Post-Management of Foreign Investment

Registration of Changes in the Foreign-Invested Company

Foreign investors (or their agents) or a foreign-invested company shall register any changes in the foreign-invested company at the entrustment institution within 30 days from the occurrence of the change as follows.

Acquisition of shares through mergers etc.
(acquisition of stocks through mergers, free issue of new shares etc.);
Changes in held equity or investment ratio due to share transfer, or capital reduction of the foreign investor;
Changes in held equity or investment ratio of the foreign investor due to capital increase by a citizen of Korea;
Changes in trade name, title, nationality of the foreign investor or foreign-invested company;
Other changes in the registration such as foreign investment amount, investment ratio, foreign-invested company address etc.

Required Documents

Foreign-invested company registration application
(existing foreign-invested company registration to be returned);
Certified copy of corporate registration of the foreign-invested company (cancelled items included);
Copy of foreign exchange purchase certificate or foreign currency deposit certificate;
Shareholder registration (corporate seal, certified copy of the original) or documentary evidence of transfer of funds for shares;

Additional documents to be attached when necessary

Documentary evidence of investment object:
Copy of investment in kind completion confirmation (for investment in kind of capital goods);
Copy of inspection report by a inspector under the commercial law, or evaluation report by an evaluator (investment of shares or domestic real estate);
Other documentary evidence related to share acquisition and documents to prove changes;
Letter of attorney to be included for notification made by agents.

Notification of Transfer and Capital Reduction of Shares

Foreign investors (or their agents) transferring or reducing shares etc. shall notify the transfer or reduction of shares to the entrustment institution within 30 days from the conclusion of the contract, and within 30 days from the end date of the notified time to creditors. If the receiver of the transferred shares is a new foreign investor, the share acquisition notification procedure can be omitted by attaching a certificate of nationality of the receiver.

Required Documents

2 copies of the notification of transfer or reduction of shares or equity;
Transfer contract, certified copy of capital reduction change registration, and copies of other documentary evidence of transfers and reductions;
Letter of attorney to be included for notification made by agents.

Capital Goods Liquidation Notification

Foreign investors or foreign-invested companies shall make a prior notification to the entrustment institution when trying to transfer, lease, or use capital goods that were exempted from customs etc. at the time of import for other purposes than the notified purposes less than 5 years after the date of import report acceptance.

Required Documents

2 copies of capital goods disposition notification

A Foreign-Invested Company's Additional Business Operation or Acquisition of Another Domestic Company's Shares

Foreign-invested companies shall not operate an additional business above the approved limit in business categories where foreign investment is restricted. However, even in restricted categories, foreign investment is allowed if the foreign investment ratio is less than 10%.
Though foreign-invested companies cannot acquire more than the permitted level of shares of other domestic companies operating in restricted categories, there are exceptional cases as follows:

The company whose foreign investment ratio is less than 50%, or where the foreign investor is not the majority shareholder acquires shares of a domestic company;
A foreign-invested company operating financial or insurance business acquires other companies' shares as its whole or partial business activity according to other legal regulations;
The company acquires up to 10% of the total issued shares or total amount of capital investments of a domestic company

Cancellation of Foreign Investment Company Registration

Registration as a foreign-invested company shall be erased when all the shares or equity held by the foreign investor are transferred to a citizen or corporation of the Republic of Korea, or when the held shares or equity no longer exist due to capital reduction by the foreign-invested company. Registration erasure application may be submitted by the foreign-invested company or foreign investor to the entrustment institution. The foreign-invested company registration certificate shall be returned at the same time.
The Ministry of Knowledge Economy may erase the registration of the foreign investor or foreign-invested company in the following cases:

When the registered foreign-invested company ceases its operation or does not conduct business for over 2 years;
When the registered foreign investor or foreign-invested company with permission to acquire existing shares or equity of a company operating in the defense industry does not carry out orders for corrections by the Minister of Knowledge Economy, or other required measures;
When a cause of the dissolution of the registered foreign-invested company occurs;
When a foreign investor applies for registration erasure according to a Presidential decree;
When the foreign-invested company registration is transferred or lent to a third party;
When the foreign-invested company registration is made under the guise of payment for investment objects.

Required Documents

2 copies of the foreign invested company registration erasure application;
1 copy of documentary evidence of registration erasure
(certified copy of liquidation, closure certificate etc.);
The original copy of the foreign-invested company registration