Industrial sites are divided into planned sites and individual sites. Planned sites refer to industrial locations developed under a plan by the central or municipal governments or private businesses. It includes national industrial complexes, general industrial complexes, urban high-tech complexes, and rural industrial complexes. Individual sites refer to areas where individual businesses build their factory by obtaining the necessary permits or licenses by purchasing a factory site in an area outside an industrial complex. The planned sites for promoting or attracting foreign direct investment include foreign investment zones, free economic zones and free trade zones. Designation requirements, and types of businesses will differ depending on the locations designated for foreign direct investment and various investment incentives will be provided.

The foreign investment zone is designated and notified to facilitate foreign investment and attract large-scale foreign investment. It is categorized into complex-type, individual-type and service-type, which vary in terms of the designation requirements, occupancy requirements and limitations and investment incentives. A complex-type foreign-investment zone is designated to provide (lease) factory sites at a low cost to promote investment of foreign companies that possess advanced technologies including high-technology. An individual-type foreign investment zone is a tailored location for investors they can choose and designate the investment zone. A service-type foreign investment zone refers to areas designated for lease or transfer to foreign-invested companies operating a service business such as an R&D business, finance business, knowledge-based business, culture and tourism business, and industrial support service business.

Free economic zones are special economic zones designed to actively induce foreign direct investment by guaranteeing free business activities and investment incentives to the maximum possible extent, primarily by alleviating various regulations while improving the business and living conditions of foreign-invested businesses. Also, a wide range of free business activities are guaranteed by providing various tax incentives, deregulation, convenient living conditions and simplified administrative services.

Industrial complexes, airports, seaports, distribution complexes, freight terminals, etc. are designated as free trade zones to attract manufacturing and logistics businesses and to create a synergy effect by clustering such businesses. Free trade zones create favorable business conditions for foreign-invested companies engaged in export-oriented manufacturing business, logistics business and wholesale for import and export. In a free trade zone, companies can benefit from tax deduction and extended lease period depending on the line of business and investment size. Also, customs duties are deferred for goods introduced into a free trade zone, and a zero rate of value added tax is applied. Free trade zones have the advantage of not having to undergo complicated procedures for refunds, etc. when exporting products manufactured with imported raw materials.

Industrial sites for foreign investors

* Although the designation of Free Economic Zone in Saemangeum area was cancelled as of April 6, 2018, Saemangeum project is still underway due to the Act on Saemangeum Project.