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Comparison of Sites

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Location support provided to facilitate and attract foreign investment consists of foreign investment zones as prescribed by the Foreign Investment Promotion Act, free trade zones as prescribed by the Act on Designation and Management of Free Trade Zones, and free economic zones as prescribed by the Special Act on Designation and Management. Among these, foreign investment zones are further classified into complex-type, individual-type, and service-type zones.
Specific details of location support available for foreign investment, such as requirements, eligible businesses, and incentives (rental fees, taxes, customs, cash) vary depending on the purpose of designation. It is recommended that investors carefully review and analyze investment locations, even for planned sites with seemingly simple procedures for factory establishment, authorization, and permission.

Designation of Foreign Investment Zones

Designation of Foreign Investment Zones : Major Location Support,Designated Areas,Number
Major Location Support Designated Areas Number
Foreign investment zones Complex-type Cheonan, Daebul, Sacheon, Ochang, Gumi, Jangan 1, Inju, Dangdong, Jisa, Jangan 2, Dalseong, Oseong, Cheonan 5, Woljeon, Munmak, Jincheon Sansu, Songsan 2, National Food (Iksan), Chungju, Gumi (parts), Pohang (parts), Iksan (parts), Changwon (parts), Mieum (parts), Songsan 2-1, Gwangyang Sepung 26
Individual-type Manufacturing (73), logistics (2), tourism (8), R&D (1) 84
Service-type Seoul (2), Daejeon (1) 3
Gyeonggi-do foreign investment zones Hyeongok, Poseung, Chupal, Eoyeon Hansan 4
Free trade zones Industrial site-type Ulsan, Donghae, Gunsan, Daebul, Yulchon, Masan 7
Seaport · Airport-type Port of Busan, Port of Pohang, Port of Pyeongtaek-Dangjin, Port of Incheon, Incheon International Airport 6
Free economic zones Busan · Jinhae, Gwangyang Bay Area, Incheon, Hwanghae, Daegu- Gyeongbuk, East Coast Area, Chungbuk 7
※ The designation of Saemangeum as a free economic zone was canceled on April 6, 2018, but the Saemangeum project is still underway in accordance with the Special Act on Saemangeum.
※ Songsan 2-2, a complex-type foreign investment zone, was added (March 20, 2019).

Comparison of Sites

Please refer to the information below Large view of images
Comparison of Sites : Free economic zones, Areas or zones for foreign direct investmen, Free trade zones
Free economic zones Areas or zones for foreign direct investmen Free trade zones
9 zones Complex-type (28 zones) Individual zones (78 zones) 7 industrial complexes, 6 ports/airports
Statutory grounds Special Act on the Designation and Operation of Free Economic Zones Foreign Investment Promotion Act Act on the Designation and Operation of Free Trade Zones
Procedure
  1. Requested by provincial governors or mayors
  2. review by the committee
  3. designated by provincial governors or mayors
  1. Requested by provincial governors or mayors
  2. review by the committee
  3. designated by provincial governors or mayors
  1. Requested by heads of central government agencies/requested by provincial governors or mayors
  2. review by the committee
  3. designated by the Industry Minister
Eligibility for tenancy
  • Local businesses
  • Foreign-invested companies
Foreign-invested businesses
  • Ratio of foreign investment 30%↑, KRW 100 million↑
  • New growth engine industrial technology business, advanced manufacturing businesses, R&D, and logistics industry
  • Minimum required investment amount for foreign-invested company and by industry (identical to requirements for tax rebate)
  • Manufacturing: USD 30 million↑
  • Logistics industry: USD 10 million↑
  • Tourism service: USD 20 million↑
  • R&D: USD 2 million↑& 10↑researchers hired
  • Domestic
  • Foreign-invested companies
    • Manufacturing: 50%↑ should be exported
    • Wholesale business:50%↑ should be imported and exported
    • Logistics industry and business support service
Tax rebate Eligibility for admittance Foreign-invested business or company Foreign-invested business or company Foreign-invested business or company
Requirements
  • Manufacturing: USD 30 (10) million↑
  • Logistics industry: USD 10 (5) million↑
  • Tourism service: USD 20 (10) million↑
  • R&D: USD 2 (1) million↑ & 10↑ researchers hired
  • Medical institutions: USD 5 million↑
  • Development service: USD 30 million↑
  • Manufacturing: USD 10 million↑
  • Logistics industry: USD 5 million↑
  • Manufacturing: USD 30 million↑
  • Physical distribution: USD 10 million↑
  • Tourism service: USD 20 million↑
  • R&D: USD 2 million↑& 10↑ researchers hired
  • Manufacturing: USD 10 million↑
  • Logistics industry: USD 5 million↑
Local or municipal tax Eligible businesses, reduction amount & period, reduction rate shall be pursuant to the standards prescribed by the Restriction of Local Taxation Act. The tax credit period may be extended up to 15 years as set forth in municipal ordinances (Acquisition Tax, Property Taxes, etc.)
Customs duties 100% exemption on imported capital goods for five years Individual consumption tax and VAT are also waived for seven years Imported capital goods: 100% exemption for five years Individual types: Individual consumption tax and VAT rebate Exempted
Support for location State-owned or publicly-owned land: Rent reduction (50-100% for up to 50 years) Rent reduction (1% of the land price, 75~100%)
  • Purchased inclusively by the central or municipal governments
  • State-owned land: Leased up to 50 years (1% of the land price, 50~100% reduction)