Share information on reshoring support system and know-how on foreign divestment
The Ministry of Trade, Industry and Energy (MOTIE) and KOTRA announced that they will hold “A Session on Foreign Divestment and Support Measures for Reshoring Enterprises” at KOTRA headquarters in Seocho-gu, Seoul on April 9.
This session is a follow-up measure for “Comprehensive Support Measures for Reshoring Enterprises,” announced by the government in November last year. The session has been set up to explain “measures to support enterprises returning to Korea (Reshoring Support)” to companies interested in liquidation or transfer of overseas production facilities. In particular, the session will address some topics currently in discussion for revision, such as the industries covered, easing of requirements for overseas business site scaledown, subsidies for site and facilities, and enhanced incentives including tax cut.
As this year’s session is to be co-hosted with PwC, the know-how on foreign divestment will be also shared with domestic companies. The expert knowledge required for successful sales of foreign assets, such as looking for buyers, sales procedures, asset assessment and tax issues will be explained in detail.
According to a survey conducted by KOTRA, the difficulties overseas Korean companies expect in returning to Korea are as follows: lack of information regarding the sales procedures (55.4%) and sales of facilities (43.4%) abroad; and high labor cost(68.7%) and the costs of site and land (30.6%) in Korea
“2018 Survey on Overseas Korean Companies” published by KOTRA in February 2019 revealed that a majority companies seek to transfer business to Korea or third countries in response to changes in business environment, including uncertainties stemming from recent changes in trade environment concerning the US and China and a hike in local labor cost.
KOTRA has been running a Reshoring Firm Support Center in major regions abroad since 2013 (currently five such centers including Beijing Center), and attracted 52 companies to return to Korea as of February this year with provision of support in the selection procedure. In February this year, KOTRA established a Reshoring Support Team in line with the revision to reshoring company-related system, and stepped up activities for promoting reshoring system and on-site consulting at head offices. In doing so, KOTRA intends to attract 100 reshoring enterprises and create 2,000 jobs by 2022.
Shawn Chang, the Head of Invest KOREA said, “This event will provide a great opportunity to learn the government’s policy to support reshoring enterprises and know-hows on foreign divestment, essential for overseas Korean companies when considering transfer to Korea and liquidating their foreign corporation,” adding that “KOTRA will actively support a u-turn of overseas Korean companies in close cooperation with the government and relevant agencies.”
This session will be provided free of charge, and those who want to attend shall make applications through KOTRA Reshoring Support Team (02-3460-3244, email@example.com) by April 8 (Mon).
Source: Invest KOREA (April 3, 2019)