital
for a domestic branch. Funds for business operation may be
brought from the head office of a foreign company. In this case
these funds must be foreign currency directly transferred to
a bank designated by the head office.
The branch office of a foreign corporation conducts profit-making
business activities in Korea. Therefore, the same corporate income
tax rate as typical domestic corporations is applied to the incomes
generated from businesses operating in Korea. The transfer of net
profit to a foreign country upon settlement of accounts is possible.
The liaison office conducts non-sales related activities for the head
office such as business liaison, market research, and R&D, and does
not conduct revenue-generating sales activities in Korea.
Steps to establish a domestic branch of a foreign corporation
1 Application of a corporation at a foreign currency bank
2 Branch Establishment Declaration & Acceptance Permission
Court registration office (capital registration / corporation establishment
- Tax office (business registration)
3 Court Registration and Business Registration (branch)
& Identification Number Grant (liaison office)