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FOREIGN INVESTMENT PROMOTION ACT
| FOREIGN INVESTMENT PROMOTION ACT | No.21065 | 20251001 |
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| FOREIGN INVESTMENT PROMOTION ACT | No.7754 | 20051223 |
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| FOREIGN INVESTMENT PROMOTION ACT | No.6095 | 20010101 |
| FOREIGN INVESTMENT PROMOTION ACT | No.5982 | 19990524 |
| FOREIGN INVESTMENT PROMOTION ACT | No.5914 | 19990809 |
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| FOREIGN INVESTMENT PROMOTION ACT | No.5654 | 19990322 |
| FOREIGN INVESTMENT PROMOTION ACT | No.5559 | 19981117 |
CHAPTER I GENERAL PROVISIONS
| Article 1 (Purpose) |
The purpose of this Act is to promote foreign investment in Korea by providing necessary support and benefit and to contribute to the sound development of the nation's economy.
[This Article Wholly Amended on Jan. 30, 2009]
| Article 2 (Definitions) |
| (1) | The terms used in this Act are defined as follows: <Amended on Jan. 27, 2016; Feb. 4, 2020; Dec. 22, 2020> |
| 1. | The term "foreigner" means an individual with a foreign nationality, a corporation established in accordance with a foreign law (hereinafter referred to as "foreign corporation"), or an international economic cooperative organization prescribed by Presidential Decree; |
| 2. | The term "national of the Republic of Korea" means an individual who has the nationality of the Republic of Korea; |
| 3. | The term "Korean corporation or enterprise" means a corporation established in accordance with the Acts of the Republic of Korea or a domestic enterprise registered as a business entity; |
| 4. | The term "foreign investment" means any of the following: |
| (a) | Where a foreigner holds stocks or shares (hereinafter referred to as "stocks, etc.") of a Korean corporation or enterprise (including a Korean corporation in the process of establishment; hereafter in this Article the same shall apply), as prescribed by Presidential Decree, by any of the following methods in order to establish a continuous economic relationship with the Korean corporation or enterprise, such as participating in the management of the Korean corporation or enterprise, in accordance with this Act: |
| (i) | Acquisition of stocks, etc. newly issued by the Korean corporation or enterprise; |
| (ii) | Acquisition of previously issued stocks or shares (hereinafter referred to as “existing stocks, etc.”) of the Korean corporation or enterprise; |
| (b) | A loan with maturity of not less than five years (based on the loan maturity prescribed in the first loan contract), which is provided to the relevant foreign-invested company by any of the following entities: |
| (i) | The overseas parent company of the foreign-invested company; |
| (ii) | A company that has a capital investment relationship prescribed by Presidential Decree with the company prescribed in (i); |
| (iii) | A foreign investor; |
| (iv) | A company that has a capital investment relationship prescribed by Presidential Decree with the investor prescribed in (iii); |
| (c) | Where a foreigner contributes to a non-profit corporation pursuant to this Act in order to establish a continuous cooperative relationship with the corporation which satisfies the standards prescribed by Presidential Decree in terms of research personnel, facility, etc. and which is a Korean corporation or enterprise in the field of science and technology; |
| (d) | Where a foreign-invested company uses its unappropriated earned surplus for the purposes prescribed by Presidential Decree, such as the creation or extension of its factory facilities (in this case, the foreign-invested company shall be deemed a foreigner under this Act, and the amount of foreign investment shall be the amount calculated by multiplying the amount used and the foreign investment ratio under Article 5 (3)); |
| (e) | Other contributions to a non-profit corporation by a foreigner, which the Foreign Investment Committee established under Article 27 (hereinafter referred to as the "Foreign Investment Committee") recognizes as a foreign investment in accordance with the standards prescribed by Presidential Decree regarding the business contents, etc. of the non-profit corporation; |
| 5. | The term "foreign investor" means a foreigner who holds stocks, etc. or has contributed as prescribed by this Act; |
| 6. | The term "foreign-invested company or foreigner-contributed non-profit corporation" means a company in which a foreign investor has invested, or a non-profit corporation to which a foreign investor has contributed; |
| 7. | The term "operator of establishments built to improve a foreign-investment environment" means any person who operates establishments prescribed by Presidential Decree, including schools and medical institutions for foreigners, in order to improve a foreign investment environment; |
| 8. | The term "object of investment" means any object in which a foreign investor invests in order to hold stocks, etc. under this Act, and which is any of the following: |
| (a) | A means of international payment as defined under the Foreign Exchange Transactions Act or a means of domestic payment incurred by the exchange of such a means of international payment; |
| (b) | Capital goods; |
| (c) | Proceeds from the stocks, etc. acquired under this Act; |
| (d) | Industrial property rights, intellectual property rights prescribed by Presidential Decree, other technologies corresponding thereto, and rights pertaining to the use of such rights or technologies; |
| (e) | Where a foreigner closes his or her own branch company or office in Korea and converts the branch company or office into another domestic corporation, or where a domestic corporation, the stocks of which are held by a foreigner, is dissolved, the residual property to distributed to the foreigner upon liquidation of such branch company, office, or corporation; |
| (f) | The amount of redemption of loans referred to in subparagraph 4 (b) or of other loans from foreign countries; |
| (g) | Stocks prescribed by Presidential Decree; |
| (h) | Real estate located in Korea; |
| (i) | Other means of domestic payment prescribed by Presidential Decree; |
| 9. | The term "capital goods" means machinery, apparatus, facilities, equipment, parts, and accessories as industrial facilities (including vessels, motor vehicles, aircraft, etc.), livestock, breeds or seeds, trees, fish and shellfish which are necessary for the development of agriculture, forestry, and fisheries, raw materials and reserve stocks deemed necessary by the competent Minister (referring to the head of the central administrative agency in control of the project concerned; hereinafter the same shall apply) for the initial test (including pilot projects) of the facilities concerned, and the fees for transportation and insurance required for the introduction thereof and other know-how or service necessary therefor; |
| 9-2. | "Repatriating enterprises in a non-Seoul Metropolitan area" means enterprises that establish or expand their places of business in an area other than the Seoul Metropolitan area defined in subparagraph 1 of Article 2 of the Seoul Metropolitan Area Readjustment Planning Act, among repatriating enterprises eligible for assistance selected pursuant to Article 7 of the Act on Assistance to Korean Off-Shore Enterprises in Repatriation; |
| 10. | Deleted. <Jan. 27, 2016> |
| (2) | For the purposes of this Act, the provisions of this Act concerning foreigners shall apply to an individual prescribed by Presidential Decree among nationals of the Republic of Korea who holds permanent residency in a foreign country. <Amended on Jan. 27, 2016> |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 3 (Protection of Foreign Investment) |
| (1) | Remittance of proceeds accruing from the stocks, etc. acquired by a foreign investor, proceeds from the sale of stocks, etc., and the principal, interests, and service charges paid under the loan contract referred to in Article 2 (1) 4 (b) to a foreign country, shall be guaranteed in accordance with the details of the report or permission of the foreign investment at the time of such remittance. <Amended on Jan. 27, 2016> |
| (2) | Except as otherwise provided in other statutes, foreign investors and foreign-invested companies shall be treated in the same manner as nationals of the Republic of Korea or Korean corporations or enterprises are treated in respect of their business operations. <Amended on Feb. 4, 2020> |
| (3) | Except as otherwise provided in other statutes, the provisions of tax statutes concerning tax exemptions and reductions applied to nationals of the Republic of Korea or Korean corporations or enterprises shall also apply to foreign investors, foreign-invested companies, and the lenders of loans under Article 2 (1) 4 (b). <Amended on Jan. 27, 2016; Aug. 20, 2019; Feb. 4, 2020> |
| (4) | Matters necessary concerning procedures for remittance foreign countries under paragraph (1) shall be prescribed by Presidential Decree. <Newly Inserted on Jan. 27, 2016> |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 4 (Liberalization of Foreign Investment) |
| (1) | Except as otherwise provided in the statutes of the Republic of Korea, a foreigner may engage in various activities of foreign investment in the Republic of Korea without restraint. |
| (2) | No foreigner shall be restricted from making any foreign investment prescribed in this Act, except in the following circumstances: |
| 1. | Where he or she threatens national security and public order; |
| 2. | Where he or she has harmful effects on public health and sanitation or environmental preservation or is against Korean morals and customs; |
| 3. | Where he or she violates any statutes of the Republic of Korea. |
| (3) | The categories of businesses in which foreign investment is restricted in accordance with any of the subparagraphs of paragraph (2) and the details of restrictions shall be prescribed by Presidential Decree. |
| (4) | Where the head of a relevant administrative agency restricts foreign investment, such as treating foreigners or foreign-invested companies unfavorably compared to nationals of the Republic of Korea or Korean corporations or enterprises or charging additional liabilities to foreigners or foreign-invested companies, in statutes and regulations other than this Act, public notices, etc., the Minister of Trade, Industry and Energy shall combine and publicly announce the details thereof each year, as prescribed by Presidential Decree. Where the head of a relevant administrative agency intends to amend or add any restriction, he or she shall pre-consult with the Minister of Trade, Industry and Energy. <Amended on Mar. 23, 2013; Feb. 4, 2020> |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 4-2 (Formulation of Plans to Stimulate Foreign Investment) |
| (1) | In order to stimulate foreign investment, the Minister of Trade, Industry and Energy shall formulate a plan to stimulate foreign investment (hereinafter referred to as "stimulus plan") each year by integrating and coordinating plans to stimulate foreign investment submitted by the heads of relevant central administrative agencies, the Special Metropolitan City Mayor, Metropolitan City Mayors, Special Self-Governing City Mayor, |
| (2) | Each stimulus plan shall include the following matters: |
| 1. | Basic direction-setting for stimulating foreign investment; |
| 2. | Analysis of circumstances of foreign investment, such as Korean companies’ trends in entering into overseas markets and the industrial structure in the Republic of Korea; |
| 3. | A plan for inviting foreign investment; |
| 4. | A plan for assisting agencies engaging in activities of inviting foreign investment. |
| (3) | The heads of related central administrative agencies and the Mayors/ |
| (4) | The Minister of Trade, Industry and Energy, the heads of related central administrative agencies and the Mayors/ |
| (5) | The Minister of Trade, Industry and Energy may request the Mayors/ |
| (6) | Upon receipt of a request made under paragraph (5), the Mayors/ |
[This Article Wholly Amended on Jan. 30, 2009]
[Title Amended on Apr. 5, 2010]
| Article 4-3 (Actual Survey of Employment by Foreign-Invested Companies) |
| (1) | The Minister of Trade, Industry and Energy shall conduct an actual survey of employment by foreign-invested companies every three years in order to more efficiently formulate and implement stimulus plans, and support foreign investment. |
| (2) | The actual survey under paragraph (1) shall include the following: |
| 1. | Matters concerning the employment status and characteristics of foreign-invested companies by region, category of business, and occupation; |
| 2. | Matters concerning change in demand for human resources by foreign-invested companies; |
| 3. | Matters concerning working conditions, including wages, provided by foreign-invested companies; |
| 4. | Other matters the Minister of Trade, Industry and Energy deems necessary in relation to employment status of foreign-invested companies. |
| (3) | The Minister of Trade, Industry and Energy may, where necessary for the actual survey under paragraph (1), request submission of materials or opinion to the head of the relevant central administrative agency, a Mayor/ |
[This Article Newly Inserted on Dec. 31, 2018]
CHAPTER II PROCEDURES FOR FOREIGN INVESTMENT
| Article 5 (Reporting on Foreign Investment) |
| (1) | A foreigner (including specially related personnel prescribed by Presidential Decree in cases falling under Article 2 (1) 4 (a) (ii); hereafter in this Article the same shall apply) who intends to make a foreign investment by either of the methods provided for in the items of Article 2 (1) 4 shall, in advance, report thereon to the Minister of Trade, Industry and Energy, as prescribed by Ordinance of the Ministry of Trade, Industry and Energy. |
| (2) | Notwithstanding paragraph (1), a foreigner who intends to make a foreign investment by any of the following methods may report thereon within 60 days from the acquisition of stocks, etc.: |
| 1. | Where the foreigner acquires existing stocks, etc. issued by a listed stock corporation under the Financial Investment Services and Capital Markets Act (excluding public purpose corporations referred to in Article 152 (3) of the same Act and corporations that are restricted from acquiring stocks under separate Acts); |
| 2. | Where the foreign investor acquires stocks, etc. issued upon capitalizing reserves of the relevant foreign-invested company, revaluation reserves thereof, or other reserves prescribed by other statutes or regulations; |
| 3. | Where the foreign investor acquires stocks, etc. of a surviving corporation or a newly incorporated corporation after a merger, all-inclusive stock swap or transfer, or spinoff by means of stocks he or she is holding at the time of the relevant foreign-invested company's merger, all-inclusive stock swap or transfer with another company, or spinoff; |
| 4. | Where the foreigner acquires stocks, etc. of a foreign-invested company registered under Article 21 by means of purchase, inheritance, testamentary gift, or gift from a foreign investor; |
| 5. | Where the foreign investor acquires stocks, etc. by investing the proceeds from the stocks, etc. acquired under the statutes of the Republic of Korea; |
| 6. | Where the foreigner acquires stocks, etc. using convertible bonds, exchangeable bonds, stock depositary receipts, and such similar ones as bonds or receipts that may be converted into, taken over as, or exchanged for stocks, etc. |
| (3) | Of the details reported under paragraph (1) or (2), where any of the matters prescribed by Ordinance of the Ministry of Trade, Industry and Energy, such as the foreign investment ratio (referring to the ratio of the stocks, etc. owned by a foreign investor to the total stocks, etc. of a foreign-invested company; hereinafter the same shall apply), is modified, a foreigner may reflect such modified matter when reporting to Minister of Trade, Industry and Energy. |
| (4) | Upon receipt of a report filed under paragraphs (1) through (3), the Minister of Trade, Industry and Energy shall issue a certificate of completion of report to the relevant person without delay. |
[This Article Wholly Amended on Jan. 27, 2016]
| Article 6 (Permission of Foreign Investment) |
| (1) | A foreigner (including specially related persons prescribed by Presidential Decree) who intends to make a foreign investment in a defense industry company prescribed by Presidential Decree in a method provided in Article 2 (1) 4 (a) shall pre-obtain permission from the Minister of Trade, Industry and Energy, as prescribed by Ordinance of the Ministry of Trade, Industry and Energy, notwithstanding Article 5 (1) and (2). The same shall also apply where the foreigner intends to amend any permitted details prescribed by Ordinance of the Ministry of Trade, Industry and Energy, such as the foreign investment ratio. <Amended on Feb. 4, 2020> |
| (2) | Upon receipt of an application for permission filed under paragraph (1), the Minister of Trade, Industry and Energy shall determine whether to grant permission, and notify the relevant applicant of his or her determination within a period prescribed by Presidential Decree. |
| (3) | The Minister of Trade, Industry and Energy shall consult with the competent Minister before determining whether to grant permission under paragraph (2), as prescribed by Presidential Decree. |
| (4) | The Minister of Trade, Industry and Energy may impose conditions on permission granted under paragraph (2) if deemed necessary to do so. |
| (5) | No one who has acquired stocks, etc. without obtaining permission under paragraph (1) or in violation of conditions imposed under paragraph (4) shall exercise his or her voting rights in such stocks, etc. <Amended on Feb. 4, 2020> |
| (6) | The Minister of Trade, Industry and Energy may order a person who has acquired stocks, etc. without obtaining permission under paragraph (1) or in violation of conditions imposed under paragraph (4) to transfer such stocks, etc. to a third party, as prescribed by Presidential Decree. <Amended on Feb. 4, 2020> |
| (7) | Except as provided in paragraphs (1) through (6), matters necessary for permission of foreign investment shall be prescribed by Presidential Decree. |
[This Article Wholly Amended on Jan. 27, 2016]
| Article 7 Deleted. <Jan. 27, 2016> |
| Article 8 Deleted. <Jan. 27, 2016> |
| Article 8-2 Deleted. <Jan. 27, 2016> |
CHAPTER III MEASURES FOR SUPPORTING FOREIGN INVESTMENT
| Article 9 (Tax Reduction and Exemption for Foreign Investment) |
Taxes may be reduced or exempted for foreign investments, as prescribed by the Restriction of Special Taxation Act and the Restriction of Special Local Taxation Act. <Amended on Feb. 4, 2020>
[This Article Wholly Amended on Jan. 30, 2009]
| Article 10 Deleted. <May 24, 1999> |
| Article 11 Deleted. <May 24, 1999> |
| Article 12 Deleted. <May 24, 1999> |
| Article 13 (Lease of State or Public Property) |
| (1) | The Minister of Economy and Finance, the head of a central government agency that manages state property, the head of a local government, the head of a public institution, or the head of a local public enterprise under the Local Public Enterprises Act (excluding local government-directly operated enterprises; hereafter in this Article referred to as "local public enterprise") may, by a negotiated contract, allow a foreign-invested company or the operator of establishments built to improve a foreign-investment environment (hereafter in this Article and Articles 13-2 through 13-4 and 14 referred to as "foreign-invested company, etc.") to use or profit from land, factories, or other property (hereinafter referred to as "land, etc.") owned by the State, local government, public institution, or local public enterprise (hereinafter referred to as the “State, etc.”), or may lend such land, etc. to the foreign-invested company, etc. (hereinafter referred to as "lease"), notwithstanding the relevant provisions of any of the following statutes: |
| 1. | The State Property Act; |
| 4. | The Urban Development Act; |
| 7. | The Act on the Development and Management of Marinas. |
| (2) | Foreign-invested companies that are allowed to lease land, etc. pursuant to paragraph (1) shall be limited to companies meeting the minimum foreign investment ratio prescribed by Presidential Decree, and shall, after such lease, maintain the minimum foreign investment ratio for a period prescribed by Presidential Decree from the date of the lease (excluding where such companies temporarily fail to maintain the minimum foreign investment ratio for a period prescribed by Ordinance of the Ministry of Trade, Industry and Energy; hereinafter the same shall apply): |
| 1. | Where the foreign-invested company files a report on foreign investment with details for creating new employment exceeding the number of regular workers prescribed by Presidential Decree within three years; |
| 2. | Where the foreign-invested company files a report on foreign investment with details for making at least an investment amount prescribed by Presidential Decree within five years; |
| 3. | Where the foreign-invested company is granted a tax reduction or exemption under Article 121-2 (1) 1 of the Restriction of Special Taxation Act; |
| 4. | Where deemed necessary by the Minister of Trade, Industry and Energy after deliberation by the Foreign Investment Committee, from among businesses which have made substantial contributions to the expansion of social overhead capital, industrial restructuring, financial independence of the competent local government, etc. |
| (3) | Where land, etc. owned by the State, etc. are leased under paragraph (1), the lease term under the Acts referred to in subparagraphs 1 through 5 of the same paragraph may be set within a maximum of 50 years, notwithstanding the following provisions. In such cases, the lease term may be renewed, and the period of renewal shall not exceed the period specified in the former part at each time of renewal: <Amended on Apr. 5, 2010; Dec. 11, 2012; Feb. 4, 2020> |
| (4) | Where land owned by the State or a local government is leased under paragraph (1), a factory or other permanent facilities may be built on such land, notwithstanding Article 18 (1) of the State Property Act and Article 13 of the Public Property and Commodity Management Act. In such cases, the condition that the relevant facility be donated to the State or the local government, or returned after being restored to its original state, at the end of the lease term shall be attached, in consideration of the type, etc. of the facility. <Amended on Jan. 30, 2009; Dec. 11, 2012; Feb. 4, 2020> |
| (5) | Where land, etc. owned by the State, etc. are leased under paragraph (1), rents under the Acts referred to in subparagraphs 1 through 5 of the same paragraph shall be set as prescribed by Presidential Decree, notwithstanding the following provisions, and may be denominated in foreign currency: <Amended on Apr. 5, 2010; Dec. 11, 2012; Feb. 4, 2020> |
| (6) | Deleted. <Feb. 4, 2020> |
| (7) | Deleted. <Feb. 4, 2020> |
| (8) | Deleted. <Feb. 4, 2020> |
| (9) | Deleted. <Feb. 4, 2020> |
| (10) | Deleted. <Feb. 4, 2020> |
| (11) | Deleted. <Feb. 4, 2020> |
[This Article Wholly Amended on Jan. 30, 2009]
[Title Amended on Feb. 4, 2020]
| Article 13-2 (Reduction of or Exemption from Rent for State or Public Property) |
| (1) | Where land, etc. owned by the State, which fall under any of the following, are leased to a foreign-invested company that runs a business prescribed by Presidential Decree or land, etc, which fall under Article 18 (1) 1 to a repatriating enterprise in a non-Seoul metropolitan area that runs a business prescribed by Presidential Decree, the Minister of Economy and Finance or the head of a central government agency that manages state property may reduce or exempt the rent for the relevant land, etc. in consultation with the Minister of Trade, Industry and Energy, as prescribed by Presidential Decree, notwithstanding Article 38 of the Industrial Sites and Development Act: <Amended on Dec. 22, 2020> |
| 1. | Land, etc. located in a foreign investment zone under Article 18; |
| 2. | Land, etc. located in a national industrial complex under Article 6 of the Industrial Sites and Development Act (hereinafter referred to as “national industrial complex”); |
| 3. | Land, etc. located in a general industrial complex, an urban high-tech industrial complex, or an agro-industrial complex under Article 7, 7-2, or 8 of the Industrial Sites and Development Act. |
| (2) | Where land, etc. owned by the State are leased to the operator of establishments built to improve a foreign investment environment, the Minister of Economy and Finance or the head of a central government agency that manages state property may reduce or exempt the rent for the relevant land, etc. as prescribed by Presidential Decree, notwithstanding Articles 32 (1) and 47 of the State Property Act. |
| (3) | Where land, etc. owned by a local government are leased to a foreign-invested company, etc., the head of the local government may reduce or exempt the rent for the relevant land, etc. as prescribed by Presidential Decree, notwithstanding Articles 22, 24, 32, and 34 of the Public Property and Commodity Management Act. |
| (4) | Where land, etc. leased with the rent reduced or exempted under paragraphs (1) through (3) are located in an industrial complex under subparagraph 8 of Article 2 of the Industrial Sites and Development Act, the lease term may be set within a maximum of 50 years, notwithstanding Article 38 of the same Act. |
| (5) | The lease term referred to in paragraph (4) may be renewed. In such cases, the period of renewal shall not exceed the period specified in paragraph (4). |
[This Article Newly Inserted on Feb. 4, 2020]
| Article 13-3 (Sale of State or Public Property) |
| (1) | The State, etc. may sell their land, etc. to a foreign-invested company, etc. by a negotiated contract, notwithstanding the relevant provisions of any Act falling under any subparagraph of Article 13 (1). |
| (2) | Foreign-invested companies that may purchase land, etc. pursuant to paragraph (1) shall be limited to those that meet the minimum foreign investment ratio prescribed by Presidential Decree, and shall maintain the minimum foreign investment ratio for a period prescribed by Presidential Decree from the date of acquisition of the relevant land, etc.: |
| (3) | In selling land, etc. under paragraph (1) to a foreign-invested company, etc., where it is deemed impracticable for the purchaser to pay the purchase price in a lump sum, the payment deadline may be extended or the payment may be made in installments, as prescribed by Presidential Decree, notwithstanding Article 50 (1) of the State Property Act, Article 37 of the Public Property and Commodity Management Act, and Article 39 (3) of the Act on the Management of Public Institutions. |
[This Article Newly Inserted on Feb. 4, 2020]
| Article 13-4 (Cancellation of Sale of State or Public Property) |
| (1) | Where a foreign-invested company, etc. which have purchased land, etc. by a negotiated contract pursuant to Article 13-3 (1) fall under any of the following, the State, etc. may terminate or cancel the contract for the sale of the land, etc.: |
| 1. | Where the foreign-invested company, etc. fail to pay the purchase price; |
| 2. | Where the foreign-invested company, etc. are found to have concluded the relevant contract by making a false statement or submitting false evidential documents or by other improper means; |
| 3. | Where the foreign-invested company, etc. fail to commence a business by the due date of commencement under the relevant negotiated contract without any extenuating circumstances, after they have concluded the contract; |
| 4. | Where the foreign-invested company, etc. fail to meet the requirements under Article 13 (2) 1 through 4; |
| 5. | Where the foreign-invested company, etc. fail to maintain the minimum foreign investment ratio for a period specified in Article 13-3 (2); |
| 6. | Where the termination or cancellation of the relevant contract is deemed necessary after consultation between the State, etc. and the foreign-invested company, etc. |
| (2) | Where the State, etc. sell land, etc. pursuant to Article 13-3 (1), the relevant foreign-invested company, etc. shall register a special agreement stating that the sales contract may be cancelled where any ground under paragraph (1) 2 through 6 occurs. |
| (3) | Where a contract is terminated or cancelled under paragraph (1), the State, etc. shall take necessary measures to recover the rights to the relevant land, etc., without delay. |
[This Article Newly Inserted on Feb. 4, 2020]
| Article 14 (Support for Foreign Investment Inducement Activities of Local Governments) |
| (1) | Where a local government requests the State to provide funds necessary for the formation of a foreign investment zone prescribed in Article 18, loan for the purchase of land to be leased to any foreign-invested company, etc., reduction or exemption of the rents of land, etc., reduction of lot prices (including such cases where the local government provides the money, where any person prescribed by Presidential Decree leases the land, etc. to any foreign-invested company, etc. with the rents reduced or exempted or sells at a price lower than the land preparation costs, for the portion equivalent to the amount of the rents reduced or exempted as such or to the difference between the land preparation costs and the lot prices), payment of various kinds of subsidies, such as the education and training subsidy, and other foreign investment inducement projects, the State shall provide such funds to the maximum extent possible. |
| (2) | The criteria and procedures for the provision of funds by the State to a local government in accordance with paragraph (1) shall be determined by the Foreign Investment Committee, as prescribed by Presidential Decree. For determining the criteria for the provision of funds in such cases, efforts made by the local government for the inducement of foreign investment and the actual outcomes thereof shall be taken into consideration. |
| (3) | The State shall estimate the amount of funds to be provided in accordance with paragraph (1) each year and include the estimated amount in its budget. |
| (4) | Where necessary for the purpose of promoting the inducement of foreign investment or improving foreign investment environment, a local government may pay a foreign-invested company an employment subsidy, etc. prescribed by Presidential Decree, as prescribed by municipal ordinance. |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 14-2 (Cash Grants for Foreign Investments) |
| (1) | Where a foreigner makes any of the following foreign investments at least at the foreign investment ratio prescribed by Presidential Decree, the State or the competent local government may provide the foreigner with cash grants required for the uses prescribed by Presidential Decree, including the creation or extension of factory facilities, and research and development, taking into account whether the relevant foreign investment accompanies high technology, the effect of technology transfer, the scale of job creation, whether the foreign investment overlaps any domestic investment, the propriety of the location in which the foreign investment is made, etc.: <Amended on Apr. 5, 2010; Jan. 28, 2015; Dec. 31, 2019; Feb. 4, 2020> |
| 1. | Where the foreigner installs a new factory facility or expands an existing facility (referring to a place of business in cases of any business other than the manufacturing business) in order to run the business provided in Article 121-2 (1) 1 of the Restriction of Special Taxation Act; |
| 2. | Where the foreigner installs a new factory facility or expands an existing facility (referring to a place of business in cases of any business other than the manufacturing business) in order to run the business of advanced technology and advanced products under Article 5 of the Industrial Development Act; |
| 3. | Where the foreigner installs a new factory facility or expands an existing factory facility in order to produce materials, components, and equipment defined in subparagraphs 1 and 2 of Article 2 of the Act on Special Measures for Strengthening the Competitiveness of Materials, Components and Equipment Industries as prescribed by Presidential Decree; |
| 4. | Where the foreigner installs a new factory facility or expands an existing factory facility (referring to a place of business in cases of any business other than the manufacturing business) which creates new employment exceeding the number of regular workers prescribed by Presidential Decree; |
| 5. | Where the number of regular employment of full-time researchers is five or more persons, consisting of persons holding at least a master's degree in a field related to the business provided in Article 121-2 (1) 1 of the Restriction of Special Taxation Act, the business of advanced technology and advanced products under Article 5 of the Industrial Development Act, or the business of materials and components under subparagraph 1 of Article 2 of the Act on Special Measures for Strengthening the Competitiveness of Materials, Components and Equipment Industries (hereafter in this subparagraph referred to as "business"), or persons holding a bachelor's degree in a field related to such business with at least three years’ research experience, which meets any of the following requirements: |
| (a) | Where the foreigner installs a new research facility or expands an existing research facility in order to conduct research and development activities for the relevant business; |
| (b) | Where a non-profit corporation that has received contributions pursuant to Article 2 (1) 4 (c) newly installs or expands research facilities; |
| 6. | Where it is an investment that has a large effect on the domestic economy for its amount, for which the Foreign Investment Committee deems it necessary to provide cash grants in accordance with the standards prescribed by Presidential Decree with respect to the requirements for foreign investors, etc. |
| (2) | The amount of cash grants referred to in paragraph (1) shall be determined after negotiations with the relevant foreigner and deliberation by the Foreign Investment Committee. |
| (3) | Matters necessary for the methods, procedures, etc. for providing cash grants under paragraph (1) shall be prescribed by Presidential Decree. |
| (4) | In cases of cash grants under paragraph (1), the local government may by ordinance prescribe matters necessary for the determination on the provision of cash grants, the methods for calculating limits on cash grants, the procedures for negotiating the investment support with foreigners, and other similar matters, except as provided in paragraph (3). |
| (5) | Where an applicant for cash grants under paragraph (1) files the application by fraud or other improper means or any other ground prescribed by Presidential Decree occurs, the State or the local government shall cancel or revoke the provision of cash grants or reduce or recover the amount of cash grants, after deliberation and decision by the Foreign Investment Committee. <Newly Inserted on Feb. 4, 2020> |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 14-3 (Monetary Rewards for Inducing Foreign Investment) |
| (1) | The head of a local government may grant monetary rewards to a person recognized as having greatly contributed to inducing foreign investment in proportion to the outcomes of inducing foreign investment, as prescribed byordinance of the local government. |
| (2) | The head of a public institution may grant monetary rewards to a person recognized as having greatly contributed to inducing foreign investment according to the standards established by the Minister of Trade, Industry and Energy, after deliberation and decision by the Foreign Investment Committee in proportion to the outcomes of inducing foreign investment: |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 15 (Establishment of Foreign Investor Support Center) |
| (1) | A Foreign Investor Support Center (hereinafter referred to as the "Investment Support Center") shall be established in the Korea Trade-Investment Promotion Agency in order to conduct consultations, guidance, advertisement, investigation, research, and treatment of civil petitions either directly or by proxy, the nurturing of business start-up, etc. concerning foreign investment and provide comprehensive support measures for foreign investors and foreign-invested companies. <Amended on Apr. 5, 2010> |
| (2) | Where necessary to properly perform foreign investment-related affairs, the president of the Korea Trade-Investment Promotion Agency may request the relevant administrative agencies, corporations or organizations related to foreign investment (hereinafter referred to as "foreign-investment related agencies") to dispatch their public officials or executives and employees to render service at the Investment Support Center: |
| (3) | Where necessary to efficiently manage foreign investment-related duties by foreign investors or foreign-invested companies, the president of the Korea Trade-Investment Promotion Agency may request the head of a relevant administrative agency having jurisdiction over the relevant duty to establish a sub-branch of the agency within the Investment Support Center. In such cases, the head of the agency upon receipt of such request shall comply therewith, unless other specific grounds exist to the contrary. |
| (4) | The Investment Support Center shall be run mainly by officers and employees of the Korea Trade-Investment Promotion Agency who have considerable knowledge and experience in foreign investment, and public officials or the officers and employees of foreign-investment related agencies dispatched to the Investment Support Center in accordance with paragraph (2) (hereinafter referred to as "dispatched officers") shall render their support for the business matters of the Investment Support Center. |
| (5) | The head of a relevant administrative agency or a foreign-investment related agency to whom a request for dispatching public officials or officers or employees has been made in accordance with paragraph (2) shall select those who are well-suited for the business matters in question and dispatch them, unless other specific grounds exist to the contrary, and where he or she intends to stop the dispatched service before the period for service expires, he or she shall consult in advance with the president of the Korea Trade-Investment Promotion Agency. |
| (6) | The head of a relevant administrative agency or a foreign-investment related agency who dispatches public officials or officers or employees under his or her jurisdiction in accordance with paragraph (2) may give preferential treatment to the dispatched officers in terms of their promotion, position transfer, rewards, and welfare measures. |
| (7) | Where necessary to conduct the business under paragraph (1), the president of the Korea Trade-Investment Promotion Agency may request the relevant administrative agency or the foreign-investment related agency to request cooperation, and the head of the agency in receipt of such request shall comply therewith, unless other specific grounds exist to the contrary. |
| (8) | Deleted. <Apr. 5, 2010> |
| (9) | Matters necessary for the composition and operation of the Investment Support Center shall be prescribed by Presidential Decree. <Amended on Apr. 5, 2010> |
[This Article Wholly Amended on Jan. 30, 2009]
[Title Amended on Apr. 5, 2010]
| Article 15-2 (Foreign Investment Ombudsmen) |
| (1) | In order to resolve complaints from foreign investors and foreign-invested companies, a foreign investment ombudsman shall be commissioned from among persons with abundant knowledge and experience in foreign investment affairs. <Amended on Apr. 5, 2010> |
| (2) | The foreign investment ombudsman under paragraph (1) (hereinafter referred to as the "foreign investment ombudsman") shall be commissioned by the President, after the recommendation of the Minister of Trade, Industry and Energy and deliberation and decision by the Foreign Investment Committee. <Amended on Mar. 23, 2013> |
| (3) | Where necessary for resolving complaints from foreign investors and foreign-invested companies, the foreign investment ombudsman may request the head of a relevant administrative agency and the head of a foreign-investment related agency (hereinafter referred to as "relevant administrative agency, etc.") to render the following necessary cooperation. In such cases, the head of the relevant administrative agency, etc. in receipt of such request shall comply therewith, except in extenuating circumstances: <Amended on Apr. 5, 2010> |
| 1. | Giving explanations of a relevant administrative agency, etc. or submitting data in accordance with the standards prescribed by Presidential Decree; |
| 2. | Stating opinions of related employees, interested persons, etc.; |
| 3. | Rendering cooperation for site visits. |
| (4) | Where deemed necessary after resolving complaints from foreign investors and foreign-invested companies, the foreign investment ombudsman may recommend the heads of relevant administrative agencies and the heads of public institutions to take corrective measures on related affairs. <Newly Inserted on Apr. 5, 2010> |
| (5) | Upon receipt of recommendations made under paragraph (4), the heads of relevant administrative agencies or public institutions shall, in writing, notify the foreign investment ombudsman of handling results within the period prescribed by Presidential Decree. <Newly Inserted on Dec. 11, 2012> |
| (6) | Where the heads of relevant administrative agencies or public institutions fail to implement recommendations made under paragraph (4), the foreign investment ombudsman may request them to submit matters concerning such recommendations to the Foreign Investment Committee as an agenda. <Newly Inserted on Dec. 11, 2012> |
| (7) | In order to promote the improvement of regulations on complaints from foreign investors and foreign-invested companies in an organized manner, the foreign investment ombudsman shall prepare an annual report on reorganization activities, such as the current status of regulations and systems obstructing foreign investment, results of improvement thereof, etc., and submit the report to the Foreign Investment Committee, as prescribed by Presidential Decree. <Newly Inserted on Dec. 11, 2012> |
| (8) | The foreign investment ombudsman shall not use data received from the heads of relevant administrative agencies, etc. pursuant to paragraph (3) or confidential information that he or she has become aware of in the course of performing duties for any purposes other than those prescribed by this Act, or divulge it to any third party. <Amended on Apr. 5, 2010; Dec. 11, 2012> |
| (9) | The foreign investment ombudsman shall be deemed a public official for purposes of applying the penalty provisions of Articles 129 through 132 of the Criminal Act. <Amended on Apr. 5, 2019; Dec. 11, 2012> |
| (10) | A grievance committee shall be established within the Korea Trade-Investment Promotion Agency in order to support the duties of the foreign investment ombudsman. <Newly Inserted on Apr. 5, 2010; Dec. 11, 2012> |
| (11) | Matters necessary for the composition and operation of the grievance committee shall be prescribed by Presidential Decree. <Newly Inserted on Apr. 5, 2010; Dec. 11, 2012> |
[This Article Wholly Amended on Jan. 30, 2009]
[Title Amended on Apr. 5, 2010]
| Article 16 (Foreign Investment Promotion Offices) |
| (1) | Central administrative agencies, the Special Metropolitan City, Metropolitan Cities, the Special Self-Governing City, |
| (2) | When a foreign investment promotion official receives a request for cooperation by a relevant administrative agency, the Investment Support Center, or the grievance committee with respect to civil petitions concerning foreign investment, he or she shall cooperate in a positive manner. <Amended on Apr. 5, 2010> |
| (3) | Except as provided in paragraphs (1) and (2), matters necessary for the functions and business of the foreign investment promotion office shall be prescribed by Presidential Decree. |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 17 (Special Cases concerning Handling of Civil Petitions by Foreign Investors) |
| (1) | Where a foreign investor or a foreign-invested company has been granted permission, etc. in the left column of attached Table 1, he, she, or it shall be deemed to have been granted permission, etc. in the right column of the same Table. <Amended on Jan. 30, 2009> |
| (2) | A dispatched officer may directly handle civil petitions prescribed by Presidential Decree which are related to foreign investment of a foreign investor or a foreign-invested company (hereinafter referred to as "civil petitions to be handled directly"). In such cases, the head of the relevant administrative agency to which the dispatched officer belongs shall entrust the dispatched officer with such civil petitions and give him or her approval authority therefor. <Amended on Jan. 30, 2009> |
| (3) | A foreign investor or a foreign-invested company may request the Investment Support Center to file civil petitions on behalf of him, her, or it, such as filling out and submitting application forms relating to civil affairs. The head of the Investment Support Center thus requested shall select civil petitions related to the permission, etc. listed in attached Table 1 (hereinafter referred to as "civil petitions to be handled in bulk") and civil petitions related to foreign investment listed in attached Table 2 to be individually handled (hereinafter referred to as "civil petitions to be handled individually"), and transfer them to the head of the relevant civil affairs administrative agency for disposition; and shall notify the foreign investment promotion official under his or her jurisdiction of such fact. <Amended on Jan. 30, 2009> |
| (4) | The head of a civil affairs administrative agency to whom an application form relating to civil affairs has been transferred pursuant to paragraph (3), or who has received an application form relating to civil affairs from a foreign investor or a foreign-invested company, shall consult with the head of the relevant administrative agency without delay, and the head of the relevant administrative agency shall submit his or her opinion within the period for handling prescribed in paragraph (5). If the head of the relevant administrative agency disagrees, he or she shall explicitly express his or her reasons therefor, and if the head of the relevant administrative agency does not submit his or her opinion within the period for handling prescribed in paragraph (5), he or she shall be deemed to have no opinion on the matter. <Amended on Jan. 30, 2009> |
| (5) | Notwithstanding the relevant provisions of other statutes and regulations, the head of a civil affairs administrative agency or a dispatched officer shall handle civil petitions to be handled in bulk (referring to those civil petitions relating to the permission, etc. listed on the right column of attached Table 1, which have been received individually), civil petitions to be individually handled, and civil petitions to be handled directly, within the period for handling prescribed in Presidential Decree, and where the head of the civil affairs administrative agency or the dispatched officer has not notified the relevant person of the refusal of the application for permission, etc. within the period for handling, the permission, etc. shall be deemed granted as of the day immediately following the last day of the period for handling. In such cases, if the head of the civil affairs administrative agency or the dispatched officer intends to refuse the application for permission, etc. within the period for handling, he or she shall notify the relevant foreign investment promotion official, foreign investor, or foreign-invested company in writing of the reasons for refusal, as prescribed by Presidential Decree. <Amended on Jan. 30, 2009> |
| (6) | Where permission, etc. is deemed granted pursuant to the former part of paragraph (5), the head of the civil affairs administrative agency or the dispatched officer shall issue, upon request of the relevant foreign investor or foreign-invested company, a document certifying the grant of the permission, etc. without delay. <Amended on Jan. 30, 2009> |
| (7) | Where the foreign investor or foreign-invested company that was notified of the refusal of his, her, or its application for permission pursuant to the latter part of paragraph (5) resolves the issues that are the reasons for the refusal and submits a document certifying that he or she satisfies the conditions for the grant of the permission, etc. as prescribed by the relevant statutes and regulations, the head of the civil affairs administrative agency or the dispatched officer shall grant the originally intended permission, etc. within the period prescribed by Presidential Decree. In such cases, the head of the civil affairs administrative agency or the dispatched officer shall not refuse to grant the permission, etc. for any other reason than the ones given before. <Amended on Jan. 30, 2009> |
| (8) | Paragraph (7) shall apply |
| (9) | Where a foreign investor or a foreign-invested company intends to obtain permission, etc. relating to civil petitions to be handled in bulk, civil petitions to be handled individually, and civil petitions to be handled directly pursuant to paragraphs (2) through (8), he or she or it shall submit application documents prescribed by Ordinance of the Ministry of Trade, Industry and Energy, notwithstanding the provisions of other statutes and regulations. <Amended on Jan. 30, 2009; Mar. 23, 2013> |
| (10) | Even when some of the requirements for the grant of permission, etc. relating to civil petitions to be handled in bulk, such as accompanying documents, have not been satisfied, the head of a civil affairs administrative agency may grant permission, etc. on the condition that the unsatisfied requirements shall be met, as prescribed by Presidential Decree. <Amended on Jan. 30, 2009> |
| (11) | Where a statute or regulation other than this Act includes the provisions concerning civil affairs which can lead to realization of the goal of a foreign-invested company, which is possible only with permission, etc. granted under relevant statutes and regulations from the time the foreign investment was reported to the time the relevant business is launched, and which do not fall under any of the following subparagraphs, such statutes and regulations shall not apply to foreign investment by a foreign investor or foreign-invested company: <Amended on Jan. 30, 2009> |
| 1. | Civil petitions to be handled in bulk; |
| 2. | Civil petitions to be handled individually; |
| 3. | Civil petitions to be handled directly; |
| 4. | Other civil petitions relating to permission, etc. under this Act. |
| (12) | Deleted. <Dec. 31, 2003> |
| (13) | Except as provided for in paragraphs (1) through (11), matters necessary for handling civil petitions relating to foreign investment shall be prescribed by Presidential Decree. <Amended on Jan. 30, 2009> |
CHAPTER IV FOREIGN INVESTMENT ZONES
| Article 18 (Designation of Foreign Investment Zones) |
| (1) | The Mayors/ |
| 1. | A zone designated to lease to foreign-invested companies or repatriating enterprises in a non-Seoul Metropolitan area or to exclusively transfer to foreign-invested companies among national industrial complexes designated under Article 6 of the Industrial Sites and Development Act and general industrial complexes designated under Article 7 of the same Act; |
| 2. | A zone in which any foreign investor intends to make a foreign investment meeting the standards prescribed by Presidential Decree; |
| 3. | An exclusive zone designated to lease or transfer land therein to foreign-invested companies that carry out research and development, among areas prescribed by Presidential Decree (including buildings in such areas; hereafter in this subparagraph the same shall apply), such as special research and development zones under subparagraph 1 of Article 2 of the Special Act on Promotion of Special Research and Development Zones; |
| 4. | A zone (including buildings) designated after consultation with the head of a relevant central administrative agency to lease or transfer land therein to foreign-invested companies running a service business of high added value, such as finance, and prescribed by Presidential Decree. In such cases, if deemed necessary for attracting foreign investment, a portion not exceeding the percentage prescribed by Presidential Decree of the total area designated (referring to the sum of floor space of each floor in cases of buildings) may be lent or transferred to companies that carry out the same business as foreign-invested companies. |
| (2) | Where two or more foreign investors intend to obtain the designation of a zone referred to in paragraph (1) 2 as a foreign investment zone pursuant to the former part, with the exception of the subparagraphs, of paragraph (1) from the relevant Mayor/ |
| (3) | When a Mayor/ |
| 1. | Purpose, name, location, and scope of a foreign investment zone; |
| 2. | Type of business to move into a foreign investment zone and qualifications of companies to move into such zone; |
| 3. | Costs and effects that come after the designation of a foreign investment zone; |
| 4. | Methods of development and management of a foreign investment zone; |
| 5. | Implementation method and period of the project to construct a foreign investment zone; |
| 6. | Matters prescribed by Presidential Decree based on the characteristics of each region, such as land utilization and prevention of overpopulation. |
| (4) | Where a Mayor/ |
| 1. | Official title, location, and area of the foreign investment zone; |
| 2. | Methods of development or management; |
| 3. | Matters to be publicly notified under Article 7-4 of the Industrial Sites and Development Act (limited to where the relevant foreign investment zone is to be developed into a general industrial complex or urban high-tech complex); |
| 4. | Details of investment, scale of employment and details of businesses of foreign-invested companies and repatriating enterprises in a non-Seoul Metropolitan area to move into the foreign investment zone; |
| 5. | Other matters specified by Presidential Decree. |
| (5) | Where a Mayor/ |
| (6) | Matters necessary for the procedures for, and methods of, the designation of foreign investment zones shall be prescribed by Presidential Decree. <Amended on Apr. 5, 2010; Feb. 4, 2020> |
[This Article Wholly Amended on Jan. 30, 2009]
[Title Amended on Feb. 4, 2020]
| Article 18-2 (Cancellation of Designation of Foreign Investment Zones) |
| (1) | Where a foreign-invested company or a foreign investment zone fails to satisfy the standards prescribed by Presidential Decree under Article 18 (1) and (2), the competent Mayor/ |
| (2) | Matters necessary for the procedures of cancellation of designation of foreign investment zones under paragraph (1) and other matters shall be prescribed by Presidential Decree. |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 18-3 (Development and Management of Foreign Investment Zones) |
| (1) | A foreign investment zone designated within a national industrial complex from among industrial complexes shall be managed by the management agency of the relevant national industrial complex; a foreign investment zone designated within an industrial complex other than a national industrial complex shall be managed by the competent Mayor/ |
| (2) | Where the development of a new site is necessary to build factories, etc. in an area designated as a foreign investment zone, the foreign investment zone may be developed into a general industrial complex or an urban high-tech industrial complex. |
| (3) | Where a foreign investment zone is developed into a general industrial complex or an urban high-tech industrial complex pursuant to paragraph (2), the foreign investment zone referred to in Article 18 (1) or (2) shall be deemed to be designated as a general industrial complex or an urban high-tech industrial complex. In such cases, a development plan under the latter part, with the exception of the subparagraphs, of Article 18 (1) shall be deemed a development plan under Article 7 (2) or 7-2 (4) of the Industrial Sites and Development Act, and a public notice under Article 18 (4) shall be deemed a public notice under Article 7-4 of the Industrial Sites and Development Act. |
| (4) | Where there is any designation or public notice under Article 18 (1) through (4) in developing a foreign investment zone into a general industrial complex or an urban high-tech industrial complex pursuant to paragraph (2), “industrial complex” referred to in Article 12 (1) of the Industrial Sites and Development Act shall be construed as “foreign investment zone”, and “when an industrial complex ... is designated or publicly notified” in Article 22 (2) of the same Act shall be construed as “when a foreign investment zone is designed or publicly notified”. |
| (5) | Matters necessary for development and management under paragraph (1), including the conclusion and termination of occupancy contracts, shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Feb. 4, 2020]
| Article 19 (Support Measures for Foreign Investment Zones) |
| (1) | Articles 28 and 29 of the Industrial Sites and Development Act shall apply |
| (2) | The traffic generation charges imposed under Article 36 of the Urban Traffic Improvement Promotion Act shall be exempted for the construction of facilities, etc. in a foreign investment zone. |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 20 (Special Cases concerning Other Statutes) |
| (1) | Article 56 (1) 4 of the National Land Planning and Utilization Act shall not apply to partitioning of land within a foreign investment zone. |
| (2) | Restrictions on export or import may be relaxed for a foreign-invested company that takes occupancy in a foreign investment zone, as prescribed by the Minister of Trade, Industry and Energy, notwithstanding Article 11 of the Foreign Trade Act. <Amended on Mar. 23, 2013> |
| (3) | The following statutes shall not apply to a foreign-invested company that takes occupancy in a foreign investment zone: <Amended on Aug. 4, 2011; Sep. 15, 2011; Jan. 5, 2021> |
| 1. | Deleted; <Jan. 27, 2016> |
| 2. | Article 33-2 (1) of the Act on the Honorable Treatment of and Support for Persons, etc. of Distinguished Service to the State, Article 39 (1) of the Act on Support for Persons Eligible for Veteran's Compensation, Article 24-2 (1) of the Act on the Honorable Treatment of Persons of Distinguished Service to the May 18 Democratization Movement and Establishment of Related Organizations, and Article 21 (2) of the Act on Honorable Treatment of Persons of Distinguished Service during Special Military Missions and Establishment of Related Associations. |
| (4) | Notwithstanding Article 20 (1) of the Industrial Cluster Development and Factory Establishment Act, a foreign-invested company that takes occupancy in a foreign investment zone may undertake new establishment, expansion or transfer of a factory of at least 500 square meters (including a knowledge industry center) or change its business type in a growth administration zone. <Newly Inserted on Apr. 5, 2010> |
[This Article Wholly Amended on Jan. 30, 2009]
[Article 20 (3) 2 applicable until Dec. 31, 2011]
CHAPTER V FOLLOW-UP MANAGEMENT OF FOREIGN INVESTMENT
| Article 21 (Follow-Up Management of Foreign Investment) |
| (1) | A foreign investor or a foreign-invested company that falls under any of the following (including cases falling under any of the following due to capital increase) shall file for registration as a foreign-invested company, as prescribed by Presidential Decree: <Amended on Jan. 27, 2016; Feb. 4, 2020> |
| 1. | Where he, she, or it has completed payment for the object of investment; |
| 2. | Where he, she, or it has completed the acquisition of stocks, etc. (referring to having paid for the stocks, etc.) by the methods prescribed in Article 2 (1) 4 (a); |
| 3. | Where he, she, or it has completed contribution by the methods prescribed in Article 2 (1) 4 (c) and (e); |
| 4. | Deleted. <Jan. 27, 2016> |
| (2) | Notwithstanding paragraph (1), when a foreign investor or a foreign-invested company making a foreign investment defined under Article 2 (1) 4 (a) meets requirements prescribed by Presidential Decree, such as the investment amount, he, she, or it may file for registration as a foreign-invested company even prior to completing payment for the object of investment under paragraph (1) 1 or the acquisition of stocks, etc. under paragraph (1) 2. <Amended on Jan. 27, 2016> |
| (3) | A foreign investor or a foreign-invested company shall file for registration of modification, as prescribed by Ordinance of the Ministry of Trade, Industry and Energy, in any of the following cases: <Amended on Jan. 27, 2016> |
| 1. | Where he, she, or it has filed a report on foreign investment by any of the methods prescribed in Article 5 (2) 2 through 6; |
| 2. | Where he, she, or it falls under Article 121-5 (2) 2 of the Restriction of Special Taxation Act; |
| 3. | Where stocks, etc. owned by the foreign investor are reduced following transfer of the stocks, etc. he or she has acquired under Article 5 or 6 to a third person, or the capital reduction of the relevant foreign-invested company; |
| 4. | Where any of the matters prescribed by Ordinance of the Ministry of Trade, Industry and Energy, such as the foreign investment ratio and the trade name or name of the foreign-invested company, is changed. |
| (4) | Where a foreign investor or a foreign-invested company falls under any of the following, the Minister of Trade, Industry and Energy may revoke the permission therefor or cancel the registration thereof: |
| 1. | Where the foreign-invested company reports the closure of its business under Article 8 (8) of the Value-Added Tax Act; |
| 2. | Where the foreign investor has transferred all of the stocks, etc. owned by himself or herself to a national of the Republic of Korea or a Korean corporation or enterprise, or has ceased to hold all of the stocks, etc. due to the capital reduction of the relevant foreign-invested company; |
| 3. | Where he, she or it has filed for registration as a foreign-invested company as if payment for the object of investment were completed. |
| (5) | No foreign-invested company registered under paragraph (1) shall engage in any of the following conducts, except in cases meeting the criteria prescribed by Presidential Decree: <Newly Inserted on Jan. 27, 2016> |
| 1. | Running a business in which foreign investment is restricted under Article 4 (3), in excess of the allowed limit; |
| 2. | Acquiring stocks of any third domestic company that runs a business in which foreign investment is restricted under Article 4 (3), in excess of the allowed limit. |
| (6) | No foreign investor or foreign-invested company shall use investment funds for any purpose other than the reported or permitted purpose, or transfer or lend the registration certificate of the relevant foreign-invested company to any third person. <Newly Inserted on Jan. 27, 2016> |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 22 (Cooperation in Follow-Up Management of Foreign Investment) |
| (1) | Upon receipt of an application for registration of alteration filed by a foreign investor or foreign-invested company pursuant to Article 21 (3) in relation to the transfer or reduction of stocks, etc., the Minister of Trade, Industry and Energy shall notify the details of the application to the Commissioner of the National Tax Service, the Commissioner of the Korea Customs Service, and a Mayor/ |
| (2) | The Minister of Trade, Industry and Energy may request the Commissioner of the National Tax Service and the head of a regional tax office to provide information on whether a foreign-invested company registered under Article 21 has closed its business and the date of business closure among the business registration information pursuant to Article 8 of the Value-Added Tax Act. |
| (3) | Upon receipt of a request from the Minister of Trade, Industry and Energy under paragraph (2), the Commissioner of the National Tax Service and the head of a regional tax office shall provide the relevant information for the Minister of Trade, Industry and Energy without delay. |
| (4) | The Commissioner of the National Tax Service shall investigate whether a foreign-invested company has violated Article 21 (5) or (6) with respect to the business affairs under his/her jurisdiction, and notify the results thereof to the Minister of Trade, Industry and Energy, as prescribed by Ordinance of the Ministry of Trade, Industry and Energy. |
[This Article Wholly Amended on Jan. 27, 2016]
| Article 23 Deleted. <Jan. 27, 2016> |
| Article 24 (Collection and Compilation of Statistics on Foreign Investment) |
| (1) | The Minister of Trade, Industry and Energy may request the Mayors/ |
| (2) | Upon receipt of a request to provide data and statistics made under paragraph (1), the Mayors/ |
| (3) | No public officials who collect and compile data and statistics on foreign investment pursuant to paragraphs (1) and (2) shall divulge any trade secret of the relevant companies. |
[This Article Wholly Amended on Jan. 30, 2009]
CHAPTER VI Deleted.
| Article 25 Deleted. <Jan. 27, 2016> |
| Article 26 Deleted. <Jan. 27, 2016> |
CHAPTER VII SUPPLEMENTARY PROVISIONS
| Article 27 (Foreign Investment Committee) |
| (1) | A Foreign Investment Committee shall be established under the Ministry of Trade, Industry and Energy to deliberate on the following: <Amended on Dec. 11, 2012; Mar. 23, 2013; Jan. 10, 2014; Feb. 4, 2020> |
| 1. | Important matters concerning the basic policy and schemes for foreign investment; |
| 2. | Matters concerning integration and coordination of the measures by competent Ministry to improve an environment for foreign investment; |
| 3. | Matters concerning the criteria for tax reductions or exemptions for foreign-invested companies; |
| 4. | Matters concerning cooperation among, and coordination of different opinions of, central administrative agencies, Special Metropolitan City, Metropolitan Cities, Special Self-Governing City, |
| 5. | Matters concerning stimulus plans; |
| 6. | Matters concerning contributions to non-profit corporations defined in Article 2 (1) 4 (e); |
| 7. | Matters concerning support for local governments under Article 14; |
| 8. | Matters concerning cash grants under Article 14-2; |
| 9. | Matters concerning the payment of monetary rewards for inducing foreign investment under Article 14-3 (2); |
| 10. | Matters concerning the designation of foreign investment zones and assistance thereto under Articles 18 and 19; |
| 11. | Matters concerning approval under Article 30 (7); |
| 12. | Other important matters concerning the inducement of foreign investment. |
| (2) | The Minister of Trade, Industry and Energy shall be the Chairperson of the Foreign Investment Committee, and the following persons shall be its members: <Amended on Apr. 5, 2010; Jun. 4, 2010; Dec. 11, 2012; Mar. 23, 2013; Nov. 19, 2014; Jul. 26, 2017; Feb. 4, 2020> |
| 1. | The Vice Minister of Economy and Finance, the Vice Minister of Education, the Vice Minister of Ministry of Science and ICT, the Vice Minister of Foreign Affairs, the Vice Minister of National Defense, the Vice Minister of the Interior and Safety, the Vice Minister of Culture, Sport and Tourism, the Vice Minister of Agriculture, Food and Rural Affairs, the Vice Minister of Environment, the Vice Minister of Employment and Labor, the Vice Minister of Land, Infrastructure and Transport, the Vice Minister of Oceans and Fisheries, the Minister of the Defense Acquisition Program Administration, and the Vice Chairperson of the Financial Services Commission; |
| 2. | The Deputy Director of the National Intelligence Service designated by the Director of the National Intelligence Service; |
| 3. | The Vice Ministers, vice chairpersons, or deputy administrators of central administrative agencies related to the agendas submitted to the Foreign Investment Committee, the Vice Mayor of Seoul Special Metropolitan City, Mayors/ |
| (3) | A Foreign Investment Working Committee (hereinafter referred to as "Working Committee") shall be established to review and coordinate matters to be deliberated upon by the Foreign Investment Committee, and to deliberate on matters entrusted by the Foreign Investment Committee, as prescribed by Presidential Decree. |
| (4) | The Minister of Trade, Industry and Energy shall report to the Foreign Investment Committee on the current status of improving an environment for foreign investment referred to in paragraph (1) 2. <Amended on Mar. 23, 2013> |
| (5) | Except as provided for in paragraphs (1) through (3), matters necessary for the composition and operation of the Foreign Investment Commission and the Working Committee shall be prescribed by Presidential Decree. |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 28 (Reporting, Investigation, and Correction) |
| (1) | The Minister of Trade, Industry and Energy and the competent Minister may require foreign investors, foreign-invested companies, the president of the Korea Trade-Investment Promotion Agency, the heads of the relevant financial institutions, and other interested parties to report on matters deemed necessary concerning foreign investment under this Act. <Amended on Mar. 23, 2013; Jan. 27, 2016> |
| (2) | The Minister of Trade, Industry and Energy may require subordinate public officials or the heads of the relevant administrative agencies to conduct investigations into the following, where deemed necessary for the enforcement of this Act: <Amended on Mar. 23, 2013> |
| 1. | Matters concerning the introduction, use, and disposal of the funds (including objects of investment; hereafter in this Article the same shall apply) and capital goods invested by foreigners; |
| 2. | Deleted; <Jan. 27, 2016> |
| 3. | Matters concerning the implementation of the matters permitted or reported under this Act. |
| (3) | To conduct an investigation under paragraph (2), the subject of the investigation shall be notified of the investigation plan which includes the time and date, grounds, details, etc. by no later than seven days prior to the investigation: |
| (4) | Anyone who conducts an investigation under paragraph (2) shall carry a certificate of identification indicating his/her authority and produce it to relevant persons, and deliver a document stating the name, time of access, aim of access, etc. at the time he or she gets access, to relevant persons. |
| (5) | In any of the following cases, the Minister of Trade, Industry and Energy may issue a corrective order or take other necessary measures against the relevant foreign investors, foreign-invested companies, person who has introduced or used funds or capital goods invested by a foreigner into Korea, and any other interested party: <Amended on Mar. 23, 2013; Jan. 27, 2016> |
| 1. | Where a person fails to implement the matters permitted or reported under this Act, or where what the person has implemented is illegal or unjust; |
| 2. | Where a person has discovered any of the facts provided in the subparagraphs of Article 4 (2). |
| (6) | Where a foreign investor (including a foreign investor that fails to file for registration under Article 21 (1)) falls under any of the following, he or she shall transfer the stocks, etc. he or she owns to a national of the Republic of Korea or a Korean corporation or enterprise within six months from the day referred to in the following: |
| 1. | Where he or she fails to comply with a corrective order issued under paragraph (5), the day on which the period for complying with such corrective order expires; |
| 2. | Where permission is revoked or registration is cancelled under Article 21 (4) 3, the day on which the permission is revoked or the registration is cancelled. |
| (7) | Where a person who has introduced funds and capital goods into Korea for foreign investment fails to clear the capital goods through the customs or fails to take the custody thereof within the storage period prescribed by the Customs Act, the head of the customs office may sell them, as prescribed by Presidential Decree. <Amended on Jan. 27, 2016> |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 29 (Examination and Confirmation of Introduced Capital Goods) |
| (1) | Where a foreign investor or a foreign-invested company introduces capital goods which meet the criteria prescribed by Presidential Decree, such as capital goods introduced into Korea under this Act which are subject to tax reduction or exemption, or goods, other than capital goods, which are introduced into Korea for foreign investment falling under Article 2 (1) 4 (c) and (e) (hereafter in this Article referred to as "capital goods, etc."), the investor or company may receive examination and confirmation of the introduced capital goods, etc. from the competent Minister. <Amended on Feb. 4, 2020> |
| (2) | Any capital goods, etc. examined and confirmed by the competent Minister in accordance with paragraph (1) shall be deemed to have obtained the import approval under the Foreign Trade Act. |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 30 (Relationship to Other Statutes and International Treaties) |
| (1) | Except as otherwise provided in this Act, matters concerning foreign exchanges and foreign trades shall be governed by the Foreign Exchange Transactions Act. |
| (2) | Notwithstanding the proviso of Article 462-2 (1) of the Commercial Act, a foreign-invested company may pay dividends with its newly issued stocks up to an amount equivalent to its total dividend amount, where a special resolution has been passed under Article 434 of the Commercial Act. |
| (3) | Where a foreign investor makes an investment in kind with the capital goods defined under Article 2 (1) 8 (b), the certificate of completion of the investment in kind for which the Commissioner of the Korea Customs Service verified the implementation of the investment in kind and the type, volume, and price of the objects of the investment in kind, shall be deemed a written report of investigation by an investigator under the Article 299 of the Commercial Act, notwithstanding Article 299 of the same Act. The same shall also apply where he or she makes an investment in kind with the capital goods after he or she has established a company. <Amended on May 20, 2014> |
| (4) | Where a technology evaluation agency prescribed by Presidential Decree has evaluated the price of an industrial property right defined under Article 2 (1) 8 (d), such evaluation shall be deemed appraised by an appraiser publicly certified under Article 299-2 of the Commercial Act. |
| (5) | A national of the Republic of Korea or a Korean corporation or enterprise that intends to conduct a business jointly with a foreign investor who has filed a report to make a foreign investment by the method prescribed in Article 2 (1) 4 (a) (i) may designate the first day of each month as the re-evaluation day and re-evaluate the objects of the relevant investment, as prescribed in the Assets Revaluation Act, notwithstanding Article 4 of the Assets Revaluation Act. <Amended on Jan. 27, 2016; Feb. 4, 2020> |
| (6) | Notwithstanding Article 8-2 (4) of the Monopoly Regulation and Fair Trade Act, a second-tier subsidiary of a general holding company may hold stocks of a joint stock corporation with a foreigner, where it meets all of the following requirements: <Newly Inserted on Jan. 10, 2014> |
| 1. | Such stock holding shall be a foreign investment meeting the standards referred to in Article 18 (1) 2; |
| 2. | The second-tier subsidiary of the general holding company shall hold at least 50/100 of the total number of stocks issued by such joint stock corporation; |
| 3. | A foreigner shall hold at least 30/100 (the share-holding ratio of the foreigner shall be calculated only for the stocks held at and after the time the joint stock corporation is formed) of the total number of stocks issued by such joint stock corporation; |
| 4. | The second-tier subsidiary of the general holding company shall hold all the outstanding shares issued by such joint stock corporation, except those held by foreigners. |
| (7) | Each second-tier subsidiary of a general holding company that intends to hold stocks of a joint stock corporation under paragraph (6) shall obtain approval from the Foreign Investment Committee. In such cases, the Minister of Trade, Industry and Energy shall submit the relevant case to the Fair Trade Commission for the prior deliberation of the requirements prescribed by Presidential Decree, including the joint stock corporation’s business relevance with the second-tier subsidiary and the second-tier subsidiary’s qualification to become a stakeholder in the joint stock corporation. <Newly Inserted on Jan. 10, 2014> |
| (8) | “General holding company”, “second-tier subsidiary”, and “joint stock corporation” referred to in paragraphs (6) and (7) have the same meanings defined by the Monopoly Regulation and Fair Trade Act. <Newly Inserted on Jan. 10, 2014> |
| (9) | None of the provisions of this Act shall be construed as amending or limiting any terms and conditions of international treaties the Republic of Korea has entered into and promulgated. <Newly Inserted on Jan. 10, 2014> |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 30 (Relationship to Other Statutes and International Treaties) |
| (1) | Except as otherwise provided in this Act, matters concerning foreign exchanges and foreign trades shall be governed by the Foreign Exchange Transactions Act. |
| (2) | Notwithstanding the proviso of Article 462-2 (1) of the Commercial Act, a foreign-invested company may pay dividends with its newly issued stocks up to an amount equivalent to its total dividend amount, where a special resolution has been passed under Article 434 of the Commercial Act. |
| (3) | Where a foreign investor makes an investment in kind with the capital goods defined under Article 2 (1) 8 (b), the certificate of completion of the investment in kind for which the Commissioner of the Korea Customs Service verified the implementation of the investment in kind and the type, volume, and price of the objects of the investment in kind, shall be deemed a written report of investigation by an investigator under the Article 299 of the Commercial Act, notwithstanding Article 299 of the same Act. The same shall also apply where he or she makes an investment in kind with the capital goods after he or she has established a company. <Amended on May 20, 2014> |
| (4) | Where a technology evaluation agency prescribed by Presidential Decree has evaluated the price of an industrial property right defined under Article 2 (1) 8 (d), such evaluation shall be deemed appraised by an appraiser publicly certified under Article 299-2 of the Commercial Act. |
| (5) | A national of the Republic of Korea or a Korean corporation or enterprise that intends to conduct a business jointly with a foreign investor who has filed a report to make a foreign investment by the method prescribed in Article 2 (1) 4 (a) (i) may designate the first day of each month as the re-evaluation day and re-evaluate the objects of the relevant investment, as prescribed in the Assets Revaluation Act, notwithstanding Article 4 of the Assets Revaluation Act. <Amended on Jan. 27, 2016; Feb. 4, 2020> |
| (6) | Notwithstanding Article 18 (4) 1 through 4 of the Monopoly Regulation and Fair Trade Act, a second-tier subsidiary of a general holding company may hold stocks of a joint stock corporation with a foreigner, where it meets all of the following requirements: <Newly Inserted on Jan. 10, 2014; Dec. 29, 2020> |
| 1. | Such stock holding shall be a foreign investment meeting the standards referred to in Article 18 (1) 2; |
| 2. | The second-tier subsidiary of the general holding company shall hold at least 50/100 of the total number of stocks issued by such joint stock corporation; |
| 3. | A foreigner shall hold at least 30/100 (the share-holding ratio of the foreigner shall be calculated only for the stocks held at and after the time the joint stock corporation is formed) of the total number of stocks issued by such joint stock corporation; |
| 4. | The second-tier subsidiary of the general holding company shall hold all the outstanding shares issued by such joint stock corporation, except those held by foreigners. |
| (7) | Each second-tier subsidiary of a general holding company that intends to hold stocks of a joint stock corporation under paragraph (6) shall obtain approval from the Foreign Investment Committee. In such cases, the Minister of Trade, Industry and Energy shall submit the relevant case to the Fair Trade Commission for the prior deliberation of the requirements prescribed by Presidential Decree, including the joint stock corporation’s business relevance with the second-tier subsidiary and the second-tier subsidiary’s qualification to become a stakeholder in the joint stock corporation. <Newly Inserted on Jan. 10, 2014> |
| (8) | “General holding company”, “second-tier subsidiary”, and “joint stock corporation” referred to in paragraphs (6) and (7) have the same meanings defined by the Monopoly Regulation and Fair Trade Act. <Newly Inserted on Jan. 10, 2014> |
| (9) | None of the provisions of this Act shall be construed as amending or limiting any terms and conditions of international treaties the Republic of Korea has entered into and promulgated. <Newly Inserted on Jan. 10, 2014> |
[This Article Wholly Amended on Jan. 30, 2009]
[Enforcement Date: Dec. 30, 2021] Article 30
| Article 31 (Delegation of Authority) |
The Minister of Trade, Industry and Energy, the competent Ministers, or the Mayors/Do Governors may, as prescribed by Presidential Decree, delegate or entrust part of his/her authority vested under this Act to the Commissioner of the National Tax Service, the Commissioner of the Korea Customs Service, the president of the Korea Trade-Investment Promotion Agency, the heads of management agencies of foreign investment zones, and the heads of any foreign investment-related agencies prescribed by Presidential Decree. <Amended on Mar. 23, 2013>
[This Article Wholly Amended on Jan. 30, 2009]
CHAPTER VIII PENALTY PROVISIONS
| Article 32 (Penalty Provisions) |
Any person who has transferred foreign currency funds illegally to a foreign country on the occasion of overseas remittance or foreign investment under this Act (including the representative in the case of a company) shall be punished by imprisonment with labor for not less than one year, or by a fine equivalent to at least twice but exceeding ten times the amount of the illegal transfer. In such cases, the foreign currency funds illegally transferred shall be confiscated, and if confiscation is not possible, the corresponding value shall be collected in lieu of such confiscation. <Amended on Jan. 27, 2016>
[This Article Wholly Amended on Jan. 30, 2009]
| Article 33 (Penalty Provisions) |
Any person who fails to file for registration of alternation as prescribed in Article 21 (3) 2 shall be punished by imprisonment with labor for not more than five years, or by a fine not exceeding fifty million won. <Amended on Jan. 27, 2016>
[This Article Wholly Amended on Jan. 30, 2009]
| Article 34 (Penalty Provisions) |
Any person who has submitted false documents with respect to permission or report under this Act shall be punished by imprisonment with labor for not more than three years or by a fine not exceeding 30 million won.
[This Article Wholly Amended on Jan. 30, 2009]
| Article 35 (Penalty Provisions) |
Any of the following persons (including a representative in cases of a company) shall be punished by imprisonment with labor for not more than one year or by a fine not exceeding 10 million won: <Amended on Apr. 5, 2010; Dec. 11, 2012; Jan. 27, 2016; Feb. 4, 2020>
| 1. | A person who acquires stocks, etc. of a corporation running a defense industry company without permission, in violation of Article 6 (1); |
| 2. | A person who uses data received from the heads of relevant administrative agencies, etc. or confidential information he or she has become aware of in the course of performing duties for any purpose other than those prescribed by this Act, or divulges it to any third party, in violation of Article 15-2 (8); |
| 3. | A person who fails to take measures, such as a correction order issued under Article 28 (5). |
[This Article Wholly Amended on Jan. 30, 2009]
| Article 36 (Joint Penalty Provisions) |
If the representative of a corporation, or an agent, employee or worker of a corporation or individual has committed a violation falling under any of Articles 32 through 35 with reference to the business of the corporation or individual, not only shall the violator but also the corporation or individual be punished by a fine under the relevant provision: Provided , That where the corporation or individual has not neglected appropriate attention and supervision with regard to the business concerned in order to prevent such violation, this provision shall not apply.
[This Article Wholly Amended on Dec. 26, 2008]
| Article 37 (Administrative Fines) |
| (1) | Any of the following persons shall be subject to an administrative fine of not more than 10 million won: <Amended on Jan. 27, 2016; Feb. 4, 2020> |
| 1. | A person who acquires existing stocks, etc. under Article 2 (1) 4 (a) (ii) without reporting thereon, in violation of Article 5 (1); |
| 2. | A person who fails to create employment or make an investment within the period prescribed under Article 13 (2) 1 or 2 after concluding a negotiated contract under Article 13 (1) or 13-3 (1); |
| 3. | A person who fails to meet the minimum foreign investment ratio referred to in the main clause of Article 13 (2) or the main clause of Article 13-3 (2) or to maintain the minimum foreign investment ratio for a period prescribed by Presidential Decree (excluding foreign-invested companies in a foreign investment zone designated under Article 18 (1)); |
| 4. | A person who transfers or lends the registration certificate of a foreign-invested company to a third person, in violation of Article 21 (6); |
| 5. | A person who fails to undergo an investigation conducted under Article 28 (2), or refuses, interferes with, or evades such investigation. |
| (2) | Administrative fines referred to in paragraph (1) shall be imposed and collected by the Minister of Trade, Industry and Energy, as prescribed by Presidential Decree. <Amended on Mar. 23, 2013> |
[This Article Wholly Amended on Jan. 30, 2009]
ADDENDA <Act No. 5559, Sep. 16, 1998>
Article 1 (Enforcement Date)
This Act shall enter into force two months after the date of its promulgation.
Article 2 (Application Date)
Article 20 (3) 2 shall apply until December 31, 2003.
Article 3 (Repeal of Other Statutes)
Article 4 (Applicability to Provisions concerning Reduction or Exemption of Taxes)
The reduction or exemption of taxes in accordance with the provisions of this Act shall begin to be applied to the first application for the reduction or exemption of taxes or the first application for the exemption of taxes after this Act enters into force: Provided , That an application for the reduction or exemption of taxes or for the exemption of taxes which had been filed in accordance with the Foreign Investment and Foreign Capital Inducement Act before the enforcement of this Act but had not received a decision on the reduction or exemption of taxes or on the exemption of taxes by the enforcement date of this Act, shall be regarded as having been filed as of the enforcement date of this Act, so that it shall be governed by this Act.
Article 5 (Transitional Measures concerning Receipt of Reports)
| (1) | Cases for which the receipt of report was done, or the approval, permission, report, confirmation, or registration (hereinafter referred to as "approval") was obtained or done in accordance with the previous Foreign Investment and Foreign Capital Inducement Act before the enforcement date of this Act, shall be regarded as cases for which the report has been done or the approval has been obtained. |
| (2) | Cases for which the report had been made or the application for the approval, permission, confirmation, or registration had been filed in accordance with the previous Foreign Investment and Foreign Capital Inducement Act, and the necessary procedures thereupon were being taken at the time this Act enters into force, shall be governed by the previous Foreign Investment and Foreign Capital Inducement Act. |
| (3) | Cases for which the decision on the reduction or exemption of taxes or on the exemption of taxes had been made in accordance with the previous Foreign Investment and Foreign Capital Inducement Act before the enforcement of this Act shall be governed by the provisions of the previous Foreign Investment and Foreign Capital Inducement Act, notwithstanding the provision of Article 3 of this Addenda. |
Article 6 (Transitional Measures concerning Free Export Zone)
The free export zone having already been established in accordance with the Establishment of the Act on Establishment of Free Export Zones at the time this Act enters into force shall be regarded as the foreign investment zone in applying the reduction or exemption of taxes or rents as prescribed by this Act.
Article 7 (Transitional Measures concerning Penalty Provisions)
The application of penalty provisions to violations committed before this Act enters into force shall be governed by the previous Foreign Investment and Foreign Capital Inducement Act.
Article 8 Omitted.
Article 9 (Relationship to Other Statutes and Regulations)
Where the provisions of the previous Foreign Investment and Foreign Capital Inducement Act or the Foreign Capital Inducement Act concerning foreign investment are cited by other statutes and regulations at the time this Act enters into force, and where any provisions corresponding thereto are included in this Act the corresponding provisions of this Act shall be deemed cited in lieu of the previous provisions.
ADDENDA <Act No. 5654, Jan. 21, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force two months after the date of its promulgation.
Articles 2 through 11 Omitted.
ADDENDA <Act No. 5758, Feb. 5, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2000.
Articles 2 through 11 Omitted.
ADDENDA <Act No. 5827, Feb. 8, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force six months after its promulgation.
Articles 2 through 8 Omitted.
ADDENDA <Act No. 5893, Feb. 8, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force six months after its promulgation.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 5911, Feb. 8, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force six months after its promulgation.
Articles 2 through 8 Omitted.
ADDENDA <Act No. 5914, Feb. 8, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force six months after its promulgation.
Articles 2 through 5 Omitted.
ADDENDA <Act No. 5982, May 24, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDA <Act No. 6095, Dec. 31, 1999>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2001.
Articles 2 through 10 Omitted.
ADDENDA <Act No. 6193, Jan. 21, 2000>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2000.
Articles 2 through 7 Omitted.
ADDENDA <Act No. 6317, Dec. 29, 2000>
Article 1 (Enforcement Date)
This Act shall enter into force on February 1, 2001.
Article 2 (Applicable Cases for Report on Foreign Investment)
The report under the amendments to Article 7 (1) 5 shall be applicable to the portion of conversion, acceptance, or exchange of stocks, in terms of the convertible bonds, stock depositary receipts, and others similar to them, which is conducted on and after the enforcement date of this Act.
Article 3 (Transitional Measures on Grievance Settlement Organ)
The grievance settlement organ established in the Foreign Investment Support Center under the previous Article 15 (7) at the time of enforcement of this Act shall be regarded as the grievance settlement organ established in the Korea Trade and Investment Promotion Agency under the amendments to Article 15 (7).
ADDENDA <Act No. 6406, Jan. 29, 2001>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2001.
Articles 2 and 3 Omitted.
ADDENDA <Act No. 6452, Mar. 28, 2001>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2002.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 6460, Apr. 7, 2001>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2001.
Articles 2 through 4 Omitted.
ADDENDA <Act No. 6642, Jan. 26, 2002>
Article 1 (Enforcement Date)
This Act shall enter into force six months after its promulgation.
Articles 2 through 8 Omitted.
ADDENDA <Act No. 6643, Jan. 26, 2002>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2003.
Articles 2 through 17 Omitted.
ADDENDA <Act No. 6842, Dec. 30, 2002>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2003.
Articles 2 through 8 Omitted.
ADDENDA <Act No. 7039, Dec. 31, 2003>
| (1) | (Enforcement Date) This Act shall enter into force on January 1, 2004. |
| (2) | (Applicability to Furnishing of Funds in Cash) The amended provisions of Article 14-2 shall apply, starting with the first report made on a foreign investment after this Act enters into force. |
ADDENDA <Act No. 7281, Dec. 31, 2004>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2005: Provided , That the amended provisions of Article 20 (3) 2 shall enter into force on the date of its promulgation.
Article 2 (Application Deadline)
The amended provisions of Article 20 (3) 2 shall apply until December 31, 2011. <Amended by Act No. 9374, Jan. 30, 2009>
Article 3 (Transitional Measures concerning Industrial Complex Exclusively for Foreign-Invested Enterprises)
Any industrial complex exclusively for foreign-invested enterprises, which is designated in accordance with the provisions of Article 35-3 of the previous Industrial Cluster Development and Factory Establishment Act shall be deemed designated in accordance with the amended provisions of Article 18 (1) of this Act.
Article 4 (Transitional Measures concerning Penalty Provisions)
The application of the penalty provisions to violations committed prior to the enforcement of this Act shall be governed by the previous provisions.
Article 5 Omitted.
ADDENDA <Act No. 7678, Aug. 4, 2005>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 12 Omitted.
ADDENDUM <Act No. 7754, Dec. 23, 2005>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 7849, Feb. 21, 2006>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2006. (Proviso Omitted.)
Articles 2 through 41 Omitted.
ADDENDA <Act No. 7864, Mar. 3, 2006>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation.
Articles 2 through 11 Omitted.
ADDENDA <Act No. 8014, Sep. 27, 2006>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 11 Omitted.
ADDENDA <Act No. 8337, Apr. 6, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 9 Omitted.
ADDENDA <Act No. 8338, Apr. 6, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation.
Articles 2 through 17 Omitted.
ADDENDA <Act No. 8352, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 16 Omitted.
ADDENDA <Act No. 8356, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Articles 2 through 7 Omitted.
ADDENDA <Act No. 8358, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 8368, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Articles 2 through 11 Omitted.
ADDENDA <Act No. 8369, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 16 Omitted.
ADDENDA <Act No. 8370, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 20 Omitted.
ADDENDA <Act No. 8371, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 10 Omitted.
ADDENDA <Act No. 8377, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 16 Omitted.
ADDENDA <Act No. 8380, Apr. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDA <Act No. 8401, Apr. 27, 2007>
| (1) | (Enforcement Date) This Act shall enter into force six months after the date of its promulgation. |
| (2) | (Applicability concerning Report of Foreign Investment by Acquisition of Existing Stocks, etc.) The amended provisions of proviso of Article 6 (1) shall apply beginning with the portion in which existing stocks, etc. are acquired for the first time after this Act enters into force. |
ADDENDA <Act No. 8404, Apr. 27, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 14 Omitted.
ADDENDA <Act No. 8466, May 17, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDA <Act No. 8533, Jul. 19, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
ADDENDA <Act No. 8566, Jul. 27, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 and 3 Omitted.
ADDENDA <Act No. 8819, Dec. 27, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 9 Omitted.
ADDENDA <Act No. 8852, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 7 Omitted.
ADDENDA <Act No. 8974, Mar. 21, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.
Articles 2 through 14 Omitted.
ADDENDA <Act No. 8976, Mar. 21, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 10 Omitted.
ADDENDA <Act No. 9037, Mar. 28, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2009.
Articles 2 through 19 Omitted.
ADDENDA <Act No. 9071, Mar. 28, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2009. (Proviso Omitted.)
Articles 2 through 11 Omitted.
ADDENDUM <Act No. 9239, Dec. 26, 2008>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 9313, Dec. 31, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Articles 2 and 3 Omitted.
ADDENDA <Act No. 9374, Jan. 30, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided , That the amended provisions of Article 2 of the Addenda of the Foreign Investment Promotion Act (Act No. 7281) shall enter into force on the date of promulgation thereof.
Article 2 Omitted.
ADDENDA <Act No. 9401, Jan. 30, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 11 Omitted.
ADDENDA <Act No. 9407, Feb. 3, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force on February 4, 2009.
Articles 2 through 12 Omitted.
ADDENDA <Act No. 9432, Feb. 6, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 7 Omitted.
ADDENDA <Act No. 9774, Jun. 9, 2009>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 19 Omitted.
ADDENDA <Act No. 10232, Apr. 5, 2010>
| (1) | (Enforcement Date) This Act shall enter into force six months after the date of its promulgation. |
| (2) | Deleted. <Dec. 11, 2012> |
| (3) | (Applicability to Cash Support) The amended provisions of Article 14-2 (1) shall apply to the first report on foreign investment made after this Act enters into force. |
ADDENDA <Act No. 10272, Apr. 15, 2010>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 14 Omitted.
ADDENDA <Act No. 10310, May 25, 2010>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 14 Omitted.
ADDENDA <Act No. 10339, Jun. 4, 2010>
Article 1 (Enforcement Date)
This Act shall enter into force one month after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 5 Omitted.
ADDENDA <Act No. 10801, Jun. 15, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 9 Omitted.
ADDENDA <Act No. 10892, Jul. 21, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 10 Omitted.
ADDENDA <Act No. 11020, Aug. 4, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 11 Omitted.
ADDENDA <Act No. 11029, Aug. 4, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation.
Articles 2 and 3 Omitted.
ADDENDA <Act No. 11042, Sep. 15, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2012.
Article 2 Omitted.
ADDENDA <Act No. 11232, Jan. 26, 2012>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 12 Omitted.
ADDENDA <Act No. 11535, Dec. 11, 2012>
Article 1 (Enforcement Date)
This Act shall enter into force on December 31, 2012: Provided , That the amended provisions of Articles 13, 15-2 and 27 (2) shall enter into force six months after the date of promulgation thereof.
Article 2 (Applicability to Use, Profiting from, Lease, or Purchase of State or Public Property,
The amended provisions of Article 13 (2) shall begin to apply to a foreign-invested company that first uses, profits from, leases, or purchases land, etc. after the date this Act enters into force.
ADDENDA <Act No. 11690, Mar. 23, 2013>
Article 1 (Enforcement Date)
| (1) | This Act shall enter into force on the date of its promulgation. |
| (2) | Omitted. |
Articles 2 through 7 Omitted.
ADDENDUM <Act No. 12225, Jan. 10, 2014>
This Act shall enter into force two months after the date of its promulgation.
ADDENDA <Act No. 12592, May 20, 2014>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDA <Act No. 12844, Nov. 19, 2014>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided , That the amended provisions of a statute, among statutes amended under Article 6 of these Addenda, which was promulgated before this Act enters into force but the enforcement date of which has yet to arrive shall enter into force on the date the relevant statute enters into force.
Articles 2 through 7 Omitted.
ADDENDA <Act No. 13082, Jan. 28, 2015>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation.
Articles 2 and 3 Omitted.
ADDENDA <Act No. 13426, Jul. 24, 2015>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 39 Omitted.
ADDENDA <Act No. 13854, Jan. 27, 2016>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation.
Article 2 (Applicability to Registration of Alteration Filed by Foreign-Invested Companies)
The amended Article 21 (3) 2 shall also apply where customs duties, etc. are exempted under Article 121-3 of the Restriction of Special Taxation Act before this Act enters into force, but such customs duties, etc. are collected under Article 121-5 (2) 2 of the same Act after this Act enters into force.
Article 3 (Transitional Measures concerning Follow-Up Management of Foreign Investment)
Notwithstanding the amended Article 21 (4), the former provisions shall apply to foreign investors or foreign-invested companies which fall under the former provisions of the subparagraphs of Article 21 (3) before this Act enters into force.
Article 4 (Transitional Measures Following Abolishment of Reporting on Licensing Agreements)
The Restriction of Special Taxation Act shall apply to the tax reduction or exemption for foreign engineers who provide labor in the Republic of Korea under a licensing agreement (applicable only to where the provision of labor starts on or before December 31, 2014) reported under the former Article 25 before this Act enters into force.
Article 5 (Transitional Measures concerning Penalty Provisions)
The former penalty provisions shall apply to violations committed before this Act enters into force.
In the amended subparagraph 9 (d) of attached Table 1, “Article 15 of the Housing Act” shall be construed as “Article 16 of the Housing Act” until August 11, 2016.
Article 7 Omitted.
ADDENDA <Act No. 14839, Jul. 26, 2017>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided , That the amended provisions of a statute, among statutes amended under Article 6 of these Addenda, which was promulgated before this Act enters into force but the enforcement date of which has yet to arrive shall enter into force on the date the relevant statute enters into force.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 16101, Dec. 31, 2018>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2019. (Proviso Omitted.)
Articles 2 through 11 Omitted.
ADDENDUM <Act No. 16131, Dec. 31, 2018>
This Act shall enter into force three months after the date of its promulgation.
ADDENDUM <Act No. 16479, Aug. 20, 2019>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 16859, Dec. 31, 2019>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 10 Omitted.
ADDENDA <Act No. 16944, Feb. 4, 2020>
Article 1 (Enforcement Date)
This Act shall enter into force six months after the date of its promulgation: Provided , That the amended provisions of Articles 9 and 27 (2) shall enter into force on the date of promulgation thereof.
Article 2 (Applicability to Using, Profiting from, Leasing, and Purchasing State or Public Property)
The amended provisions of Articles 13, and 13-2 through 13-4 shall begin to apply to a foreign-invested company, etc. which first use, profit from, lease, or purchase land, etc. after this Act enters into force.
Article 3 (Transitional Measures concerning Penalty Provisions)
In applying penalty provisions to violations committed before this Act enters into force, the previous provisions shall apply.
ADDENDA <Act No. 17653, Dec. 22, 2020>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2021. (Proviso Omitted.)
Articles 2 through 14 Omitted.
ADDENDUM <Act No. 17729, Dec. 22, 2020>
This Act shall enter into force six months after the date of its promulgation.
ADDENDA <Act No. 17799, Dec. 29, 2020>
Article 1 (Enforcement Date)
This Act shall enter into force one year after the date of its promulgation. (Proviso Omitted.)
Articles 2 through 26 Omitted.
ADDENDA <Act No. 17883, Jan. 5, 2021>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation.
Articles 2 through 9 Omitted.
ENFORCEMENT DECREE OF THE FOREIGN INVESTMENT PROMOTION ACT
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CHAPTER I GENERAL PROVISIONS
| Article 1 (Purpose) |
The purpose of this Decree is to prescribe matters mandated by the Foreign Investment Promotion Act and matters necessary for the enforcement thereof.
[This Article Wholly Amended on Jul. 30, 2009]
| Article 2 (Definitions of foreign investment) |
| (1) | "International economic cooperative organization prescribed by Presidential Decree" in Article 2 (1) 1 of the Foreign Investment Promotion Act (hereinafter referred to as the "Act") means: |
| 1. | An agency that conducts foreign economic cooperation affairs on behalf of a foreign government; |
| 2. | An international organization that deals with affairs concerning development finance, such as the International Bank for Reconstruction and Development, the International Financial Corporation, and the Asia Development Bank; |
| 3. | An international organization that deals with affairs concerning foreign investment, whether for itself or others. |
| (2) | "Foreign investment" under Article 2 (1) 4 (a) of the Act refers to any of the following and the investment amount is at least 100 million won; provided, where a business fails to meet the requirements of the main clause of this paragraph due to partial transfer of stocks or shares (hereinafter referred to as "stocks, etc.") or capital reduction, etc. after it has been registered as a foreign-invested company under Article 21 (1) and (2) of the Act, it shall be also deemed a foreign investment: <Amended on Oct. 5, 2010; Jul. 28, 2016; Aug. 5, 2020> |
| 1. | Where a foreigner owns at least 10/100 of the total number of voting stocks issued by, or of the total equity investment of, a Korean corporation or enterprise (in cases of a corporation, including a corporation in the process of incorporation; hereinafter the same shall apply); |
| 2. | Where a foreigner who owns stocks, etc. of a Korean corporation or enterprise dispatches or appoints an executive officer (referring to a director, a representative director, a managing general partner, an auditor, or a person in a similar position, who has the authority to participate in decision-making for important management matters; hereinafter the same shall apply) to or at such corporation or company. |
| (3) | "Investment amount" in the main clause, with the exception of the subparagraphs, of paragraph (2) means the acquisition price of stocks, etc. (including where a foreign investor owns stocks as a foreign-invested company capitalizes the earned surplus reserve under Article 458 of the Commercial Act, pursuant to Article 461 of that Act) and, where two or more foreigners make a joint investment, it means an amount invested by each person. In such cases, if a decrease in the amount of stocks, etc. held by a foreign investor is made due to capital reduction without any refund of the foreign-invested company, the investment amount at the time of acquisition of stocks, etc. shall be deemed to remain unchanged. <Added on Oct. 5, 2010; Dec. 30, 2015> |
| (4) | "Company that has a capital investment relationship prescribed by Presidential Decree" in Article 2 (1) 4 (b) (ii) of the Act means: <Amended on Oct. 5, 2010> |
| 1. | A company that holds at least 50/100 of the total number of issued stocks, or of the total equity investment of, its overseas parent company; |
| 2. | A foreign-invested company that holds at least 50/100 of the total number of issued stocks, or of the total equity investment of which, is held by its overseas parent company, and which is either of the following: |
| (a) | Company that holds at least 10/100 of the total number of issued stocks, or of the total equity investment of, its overseas parent company; |
| (b) | Company, at least 50/100 of the total number of issued stocks, or of the total equity investment of which, is held by its overseas parent company or a company referred to in subparagraph 1. |
| (5) | "Company that has a capital investment relationship prescribed by Presidential Decree" in Article 2 (1) 4 (b) (iv) of the Act means a company, at least 50/100 of the total number of issued stocks, or of the total equity investment of which, is held by a foreign investor who holds at least 50/100 of the total number of issued stocks, or of the total equity investment of a foreign-invested company. <Amended on Oct. 5, 2010> |
| (6) | "Standards prescribed by Presidential Decree" in Article 2 (1) 4 (c) of the Act means where a foreigner contributes at least 50 million won, accounting for at least 10/100 of the total amount of contributions to a nonprofit corporation that meets all of the following requirements: <Amended on Oct. 5, 2010; Jun. 11, 2013; Jul. 28, 2016; Oct. 1, 2025> |
| 1. | It shall have an independent research facility; |
| 2. | It shall meet either of the following requirements: |
| (a) | At least five regular workers defined under Article 11 of the Labor Standards Act (hereinafter referred to as "regular worker") with a bachelor's degrees in the fields of science and technology and at least three years’ research career, or with a master's or higher degree in the fields of science and technology; |
| (b) | Engaging in research and development activities in the fields of natural science or engineering under the Korean Standard Industrial Classification prepared and publicly notified by the Minister of Data and Statistics under Article 22 of the Statistics Act (hereinafter referred to as "Korean Standard Industrial Classification"). |
| (7) | "Purposes prescribed by Presidential Decree, such as the creation or extension of its factory facilities" in Article 2 (1) 4 (d) of the Act means any of the following: <Added on Aug. 5, 2020> |
| 1. | Factory facilities (referring to a workplace where the business operator operates any business, other than the manufacturing business under the Korea Standard Industrial Classification; hereinafter the same shall apply) or research facilities are newly established or expanded; |
| 2. | Where the relevant company purchases capital goods or research equipment and materials necessary to perform its business. |
| (8) | "Standards prescribed by Presidential Decree" in Article 2 (1) 4 (d) of the Act means where a foreigner contributes at least 50 million won which accounts for at least 10/100 of the total amount of contributions to a nonprofit corporation that is either of the following: <Amended on Oct. 5, 2010; Jul. 28, 2016; Aug. 5, 2020> |
| 1. | A nonprofit corporation that has been established with the purposes of promotion, etc. of science, art, medical services, or education, and continuously performs projects for developing experts in the relevant fields and for expanding international exchanges; |
| 2. | Local headquarters of an international organization performing international cooperation projects between civilians or governments. |
| (9) | "Establishments prescribed by Presidential Decree" in Article 2 (1) 7 of the Act means: <Amended on Oct. 5, 2010; Mar. 23, 2013; Aug. 5, 2020; Oct. 1, 2025> |
| 1. | A foreigners' school established under Article 60-2 of the Elementary and Secondary Education Act; |
| 2. | A general hospital, hospital, dental hospital, oriental medical hospital, intermediate care hospital, medical clinic, dental clinic, oriental medical clinic, and midwifery clinic referred to in Article 3 (2) of the Medical Service Act; |
| 3. | A pharmacy defined under subparagraph 3 of Article 2 of the Pharmaceutical Affairs Act; |
| 4. | Detached housing and multi-family housing referred to in subparagraphs 1 and 2 of Appendix 1 of the Enforcement Decree of the Building Act; |
| 5. | Other facilities determined and publicly notified by the Minister of Trade, Industry and Resources following deliberation by the Foreign Investment Committee (hereinafter referred to as the "Foreign Investment Committee") established under Article 27 of the Act, such as a business incubation center for foreign investors. |
| (10) | "Intellectual property rights prescribed by Presidential Decree" in Article 2 (1) 8 (d) of the Act means any rights used in the industrial activities among copyrights registered under the Copyright Act and the layout-design rights defined under subparagraph 5 of Article 2 of the Act on the Layout-Designs of Semiconductor Integrated Circuits. <Amended on Oct. 5, 2010; Aug. 5, 2020> |
| (11) | "Stocks prescribed by Presidential Decree" in Article 2 (1) 8 (g) of the Act means the following: <Amended on Oct. 5, 2010; Aug. 5, 2020> |
| 1. | Stocks of foreign corporations listed on foreign securities markets; |
| 2. | Stocks owned by foreigners under the Act or the Foreign Exchange Transactions Act. |
| (12) | "Means of domestic payment prescribed by Presidential Decree" in Article 2 (1) 8 (i) of the Act means proceeds from the sale of stocks, etc. and real estate of a Korean corporation or a company run by a national of the Republic of Korea, held by a foreigner pursuant to the Act and the Foreign Exchange Transactions Act. <Amended on Oct. 5, 2010; Aug. 5, 2020> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 3 (Definition of individual who holds permanent residency in foreign country) |
"Persons prescribed by Presidential Decree" in Article 2 (2) of the Act means the following persons:
| 1. | A person who has acquired permanent residency in the country where he or she resides; |
| 2. | A person who has acquired a resident permit for four or more years in a country without the permanent residency system; |
| 3. | A person who has resided for four or more years and acquired a resident permit for one or more year in a country which grants a resident permit for less than four years only without the permanent residency system. |
[This Article Wholly Amended on Jul. 28, 2016]
| Article 4 (Remittance of proceeds to foreign countries) |
| (1) | Where a foreign investor or a provider of the loan prescribed in Article 2 (1) 4 (b) of the Act intends to remit funds to a foreign country pursuant to Article 3 (1) of the Act, the head of a foreign exchange bank prescribed in the Foreign Exchange Transactions Act (hereinafter referred to as "head of a foreign exchange bank") shall verify the legitimacy of the remittance to a foreign country. <Amended on Jan. 5, 2021> |
| (2) | The head of a foreign exchange bank may request cooperation, such as verifying information on the relevant foreign investment, from the Minister of Trade, Industry and Resources, the president of the Korea Trade-Investment Promotion Agency established under the Korea Trade-Investment Promotion Agency Act, or the head of a foreign exchange bank entrusted with business affairs under the subparagraphs of Article 40 (2) (hereinafter referred to as "head of an entrusted institution"), if necessary to verify the legitimacy of the remittance to a foreign country under paragraph (1). <Amended on Aug. 27, 2024; Oct. 1, 2025> |
| (3) | Upon completion of the remittance to a foreign country prescribed in paragraph (1), the head of a foreign exchange bank shall notify such fact to the Minister of Trade, Industry and Resources or the head of an entrusted institution without delay. <Amended on Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 28, 2016]
| Article 5 (Categories of businesses with restricted foreign investment) |
| (1) | The types of business in which foreign investment is restricted pursuant to Article 4 (3) of the Act and the details of restrictions shall be as follows: <Amended on Mar. 23, 2013; Oct. 15, 2014; Jul. 28, 2016; Aug. 5, 2020; Jun. 22, 2021; Aug. 27, 2024; Oct. 8, 2024; Oct. 1, 2025> |
| 1. | Each of the following publicly notified by the Minister of Trade, Industry and Resources after consultation with the competent Minister, in consideration of the scope of a reservation concerning domestic direct investment by nonresidents set out in Annex 1 (Reservations of the Code of Liberalization of Capital Movements) to the invitation agreements to join the Convention on the Organization for Economic Cooperation and Development for the Republic of Korea, in the Convention on the Organization for Economic Cooperation and Development, and details of a reservation set out in the Annex to the Convention on the Organization for Economic Cooperation and Development concerning bilateral or multilateral investments: |
| (a) | A type of business (hereinafter referred to as "restricted type of business") in which foreign investment is not permitted or is partially permitted; |
| (b) | The ratio of total foreign investment permitted (hereinafter referred to as "ratio of permissible foreign investment") for each type of business in which foreign investment is partially permitted under item (a); |
| (c) | Qualifications of foreign investors and the parties to domestic joint investment; |
| (d) | Other standards for permission, such as the timing of permission for foreign investment; |
| 2. | Matters determined by the Minister of Trade, Industry and Resources under Article 5-2 (3) where any of the following foreign investments falling under all of the following cases causes an impediment to the maintenance of national security under Article 4 (2) 1 of the Act (hereinafter referred to as "national security risk"): |
| (a) | Where a foreigner intends to acquire |
| (b) | Any of the following cases where: |
| (i) | Manufacturing defense materials defined under subparagraph 7 of Article 3 of the Defense Acquisition Program Act (hereinafter referred to as "defense materials") may be hindered; |
| (ii) | Goods, etc. or technologies subject to permission or approval for exportation under Article 19-2 of the Foreign Trade Act are likely to be used for military purposes; |
| (iii) | Contents of a contract, etc. classified as a State secret under Article 4 (1) 2 of the National Intelligence Service Act (hereinafter referred to as "State secret") are likely to be disclosed; |
| (iv) | International efforts of the United Nations, etc. to maintain international peace and security may be substantially and critically hindered; |
| (v) | The divulgence of the national core technology defined in subparagraph 2 of Article 2 of the Act on Prevention of Divulgence and Protection of Industrial Technology is highly likely; |
| (iv) | A national high-tech strategic technology defined in subparagraph 1 of Article 2 of the Act on Special Measures for Strengthening and Protection of Competitiveness of National High-Tech Strategic Industry is highly likely to be leaked; |
| (2) | Notwithstanding paragraph (1) 1, a foreigner may make an investment in a company, of which turnover ratio of a restricted type of business, does not exceed 1/100 of the total turnover, with no restriction prescribed in paragraph (1) 1. |
| (3) | When the turnover ratio of a restricted type of business of a company falling under paragraph (2) has exceeded 1/100 of the total turnover of the company after a foreigner acquired stocks, etc. of the company, the stocks, etc. acquired in excess of the ratio of permissible foreign investment shall be transferred to a national of the Republic of Korea or a Korean corporation within 6 months from the settlement date of final accounts of the business year in which such ratio is exceeded; provided, the period of transfer may be extended up to 6 months with the approval of the Minister of Trade, Industry and Resources in unavoidable circumstances. <Amended on Mar. 23, 2013; Oct. 1, 2025> |
| (4) | No foreigner shall make an investment in any company concurrently running both a category of business in which foreign investment is not permitted and a category of business in which foreign investment is partially permitted under paragraph (1) 1 (a), and where intending to make an investment in any company running at least two categories of business in which foreign investment is partially permitted under paragraph (1) 1 (a), he or she is prohibited from making an investment in the company in excess of the ratio of foreign investment in the category of business in which the ratio of permissible foreign investment is lowest. |
| (5) | Deleted. <Aug. 27, 2024> |
| (6) | Deleted. <Aug. 27, 2024> |
| (7) | Deleted. <Aug. 27, 2024> |
| (8) | Deleted. <Aug. 27, 2024> |
| (9) | Deleted. <Aug. 27, 2024> |
| (10) | Deleted. <Aug. 27, 2024> |
| (11) | Where any details of restrictions on foreign investment publicly announced by the Minister of Trade, Industry and Resources in the preceding year under Article 4 (4) of the Act are modified or added, the head of a relevant administrative agency shall compile such modifications or additions as at January 1 and notify the Minister of Trade, Industry and Resources thereof by the end of January, and the Minister of Trade, Industry and Resources shall compile and publicly announce them by the last day of February each year. <Amended on Mar. 23, 2013; Aug. 5, 2020; Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 5-2 (Determination on whether foreign investment constitutes national security risk) |
| (1) | Before filing a report on foreign investment under Article 5 (1) through (3) of the Act, a foreigner may request the competent Minister or the Minister of Trade, Industry and Resources to verify whether the relevant foreign investment falls under all items of Article 5 (1) 2 by satisfying the matters determined and publicly notified by the Minister of Trade, Industry and Resources. In such cases, upon receipt of a request for verification, the competent Minister shall, without delay, request the Minister of Trade, Industry and Resources to verify whether the relevant foreign investment falls under the items of Article 5 (1) 2. <Amended on Oct. 1, 2025> |
| (2) | If the Minister of Trade, Industry and Resources receives a request for verification under paragraph (1) (including where the Minister of Trade, Industry and Resources receives a request for verification from the competent Minister under the latter part of that paragraph), he or she shall notify the relevant foreigner of whether the relevant foreign investment falls under all items of Article 5 (1) 2 within 30 days from the date he or she requests verification to the competent Minister or the Minister of Trade, Industry and Resources; provided, if the Minister of Trade, Industry and Resources requests the foreigner to complement data for verification, the period required to complement the relevant data shall not be included in the period prescribed in the main clause. <Amended on Oct. 1, 2025> |
| (3) | In any of the following cases, the Minister of Trade, Industry and Resources shall determine whether it constitutes a national security risk, subject to deliberation by the Foreign Investment Committee; in such cases, he or she shall undergo prior review by the expert committee under Article 34-2 (1) (hereinafter referred to as the "expert committee") before deliberation by the Foreign Investment Committee: <Amended on Oct. 1, 2025> |
| 1. | Where a foreigner reports that the relevant foreign investment falls under all items of Article 5 (1) 2; |
| 2. | Any of the following cases, other than those referred to in subparagraph 1: |
| (a) | Where the competent Minister or the Director of the National Intelligence Service makes a request to examine whether it constitutes a national security risk; |
| (b) | Where the Minister of Trade, Industry and Resources deems it necessary. |
| (4) | The expert committee shall report the results thereof to the Foreign Investment Committee within 90 days from the date of receipt of a request for prior review without delay under the latter part, with the exception of the subparagraphs, of paragraph (3); provided, in unavoidable circumstances, the period may be extended only once by up to 30 days. |
| (5) | The Minister of Trade, Industry and Resources shall determine whether the relevant foreign investment constitutes a national security risk within 45 days from the date on which the results of the preliminary examination are reported under paragraph (4) following deliberation by the Foreign Investment Committee. In such cases, if the Minister of Trade, Industry and Resources deems it necessary, he or she may determine to permit foreign investment following deliberation by the Foreign Investment Committee, attaching conditions, such as separate sale of a particular business part or compliance with security maintenance, etc. <Amended on Oct. 1, 2025> |
| (6) | Upon making a determination under paragraph (5), the Minister of Trade, Industry and Resources shall, without delay, give notice to the relevant foreigner that he or she disallows or permits the relevant foreigner to acquire stocks, etc., specifying the following matters: <Amended on Oct. 1, 2025> |
| 1. | Whether such foreign investment constitutes a threat to national security; |
| 2. | Grounds for such determination; |
| 3. | Details of conditions (only applicable where conditions are attached pursuant to the latter part of paragraph (5)). |
| (7) | If the Minister of Trade, Industry and Resources has made a determination under the former part of paragraph (5) that a foreign investment constitutes a threat to national security, the relevant foreigner who has already acquired stocks, etc. of companies with the foreign investment shall transfer such stocks, etc. to a national of the Republic of Korea, a Korean Corporation, or a foreigner who poses no threat to national security (hereinafter referred to as "Korean national, etc.") within six months from the date of such determination; where the Minister has made a determination on conditional approval for investment pursuant to the latter part of paragraph (5), the relevant foreigner shall transfer such stocks, etc. to a Korean national, etc. within six month from the date the Minister becomes aware of a violation of the relevant conditions; provided, the period of such transfer may be extended up to one year with the approval of the Minister of Trade, Industry and Resources in inevitable circumstances. <Amended on Oct. 1, 2025> |
| (8) | If 3 years have elapsed from the date on which the Minister of Trade, Industry and Resources gives the following notification, the Minister of Trade, Industry and Resources may not deliberate on or determine whether the foreign investment constitutes a national security risk under paragraph (3); provided, this shall not apply where the Minister of Trade, Industry and Resources deems it necessary to conduct deliberation or make a determination again under paragraph (3) due to significant changes in circumstances after the following notification is made: <Amended on Oct. 1, 2025> |
| 1. | Where it is notified pursuant to paragraph (2) that the relevant foreign investment does not fall under any item of Article 5 (1) 2; |
| 2. | Where it is notified that the relevant foreigner is permitted to acquire stocks, etc. pursuant to paragraph (6). |
| (9) | If the Minister of Trade, Industry and Resources deems it necessary for verification under the main clause of paragraph (2) and deliberation and determination under paragraph (3), he or she may request the heads of relevant administrative agencies and the Director of the National Intelligence Service to report or submit the details or data investigated in connection with whether a foreign investment constitutes a national security risk, and may request the President of the Korea Trade-Investment Promotion Agency and the heads of relevant public institutions to verify facts necessary for determining whether a foreign investment constitutes a national security risk. <Amended on Oct. 1, 2025> |
| (10) | If a foreign investment is approved following deliberation under other statutes and regulations, the Minister of Trade, Industry and Resources may omit the procedures for deliberation and determination under paragraph (3) [limited to cases falling under Article 5 (1) 2 (b) (v) or (vi)]. <Amended on Oct. 1, 2025> |
| (11) | Except as provided in paragraphs (1) through (10), details necessary for the procedures, methods, etc. for deliberation and determination on whether a foreign investment constitutes a national security risk under paragraph (3) shall be determined by the Minister of Trade, Industry and Resources. <Amended on Oct. 1, 2025> |
[This Article Added on Aug. 27, 2024]
[(Previous) Article 5-2 moved to Article 5-3 <Aug. 27, 2024>]
| Article 5-3 (Request for data necessary for formulation of policy measures to stimulate foreign investment) |
"The heads of relevant financial institutions prescribed by Presidential Decree" in Article 4-2 (5) of the Act means the heads of financial institutions (limited to requests for data constituting the details determined by Minister of Trade, Industry and Resources in prior consultation with the Minister of Economy and Finance or the Chairperson of the Financial Services Commission) determined by the Governor of the Bank of Korea (limited to requests for data on the current status of receipt of remuneration for supply of technology by kind) and the Minister of Trade, Industry and Resources after consultation with the Minister of Economy and Finance or the Chairperson of the Financial Services Commission. <Amended on Oct. 5, 2010; Mar. 23, 2013; Oct. 1, 2025>
[This Article Wholly Amended on Jul. 30, 2009]
[Moved from Article 5-2 <Aug. 27, 2024>]
CHAPTER II PROCEDURES FOR FOREIGN INVESTMENT
| Article 6 (Reporting on foreign investment) |
| (1) | "Specially related persons prescribed by Presidential Decree" in Article 5 (1) and the former part of Article 6 (1) of the Act means any of the following persons: |
| 1. | Spouse and lineal ascendants and descendants of the relevant foreigner (including lineal ascendants and descendants of the spouse of the relevant foreigner); |
| 2. | A foreign corporation where the relevant foreigner and persons in such relationship as prescribed in subparagraph 1 or 3 together hold at least 50/100 of the total number of issued stocks or the total equity investment, or a foreign corporation virtually controlled by the relevant foreigner and said persons; |
| 3. | Employees of the relevant foreigner and persons prescribed in subparagraph 2 or 4 (referring to executive officers in the case of a corporation; in the case of an individual, they shall refer to trade employees, other employed persons through an employment contract, or persons who maintain their livelihood by means of money or property of the individual); |
| 4. | A foreign corporation where such a corporation prescribed in subparagraph 2, the relevant foreigner, and persons prescribed in subparagraphs 1 and 3 together hold at least 50/100 of the total number of issued stocks or the total equity investment. |
| (2) | Where a report on modification filed under Article 5 (3) of the Act contains matters concerning early redemption of loans, the Minister of Trade, Industry and Resources shall, without delay, notify the details of such report to the Commissioner of the National Tax Service, the Commissioner of the Korea Customs Service, the Special Metropolitan City Mayor, Metropolitan City Mayors, the Special Self-Governing City Mayor, |
[This Article Wholly Amended on Jul. 28, 2016]
| Article 7 (Permission of foreign investment) |
| (1) | "Defense industry company prescribed by Presidential Decree" in Article 6 (1) of the Act means a defense industry company defined under subparagraph 9 of Article 3 of the Defense Acquisition Program Act. |
| (2) | The processing period for determining whether to grant permission pursuant to Article 6 (2) of the Act shall be 15 days from the date of receiving an application for permission; provided, such processing period may be extended by up to 15 days only on one occasion in inevitable circumstances. |
| (3) | If the Minister of Trade, Industry and Resources deems that an application for permission for foreign investment filed under Article 6 (1) of the Act needs supplementing or correcting, he or she may require the relevant applicant to supplement or correct the application within a prescribed period for such supplement or correction. In such cases, the period spent for supplementing or correcting any information on the application shall be disregarded for the purpose of calculating the processing period under paragraph (2). <Amended on Oct. 1, 2025> |
| (4) | The Minister of Trade, Industry and Resources shall request the Minister of National Defense to consult on an application for permission for foreign investment under Article 6 (1) of the Act pursuant to paragraph (3) of that Article, and the Minister of National Defense in receipt of such request for consultation shall present his or her opinions on the application to the Minister of Trade, Industry and Resources within 10 days of receipt of such request. <Amended on Oct. 1, 2025> |
| (5) | Where the Minister of National Defense in receipt of the request pursuant to paragraph (4) deems that defense materials produced by a defense industry company applied for permission are replaceable by products of other domestic companies or that granting permission will not significantly affect national security, he or she shall consent to granting of such permission. |
| (6) | In presenting his or her opinions under paragraph (4), the Minister of National Defense may request that the Minister of Trade, Industry and Resources grant permission on either of the following conditions: <Amended on Oct. 1, 2025> |
| 1. | Conditions necessary for continuous production of the relevant defense materials and for the maintenance of security; |
| 2. | The condition of dividing and selling defense industry facilities defined under subparagraph 11 of Article 3 of the Defense Acquisition Program Act (hereinafter referred to as "defense industry facilities") to a national of the Republic of Korea or a Korean corporation. |
| (7) | Where permission is granted on the condition prescribed in paragraph (6) 2, a foreigner who has acquired the stocks, etc. before the sale of the defense industry facilities completes shall not participate in the management of the relevant defense industry company. <Amended on Aug. 5, 2020> |
| (8) | Pursuant to Article 6 (6) of the Act, the Minister of Trade, Industry and Resources shall order a person who has acquired stocks, etc. in violation of Article 6 (1) or (4) of the Act to transfer such stocks, etc. to a national of the Republic of Korea or a Korean corporation within 1 month from the date he or she becomes aware of the violation. In such cases, the period for transfer shall be determined by the Minister of Trade, Industry and Resources within 6 months and such period may be extended by up to 6 months where it is acknowledged that inevitable circumstances exist. <Amended on Aug. 5, 2020; Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 28, 2016]
| Article 8 Deleted. <Jul. 28, 2016> |
CHAPTER III MEASURES FOR SUPPORTING FOREIGN INVESTMENT
| Article 9 Deleted. <May 24, 1999> |
| Article 10 Deleted. <May 24, 1999> |
| Article 11 Deleted. <May 24, 1999> |
| Article 12 Deleted. <May 24, 1999> |
| Article 13 Deleted. <May 24, 1999> |
| Article 14 Deleted. <May 24, 1999> |
| Article 15 Deleted. <May 24, 1999> |
| Article 16 Deleted. <May 24, 1999> |
| Article 17 Deleted. <May 24, 1999> |
| Article 18 Deleted. <May 24, 1999> |
| Article 19 (Lease of state or public property) |
| (1) | "Companies meeting the minimum foreign investment ratio prescribed by Presidential Decree" in the main clause of Article 13 (2) of the Act means any foreign-invested company, at least 30/100 of the total number of voting stocks or total equity investment of which, is owned by a foreign investor. For the purpose of calculating the minimum foreign investment ratios, the stockholding ratio computed by the calculation methods provided for in Article 116-2 (11) and (12) of the Enforcement Decree of the Act on Restriction on Special Cases concerning Taxation shall not be included in the case of a foreign corporation, the stocks or equity investment of which is directly or indirectly owned by a national of the Republic of Korea (excluding those falling under Article 3) or a Korean corporation. <Added on Jun. 11, 2013; Jul. 28, 2016> |
| (2) | "Period prescribed by Presidential Decree" in the main clause of Article 13 (2) of the Act means five years from the date of conclusion of a negotiated contract under Article 13 (1) of the Act. <Added on Jun. 11, 2013> |
| (3) | "Number of regular workers prescribed by Presidential Decree" in Article 13 (2) 1 of the Act means the number of regular workers referred to in Article 20-2 (4) and Appendix 2, and "investment amount prescribed by Presidential Decree" in Article 13 (2) 2 of the Act means the amount of foreign investment provided for in Article 25 (1). <Amended on Jul. 28, 2016; Aug. 5, 2020> |
| (4) | The rents for land, etc. under Article 13 (5) of the Act shall be the amount computed by multiplying the value of such land, etc. by the rate of at least 10/1000; provided, the rent rates for land, etc. in the area under Article 18 (1) 1 of the Act, designated as a foreign investment zone under the former part of that paragraph, shall be as follows: <Amended on Mar. 23, 2013; Jun. 11, 2013; Oct.1, 2025> |
| 1. | If the relevant land, etc. is State property, the rates determined by the Minister of Trade, Industry and Resources after consulting the Minister of Economy and Finance; |
| 2. | If the relevant land, etc. is public property, the rates determined by the Minister of Trade, Industry and Resources after consulting the head of the local government that is the owner of such land, etc. |
| (5) | Deleted. <Aug. 5, 2020> |
| (6) | "Foreign-invested company that runs a business prescribed by Presidential Decree" in the provisions, with the exception of the subparagraphs, of Article 13-2 (1) of the Act means any company that builds a new factory facility to run any of the following businesses: <Amended on Mar. 23, 2013; Jun. 11, 2013; Oct. 15, 2014; Jul. 28, 2016; Aug. 5, 2020; Jul. 18, 2023; Oct. 1, 2025> |
| 1. | Any of the following businesses that make a substantial contribution to the national economy, such as employment growth: |
| (a) | A business run by a foreign-invested company in any of the zones prescribed in subparagraphs 2 through 4 of Article 18 (1) the Act, designated as a foreign investment zone under the former part, with the exception of the subparagraphs, of that paragraph; |
| (b) | A business granted tax reductions or exemptions pursuant to Article 121-2 (1) 1 of the Act on Restriction on Special Cases concerning Taxation; |
| (c) | A business in which a foreign investment of at least five million U.S. dollars has been made, and which intends to be engaged in manufacturing (referring to the manufacturing business under the Korean Standard Industrial Classification; hereinafter the same shall apply); |
| (d) | A business which meets all of the following conditions: |
| (i) | The amount of foreign investment shall be at least 2.5 million U.S. dollars; |
| (ii) | The number of regular workers shall be 70 or more; |
| (iii) | It shall run a business provided for in any of subparagraph 1 through 3 of Article 25 (1) or a facility referred to in subparagraph 4 of that paragraph; |
| 2. | A business that makes a substantial contribution to the expansion of social overhead capital, industrial restructuring, financial independence of local governments, etc., which is determined by the Minister of Trade, Industry and Resources following deliberation by the Foreign Investment Committee. |
| (7) | "Repatriating enterprise in a non-Seoul metropolitan area that runs a business prescribed by Presidential Decree" in the provision, with the exception of the subparagraphs, of Article 13-2 (1) of the Act means repatriating enterprises running any of the following business: <Added on Jun. 22, 2021; Oct. 1, 2025> |
| 1. | Any of the following businesses that make a substantial contribution to the national economy, such as employment growth: |
| (a) | A business whose amount of investment related to repatriation (hereinafter referred to as "amount of investment for repatriation") calculated by the method determined and publicly notified by the Minister of Trade, Industry and Resources, including the amount of purchase of land and investment in facilities, is at least 1 billion won: |
| (i) | A product or service that utilizes advanced technologies under Article 5 (1) of the Industrial Development Act or a business producing advanced products under that paragraph (limited to those recognized as advanced technologies or advanced products, as determined and publicly notified by the Minister of Trade, Industry and Resources); |
| (ii) | A business referred to in Article 121-2 (1) 1 of the Act on Restriction on Special Cases concerning Taxation; |
| (b) | A manufacturing business with an amount of repatriation investment of at least five billion won; |
| (c) | A business which meets all the following requirements: |
| (i) | The amount of repatriation investment shall be at least 2.5 billion won; |
| (ii) | The number of regular workers in workplaces newly established or expanded in Korea shall be 70 or more; |
| (iii) | It shall operate any of the following business or facilities: |
| 2. | A business that makes a substantial contribution to the expansion of social overhead capital, industrial restructuring, financial independence of local governments, etc., which is determined by the Minister of Trade, Industry and Resources, subject to deliberation by the Committee for Assisting Repatriating Enterprises established under Article 6 of the Act on Assistance to Korean Offshore Enterprises in Repatriation. |
| (8) | The reduction or exemption rate of rents for State-owned land, etc. under Article 13-2 (1) of the Act shall be determined by the head of the central government agency having the jurisdiction of the State-owned land, etc. (including persons to whom duties have been delegated or entrusted pursuant to Article 28 or 42 (1) of the State Property Act; hereinafter the same shall apply) within the limit set forth below: <Amended on Apr. 1, 2011; Jun. 11, 2013; Oct. 15, 2014; Apr. 20, 2015; Jul. 28, 2016; Mar. 31, 2020; Aug. 5, 2020; Jun. 22, 2021; Dec. 5, 2023> |
| 1. | For land, etc. referred to in Article 13-2 (1) 1 of the Act: Reduction or exemption rates shall be as follows: |
| (a) | 100/100 of rents for the relevant land, etc. in the case of the following businesses: |
| (i) | A business run by a foreign-invested company in a foreign investment zone designated under Article 18 (1) 2 of the Act out of businesses provided for in paragraph (6) 1 (a), and a business provided for in paragraph (6) 1 (b) or (7) 1 (a); |
| (ii) | A business producing materials, components, or equipment defined under subparagraph 1 or 2 of Article 2 of the Act on Special Measures for Strengthening the Competitiveness of Materials, Components, and Equipment Industries (limited to a business taking occupancy in a foreign investment zone developed under Article 18 of the Act for the purpose of leasing or selling to foreign-invested companies which produce materials, components, or equipment defined under subparagraph 1 or 2 of Article 2 of the Act on Special Measures to Strengthen Competitiveness and Stabilize Supply Chain of Materials, Components, and Equipment Industries out of businesses provided for in paragraph (6) 1 (c)); |
| (iii) | A business with at least 200 regular workers, of the businesses provided for in paragraph (6) 1 (d) or (7) 1 (c); |
| (b) | 90/100 of rents for the relevant land, etc. in the case of a business with at least 150 but no more than 200 regular workers, of the businesses provided for in paragraph (6) 1 (d) or (7) 1 (c); |
| (c) | 75/100 of rents for the relevant land, etc. in the case of the following businesses: |
| (i) | A business prescribed in paragraph (6) 1 (c) [excluding a business eligible for reduction or exemption under item (a) (ii)] or a business prescribed in paragraph (7) 1 (b); |
| (ii) | A business with at least 70 but no more than 150 regular workers, of the businesses provided for in paragraph (6) 1 (d) or (7) 1 (c); |
| (iii) | A business referred to in paragraph (6) 2 or paragraph (7) 2; |
| (d) | 50/100 of rents for the relevant land, etc. in the case of a business run by a foreign-invested company in a foreign investment zone designated under Article 18 (1) 3 or 4 of the Act among the businesses provided for in paragraph (6) 1 (a); |
| 2. | For land, etc. referred to in Article 13-2 (1) 2 and 3 of the Act: 50/100 of rents for the relevant land, etc. |
| (9) | The reduction or exemption rate of rents for State-owned land, etc. under Article 13-2 (2) of the Act shall be determined by the head of the central government agency having the jurisdiction over the relevant State property within 100/100. <Amended on Apr. 1, 2011; Jun. 11, 2013; Aug. 5, 2020; Jun. 22, 2021> |
| (10) | A foreign-invested company, a repatriating enterprise in a non-Seoul metropolitan area, or an operator of a facility Improving Foreign Investment Environment who intends to receive a rent reduction or exemption for land, etc. owned by the State under Article 13-2 (1) or (2) shall file an application for such reduction or exemption with the head of the central government agency having jurisdiction over the relevant State property. <Amended on Apr. 1, 2011; Jun. 11, 2013; Aug. 5, 2020; Jun. 22, 2021> |
| (11) | A foreign-invested company or operator of establishments built to improve a foreign-investment environment (hereafter in this Article, referred to as "foreign-invested company, etc.") who intends to receive a rent reduction or exemption for land, etc. owned by a local government under Article 13-2 (3) of the Act shall file an application for such reduction or exemption with the head of the relevant local government; <Amended on Jun. 11, 2013; Aug. 5, 2020; Jun. 22, 2021> |
| (12) | A foreign-invested company, etc. that intends to receive a rent reduction or exemption for land, etc. owned by a local government pursuant to Article 13-2 (3) of the Act shall meet both of the following requirements: <Added on Jul. 28, 2016; Aug. 5, 2020; Jun. 22, 2021> |
| 1. | When the foreign-invested company, etc. falls under the main clause of Article 13 (2) of the Act: it shall meet the minimum foreign investment ratio referred to in paragraph (1) during the lease term; provided, it shall maintain the foreign investment ratio at 10/100 or higher when domestic capital increases without any decrease of the amount of foreign investment after concluding a contract; |
| 2. | When the foreign-invested company, etc. falls under the proviso of Article 13 (2) of the Act: it shall maintain the foreign investment ratio at 10/100 or higher. |
| (13) | Except as provided in paragraphs (11) and (12), specific matters, such as the types of businesses eligible for rent reductions or exemptions for land, etc. owned by a local government, the reduction or exemption rate of rents, shall be determined by municipal ordinance of a local government, taking into account the economic effects of the relevant foreign investment, such as the creation of employment, the transfer of technology, and the effect on the financial independence of the relevant local government. <Amended on Jun. 11, 2013; Jul. 28, 2016; Jun. 22, 2021> |
| (14) | Upon receipt of an application for a rent reduction or exemption for land, etc. owned by the State or a local government filed under paragraph (10) or (11), the head of the central government agency or the head of the local government having the jurisdiction of such State-owned property shall determine whether to grant a rent reduction or exemption to the relevant applicant after reviewing whether the application meets the requirements for reduction or exemption prescribed in paragraphs (6) through (9) and (12), and verify if the relevant foreign-invested company remains in compliance with the requirements for reduction or exemption at least once a year. <Added on Jul. 28, 2016; Jun. 22, 2021> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 19-2 (Sale of State or public property) |
| (1) | "A company which satisfies the minimum foreign investment ratio prescribed by Presidential Decree" in the main clause of Article 13-3 (2) of the Act means a company which satisfies the requirements under Article 19 (1). |
| (2) | "Period prescribed by Presidential Decree" in the main clause of Article 13-3 (2) of the Act means five years from the date of conclusion of a negotiated contract under Article 13-3 (1) of the Act. |
| (3) | The deferred payment of the purchase price of land, etc. or the payment in installments under Article 13-3 (3) of the Act shall be made by the methods referred to in the following subparagraphs. In such cases, the applicable interest rate shall not exceed four percent per annum: |
| 1. | Where the relevant land, etc. is owned by the State: Payment may be deferred up to one year or payment in installments up to 20 years may be allowed; |
| 2. | Where the relevant land, etc. is owned by a local government: Payment may be deferred or made in installments, as prescribed by municipal ordinance. |
[This Article Added on Aug. 5, 2020]
| Article 20 (Criteria for support to local governments) |
| (1) | The criteria for financial support to be provided by the State to a local government in accordance with Article 14 (1) of the Act shall be determined by the Foreign Investment Committee after taking a comprehensive account of the potential economic effects that will be brought about by the foreign investment concerned, such as the creation of employment and the transfer of technology, and the region which the relevant foreign-invested company will move into. |
| (2) | The head of a central administrative agency who has received a request for financial support by a local government shall render support as requested in accordance with the criteria for financial support as determined by the Foreign Investment Committee. |
| (3) | "Any person prescribed by Presidential Decree" in Article 14 (1) of the Act means an operator of an industrial complex development project under Article 16 (1) of the Industrial Sites and Development Act. |
| (4) | "Employment subsidy, etc. as prescribed by Presidential Decree" in Article 14 (4) of the Act means the following: |
| 1. | Employment subsidy that is paid according to the creation scale of new employment of a foreign-invested company; |
| 2. | Land price and construction costs necessary for newly building or extending a foreigners' school under Article 60-2 of the Elementary and Secondary Education Act. |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 20-2 (Uses of cash grants for foreign investment) |
| (1) | "Ratio prescribed by Presidential Decree" in the provision, with the exception of the subparagraphs, of Article 14-2 (1) of the Act means 30/100. <Added on Aug. 5, 2020> |
| (2) | "Uses prescribed by Presidential Decree, including the creation or extension of factory facilities" in the provisions, with the exception of the subparagraphs, of Article 14-2 (1) of the Act means any of the following uses: <Amended on Oct. 5, 2010; Aug. 5, 2020> |
| 1. | Purchase costs of, or rents for, land or buildings for establishing a factory facility or research facility; |
| 2. | Building costs of a factory facility or research facility; |
| 3. | Purchase costs of capital goods, research equipment and materials to be used for projects or research at a factory facility or research facility; |
| 4. | Installation costs of infrastructure, such as electricity and communications facilities necessary for establishing a factory facility or research facility; |
| 5. | Employment subsidies or education and training subsidies. |
| (3) | "Materials, components, and equipment ... prescribed by Presidential Decree" in Article 14-2 (1) 3 of the Act means materials, components, and equipment as defined in Article 2 of the Enforcement Decree of the Act on Special Measures to Strengthen Competitiveness and Stabilize Supply Chain of Materials, Components, and Equipment Industries. <Amended on Oct. 15, 2014; Apr. 20, 2015; Mar. 31, 2020; Aug. 5, 2020; Dec. 5, 2023> |
| (4) | The number of regular workers referred to in Article 14-2 (1) 4 of the Act shall be as specified in Appendix 2. <Amended on Aug. 5, 2020> |
| (5) | "Standards prescribed by Presidential Decree" in Article 14-2 (1) 6 of the Act means where a foreign investor falls under any of the following cases: <Amended on Mar. 11, 2014; Oct. 15, 2014; Sep. 18, 2018; Aug. 5, 2020; Jul. 7, 2023; Jul. 18, 2023; Oct. 1, 2025> |
| 1. | Where the foreign investor, in its capacity as a domestic corporation that serves as a support and control tower for at least 2 foreign corporations in terms of their production, sales, distribution, personnel affairs, and other core corporate functions, establishes a local headquarters in the Republic of Korea that meets the criteria and procedure requirements prescribed by Decree of the Ministry of Trade, Industry and Resources on regular workers, holding company, etc.; |
| 2. | Where the foreign investor engages in a local specialized industry defined in subparagraph 6 of Article 2 of the Special Act on Local Autonomy, Decentralization and Balanced Regional Development or mega-region industry defined in subparagraph 8 of that Article, and such industry is deemed likely to contribute to developing the regional economy; |
| 3. | Where it is recognized that the foreign investor will significantly contribute to the development of domestic industry and technology by researching and developing technologies referred to in Article 121-2 (1) 1 of the Act on Restriction on Special Cases concerning Taxation or advanced technologies or advanced products referred to in Article 5 (1) of the Industrial Development Act. |
| 4. | Where the foreign investor intends to replace the existing factory facilities with new ones falling under any of the following, which are deemed to meet the standards publicly notified by the Minister of Trade, Industry and Resources and to significantly contribute to the development of the domestic industry and technology: |
| (a) | Facilities for commercializing national strategic technology under Article 24 (1) 2 (a) (ii) of the Act on Restriction on Special Cases concerning Taxation; |
| (b) | Factory facilities to run a business under Article 121-2 (1) 1 of the Act on Restriction on Special Cases concerning Taxation; |
| (c) | Factory facilities to run a business utilizing advanced technology and advanced products under Article 5 (1) of the Industrial Development Act. |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 20-3 (Applications for, and payment of, cash grants for foreign investment) |
| (1) | A foreigner who intends to obtain a cash grant from the State pursuant to Article 14-2 (1) of the Act shall file an application for cash grant in the form prescribed by Decree of the Ministry of Trade, Industry and Resources, which shall be accompanied by an investment plan that includes the following matters, with the Minister of Trade, Industry and Resources: <Amended on Mar. 23, 2013; Jul. 28, 2016; Oct. 1, 2025> |
| 1. | Total amount of investment and details thereof; |
| 2. | Scale of employment; |
| 3. | Effects of technological diffusion; |
| 4. | Level of contribution to the local economy; |
| 5. | Other matters determined by the Minister of Trade, Industry and Resources. |
| (2) | Upon receipt of an application filed under paragraph (1), the Minister of Trade, Industry and Resources shall evaluate the investment plan and consult with the Minister of Economy and Finance on whether to award a cash grant, the grant amount, etc. after negotiating with the relevant foreigner. <Amended on Mar. 23, 2013; Dec. 30, 2015; Oct. 1, 2025> |
| (3) | The Minister of Trade, Industry and Resources may pay a cash grant in lump sum within one year from the date on which a decision to award the cash grant is made, or in up to 10 installments within 5 years from the date of such decision. <Amended on Mar. 23, 2013, Oct. 1, 2025> |
| (4) | Where the Minister of Trade, Industry and Resources pays a cash grant in installments under paragraph (3), he or she may adjust the amount and timing for the cash grant paid in installments, taking into account any modification to the investment plan and the outcomes of executing the cash grant paid in installments. <Amended on Mar. 23, 2013, Oct. 1, 2025> |
| (5) | Except as provided in paragraphs (1) through (4), matters necessary for providing cash grants and other matters shall be determined by the Minister of Trade, Industry and Resources following deliberation by the Foreign Investment Committee. <Amended on Mar. 23, 2013, Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 20-4 (Cancellation, withdrawal, reduction, and recovery of cash grants for foreign investment) |
| (1) | "Where an applicant ... files the application by fraud or other improper means or any other ground prescribed by Presidential Decree occurs" in Article 14-2 (5) of the Act means any of the following: |
| 1. | Where an applicant files an application for cash grants by fraud or other improper means; |
| 2. | Where the duties under the contract for cash grant are not performed; |
| 3. | Where it is no longer possible for the corporation or enterprise to engage in the relevant business during the contract period due to the bankruptcy, closure, or the like. |
| (2) | Matters necessary for the methods and procedures for cancellation, withdrawal, reduction, recovery, etc. of cash grants for the applicant and other matters shall be determined and publicly notified by the Minister of Trade, Industry and Resources following deliberation by the Foreign Investment Committee. <Amended on Oct. 1, 2025> |
[This Article Added on Aug. 5, 2020]
| Article 21 (Administration of foreign investment support center) |
| (1) | Public officials or executive officers or employees of a foreign investment-related agency who have been dispatched to the Foreign Investment Support Center (hereinafter referred to as the "Investment Support Center") under Article 15 (2) of the Act (hereinafter referred to as "dispatched officers") shall be subject to direction and supervision by the president of the Korea Trade-Investment Promotion Agency with respect to their services. <Amended on Jul. 30, 2009> |
| (2) | The president of the Korea Trade-Investment Promotion Agency shall prepare a written opinion on performance evaluation of the public officials dispatched under paragraph (1) in accordance with Article 17 (3) of the Regulations on Performance Evaluation of Public Officials or Article 31-3 (3) of the Decree on the Appointment of Local Public Officials, and forward the written opinion to the heads of the relevant administrative agencies to which such public officials belong, and the heads of the relevant administrative agencies in receipt of such written opinions shall take them into consideration when evaluating the performance of the relevant public officials. <Amended on Jul. 30, 2009> |
| (3) | In order to efficiently perform foreign investment supporting affairs, the president of the Korea Trade-Investment Promotion Agency may operate a general administrative support center that mainly consist of dispatched officers and teams exclusively responsible for foreign investment inducement that mainly consist of officers and employees of the Korea Trade-Investment Promotion Agency, and may require the dispatched officers to concurrently perform the duties of the staff in exclusive charge of complaint settlement pursuant to Article 21-4 (5). <Amended on Jul. 30, 2009; Oct. 5, 2010> |
| (4) | The president of the Korea Trade-Investment Promotion Agency shall prepare an annual comprehensive plan for foreign investment inducement and submit it to the Minister of Trade, Industry and Resources by January 31 each year, and shall analyze quarterly foreign investment achievements and report the results thereof to the Minister of Trade, Industry and Resources within 1 month after the expiration of each quarter. <Amended on Jul. 30, 2009; Mar. 23, 2013; Oct. 1, 2025> |
| (5) | Deleted. <Oct. 27, 1999> |
| (6) | Deleted. <Oct. 27, 1999> |
| (7) | Deleted. <Oct. 27, 1999> |
| (8) | Except as provided in paragraphs (1) through (4), matters necessary for the organization and operation of the Investment Support Center shall be determined by the president of the Korea Trade-Investment Promotion Agency following deliberation by the Foreign Investment Committee. <Amended on Jul. 30, 2009> |
| Article 21-2 (Designation and duties of project managers) |
| (1) | The president of the Korea Trade-Investment Promotion Agency may designate any of the following persons as a project manager for each foreign investor or each foreign-invested company in order to render efficient support to investment affairs of a foreign investor or foreign-invested company. In such cases, the president of the Korea Trade-Investment Promotion Agency shall notify the relevant foreign investor or foreign-invested company of the designated project manager: |
| 1. | Employees of the Korea Trade-Investment Promotion Agency; |
| 2. | Dispatched officers; |
| 3. | Public officials or employees of a central administrative agency, local government, and public institution provided for in the Act on the Management of Public Institutions (hereinafter referred to as "public institution") related to foreign investment. In such cases, he or she shall obtain approval from the head of the relevant agency, government or institution. |
| (2) | The president of the Korea Trade-Investment Promotion Agency may notify the central administrative agency, local governments and public institutions in charge of foreign investment-related affairs (referred to as "related administrative agencies, etc." hereafter in this Article) of the project manager designated for each foreign investor or foreign- invested company under paragraph (1) (hereinafter referred to as "project manager"). |
| (3) | The related administrative agencies, etc. upon receipt of the notification under paragraph (2) shall positively cooperate therewith when a project manager requests cooperation with respect to the provision of materials and handing of civil affairs related to a foreign investment. |
| (4) | A project manager shall perform the following duties: |
| 1. | Collection and provision of data or information and arranging interviews at the request of a foreign investor or foreign- invested company; |
| 2. | Presentation of opinions regarding support related to foreign investments under Articles 9, 13, 14 and 14-2 of the Act; |
| 3. | Assistance in the affairs and vicarious execution of civil affairs related to foreign investments under Articles 15 and 17 of the Act; |
| 4. | Assistance in resettlement of the officers, employees and their families of a foreign investor or foreign- invested company, such as housing rental and guidance for school admission; |
| 5. | Other affairs related to foreign investments. |
| (5) | The president of the Korea Trade-Investment Promotion Agency may constitute and operate a consultative council for support purposes with foreign investors, related administrative agencies, etc., if necessary to ensure that project managers efficiently perform their duties specified in paragraph (4). <Added on Dec. 30, 2015> |
| (6) | The president of the Korea Trade-Investment Promotion Agency shall provide project managers with opportunities for education necessary to improve their quality and expertise. <Amended on Dec. 30, 2015> |
| (7) | The president of the Korea Trade-Investment Promotion Agency may accord preferential treatment to project managers in relation to promotion, transfer, and reward. <Amended on Dec. 30, 2015> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 21-3 (Functions of foreign investment ombudsman) |
| (1) | The term of office of a foreign investment ombudsman commissioned under Article 15-2 (1) of the Act (hereinafter referred to as the "foreign investment ombudsman") shall be three years. <Amended on Oct. 5, 2010> |
| (2) | A foreign investment ombudsman shall perform the following duties: <Amended on Oct. 5, 2010> |
| 1. | Investigation and handling of complaints from foreign investors and foreign-invested companies; |
| 2. | Preparation of policy measures for improving a foreign investment system and recommendation on the implementation thereof to the relevant administrative agencies and public agencies; |
| 3. | Other necessary matters for handling complaints from foreign investors and foreign-invested companies. |
| (3) | "Standards prescribed by Presidential Decree" in Article 15-2 (3) 1 of the Act means any of the following: <Amended on Oct. 5, 2010> |
| 1. | Where it is necessary for investigating whether a foreign investment-related system complies with international practices or standards; |
| 2. | Where it is necessary for tackling difficulties experienced by foreign-invested companies in their management or improving the related systems; |
| 3. | Where it is necessary for improving the living conditions of foreign investors and foreigners working for foreign-invested companies. |
| (4) | A recommendation for corrective measures under Article 15-2 (4) of the Act (hereafter referred to as "recommendation for corrective measures" in this Article) shall be made in a document specifying the following matters: <Added on Oct. 5, 2010> |
| 1. | Current status and problems of related statutes and regulations, systems, and policies; |
| 2. | Details of recommendation for corrective measures; |
| 3. | Matters recognized by the foreign investment ombudsman as being necessary, such as the reply deadline for related administrative agencies and public agencies. |
| (5) | "Period prescribed by Presidential Decree" in Article 15-2 (5) of the Act means 30 days after receipt of a recommendation to take corrective measures from the foreign investment ombudsman pursuant to Article 15-2 (4) of the Act. <Added on Jun. 11, 2013> |
| (6) | The foreign investment ombudsman may check and inspect the performance of the details of recommendations for corrective measures. <Added on Oct. 5, 2010; Jun. 11, 2013> |
| (7) | The foreign investment ombudsman shall prepare an annual report including the following matters pursuant to Article 15-2 (7) of the Act and submit it to the Foreign Investment Committee by the end of February of the following year: <Added on Jun. 11, 2013> |
| 1. | Current status of the regulations and systems raised as grievances by foreign investors and foreign-invested companies; |
| 2. | Results of improvement of the regulations and systems by the foreign investment ombudsman in the previous year; |
| 3. | Other matters concerning supportive activities to tackle grievances of foreign investors and foreign-invested companies. |
[This Article Wholly Amended on Jul. 30, 2009]
[Moved from Article 21-4; (Previous) Article 21-3 moved to Article 21-4 <Oct. 5, 2010>]
| Article 21-4 (Operation of grievance committee) |
| (1) | Deleted. <Feb. 24, 2001> |
| (2) | The foreign investment ombudsman shall be the head of the grievance committee established under Article 15-2 (10) of the Act (hereinafter referred to as "grievance committee"). <Amended on Oct. 5, 2010; Jun. 11, 2013> |
| (3) | The head of the grievance committee may request cooperation from a relevant administrative agency or a foreign-investment related agency to settle complaints from foreign investors and foreign-invested companies. In such cases, the agency upon receipt of a request for cooperation shall present the results of resolving complaints or its opinion on such matters within seven days after receipt of the request. <Amended on Jul. 30, 2009; Oct. 5, 2010> |
| (4) | Deleted. <Dec. 31, 2001> |
| (5) | In order to efficiently settle complaints from foreign investors and foreign-invested companies, the head of the grievance committee may designate the staff in exclusive charge of settling complaints for each region or foreign-invested company, and may administer such staff. <Amended on Oct. 5, 2010> |
| (6) | Where an employee belonging to the grievance committee hears opinions or visits a site under Article 15-2 (3) of the Act to support the duties of the foreign investment ombudsman, he or she shall carry identification indicating his or her authority and present it to relevant persons. <Added on Oct. 5, 2010> |
| (7) | The head of the grievance committee shall analyze the results of settling complaints raised by foreign-invested companies on a quarterly basis and report them to the Minister of Trade, Industry and Resources within 1 month after expiration of each quarter. <Amended on Jul. 30, 2009; Oct. 5, 2010; Mar. 23, 2013; Oct. 1, 2025> |
| (8) | Except as provided in paragraphs (2), (3), (5), (6), and (7), matters necessary for the organization and operation of the grievance committee shall be determined by the president of the Korea Trade-Investment Promotion Agency following deliberation by the Foreign Investment Committee. <Amended on Jul. 30, 2009; Oct. 5, 2010> |
[This Article Added on Oct. 27, 1999]
[Moved from Article 21-3; (Previous) Article 21-4 moved to Article 21-3 <Oct. 5, 2010>]
| Article 22 (Responsibilities of foreign investment promotion offices) |
| (1) | A foreign investment promotion office under Article 16 of the Act shall carry out the following: |
| 1. | Encouragement and verification of the proper treatment of civil petitions transmitted in accordance with Article 17 (3) of the Act; |
| 2. | The discharge of civil petition duties on behalf of others, such as preparation and submission of civil petition documents concerning foreign investment; |
| 3. | Inducement of, advertisement on, and support for foreign investment; |
| 4. | Receipt, examination, and resolution of difficulties suffered or propositions expressed by foreign investors or foreign-invested companies; |
| 5. | Exchange of information, communication for business purposes, and administrative cooperation with the Investment Support Center, the trade centers, branches and offices of the Korea Trade-Investment Promotion Agency, and other agencies related to the inducement of foreign investment; |
| 6. | Examination of the legitimacy of reasons for refusal to grant permission as notified in accordance with the latter part of Article 17 (5) of the Act; |
| 7. | Operation of the Foreign Investment Inducement Council as prescribed in Article 23; |
| 8. | Other kinds of administrative support concerning foreign investment. |
| (2) | Every foreign investment promotion official shall, upon receipt of a request from the head of a grievance committee to submit the current status of the receipt, examination and resolution of difficulties prescribed in paragraph (1) 4, cooperate with the head of the grievance committee by submitting it within 10 days after the end of every quarter. <Amended on Oct. 5, 2010> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 23 (Foreign Investment Inducement Council) |
| (1) | In order to deliberate and decide on the following matters, a Foreign Investment Inducement Council (hereinafter referred to as the "Council") may be established in the Special Metropolitan City, a Metropolitan City, the Special Self-Governing City, a |
| 1. | A plan to induce, publicize and support foreign investments; |
| 2. | Consultation for settling grievances of foreign investors or foreign-invested companies; |
| 3. | Matters concerning consultation for proper handling of civil petitions as prescribed in Article 17 of the Act; |
| 4. | Other matters deemed necessary by the Mayor/ |
| (2) | A public official in the position of director or higher position among those who belong to the City/ |
| 1. | Persons designated by the Mayor/ |
| 2. | From among the public officials or other employees of the competent |
| 3. | From among the heads of the trade centers, branches, and offices of the Korea Trade-Investment Promotion Agency, persons designated by the head of the Investment Support Center at the request of the Mayor/ |
| 4. | Persons commissioned by the Mayor/ |
| (3) | In designating or commissioning members of the Council as prescribed in paragraph (2), members who can participate in all the meetings of the Council and members who, according to the decision of the Chairperson of the Council, can participate in those meetings only at which matters relevant to the members concerned are discussed may be divided in the process of the designation or commission. <Amended on Jan. 5, 2021> |
| (4) | The resolution of a meeting of the Council shall require the presence of a majority of members who can participate in such meeting pursuant to paragraph (3) and the consent of a majority of members present. |
| (5) | Except as provided in paragraphs (1) through (4), matters necessary for the operation of the Council shall be determined by the Mayor/ |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 24 (Handling of civil petitions by foreign investors) |
| (1) | The scope of civil petitions to be handled directly, and the handling period, as prescribed in Article 17 (2) and (5) of the Act, shall be as specified in Appendix 3. <Amended on Jul. 30, 2009> |
| (2) | The handling period for civil petitions to be handled in bulk and civil petitions to be individually handled as prescribed in Article 17 (5) of the Act shall be as follows: <Amended on Jul. 30, 2009> |
| 1. | For civil petitions to be handled in bulk: the period specified in Appendix 4; provided, where civil petitions concerning permission, etc. on the right column of Appendix 1 of the Act are individually received, the handling period under the relevant statutes and regulations; |
| 2. | For the civil petitions to be handled individually: the handling period under the relevant statutes and regulations. |
| (3) | Where the head of a civil affairs administrative agency, having received civil petitions to be handled in bulk, has requested consultation with the head of a relevant agency in accordance with Article 17 (4) of the Act, the head of the relevant agency shall submit his or her opinions to the head of the civil affairs administrative agency by the day preceding the date on which such handling period as specified in Appendix 4 expires (where the handling period as specified in Appendix 4 exceeds seven days, by two days before the last day of the handling period). <Amended on Jul. 30, 2009> |
| (4) | The record date for calculating the handling period under paragraphs (1) and (2) shall be the day of the receipt of the civil petition concerned by the head of the civil affairs administrative agency or the dispatched officer concerned. <Amended on Jul. 30, 2009> |
| (5) | "Permission, etc. as prescribed by Presidential Decree" in subparagraph 13 of Appendix 2 of the Act means such business matters of civil petitions as specified in Appendix 5. <Amended on Jul. 30, 2009> |
| (6) | Where the head of a civil affairs administrative agency or a dispatched officer makes notification of his or her refusal to grant permission in accordance with the latter part of Article 17 (5) of the Act, he or she shall specify the reasons and the legal basis for the refusal. <Amended on Jul. 30, 2009> |
| (7) | "Period prescribed by Presidential Decree" in the former part of Article 17 (7) of the Act means three days. <Amended on Jul. 30, 2009> |
| (8) | Where the head of a civil affairs administrative agency grants permission with conditions attached in accordance with Article 17 (10) of the Act, he or she shall attach a condition that insufficient points be supplemented by the time as prescribed by one of the following subparagraphs: <Amended on Jul. 30, 2009> |
| 1. | For permission, etc. prescribed in subparagraph 1 or 2 of Appendix 1 of the Act: the time of the application for construction permission (where construction permission is considered to have been granted, the time of the report on the commencement of construction); |
| 2. | For permission, etc. prescribed in subparagraph 3 of Appendix 1 of the Act: the time of the report on the commencement of construction; |
| 3. | For permission, etc. prescribed in subparagraph 4 of Appendix 1 of the Act: the time of the report on the commencement of operations; |
| 4. | For permission, etc. prescribed in subparagraph 5 of Appendix 1 of the Act: the time of the registration into the building ledger. |
| (9) | Where the person who receives permission, etc. with conditions attached in accordance with Article 17 (10) of the Act files an application for permission, etc. under any of subparagraphs of paragraph (8), he or she shall submit to the head of the civil affairs administrative agency a written confirmation that he or she has fully implemented the aforementioned conditions. <Amended on Jul. 30, 2009> |
| (10) | Deleted. <Jan. 13, 2004> |
| (11) | Where a reasonable and objective ground is deemed to exist for not being able to properly handle civil petitions within the handling period prescribed in paragraph (1) or (2), the head of a civil affairs administrative agency may extend the handling period only once. In such cases, the head of the civil affairs administrative agency concerned shall determine an additional period to be extended by estimating the necessary time for the proper handling, and notify the applicant for the permission, etc. concerned (where the application for permission has been filed vicariously by the Investment Support Center, the head of the Investment Support Center) of the extended handling period and the reasons for the extension of the handling period, and where the head of the Investment Support Center has received the notification, he or she shall, without delay, notify the original applicant for the permission, etc. concerned of the details of said notification. <Amended on Jul. 30, 2009> |
| (12) | Where supplement or correction is deemed to be necessary with respect to the contents of the application for the handling of civil petitions to be handled in bulk, civil petitions to be individually handled, or civil petitions to be directly handled as prescribed in Article 17 of the Act, the head of a civil affairs administrative agency or a dispatched officer may determine the period for the supplementation or correction and request the person concerned to supplement or correct them within such period. In such cases, the period consumed for such supplementation or correction shall not be included in the handling period as prescribed in paragraphs (1) and (2). <Amended on Jul. 30, 2009> |
| (13) | Except as provided in the Act or this Decree, the handling of civil petitions which are concerned with foreign investment shall be governed by the Civil Petitions Treatment Act. <Amended on Jul. 30, 2009; Jun. 22, 2021> |
CHAPTER IV FOREIGN INVESTMENT ZONES
| Article 25 (Designation of foreign investment zones) |
| (1) | "Foreign investment meeting the standards prescribed by Presidential Decree" in Article 18 (1) 2 of the Act means any of the following foreign investments. In such cases, an amount of money equivalent to the holding ratio calculated by the methods provided for in Article 116-2 (11) and (12) of the Enforcement Decree of the Act on Restriction on Special Cases concerning Taxation shall be disregarded for the purpose of computing the amount of foreign investment in cases of a foreign corporation, the stocks or equity shares of which, are directly or indirectly owned by a national of the Republic of Korea (excluding persons falling under Article 3) or a Korean corporation: <Amended on Sep. 9, 2009; Oct. 5, 2010; Mar. 23, 2013; Jun. 11, 2013; Oct. 15, 2014; Jul. 28, 2016; Mar. 29, 2017; Jul. 28, 2020; Aug. 5, 2020; Jan. 5, 2021; Jun. 22, 2021; Aug. 26, 2025; Oct. 1, 2025> |
| 1. | Where the amount of foreign investment is at least 30 million U.S. dollars and new factory facilities are established to engage in any of the following businesses: |
| (a) | Manufacturing business; |
| (b) | Business under Article 121-2 (1) 1 of the Act on Restriction on Special Cases concerning Taxation; |
| (c) | Computer programming business, system integration and management business in the knowledge service industry, and data processing business, hosting (referring to services such as lease and operation of servers), and related service-providing business in the information service industry under the Korean Standard Industrial Classification; |
| 2. | Where the amount of foreign investment is at least 20 million U.S. dollars and new facilities are established engage in any of the following businesses: |
| (a) | Resort condominium business as prescribed in Article 3 (1) 2 (b) of the Tourism Promotion Act; |
| (b) | Any of the following tourist businesses: |
| (i) | Tourist hotel business, floating tourist hotel business, or Korean traditional hotel business defined under Article 2 (1) 2 (a) through (c) of the Enforcement Decree of the Tourism Promotion Act; |
| (ii) | Specialized resort business or general resort complex business defined under Article 2 (1) 3 (a) or (b) of the Enforcement Decree of the Tourism Promotion Act; |
| (iii) | Comprehensive theme park business defined in Article 2 (1) 5 (a) of the Enforcement Decree of the Tourism Promotion Act; |
| (c) | Deleted; <Jul. 28, 2016> |
| (d) | International conference facilities defined under subparagraph 3 of Article 2 of the International Conference Industry Promotion Act; |
| (e) | Deleted; <Jun. 22, 2021> |
| (f) | Youth training facilities prescribed in subparagraph 1 of Article 10 of the Youth Activity Promotion Act; |
| (g) | Places of public performance under subparagraph 4 of Article 2 of the Public Performance Act; |
| (h) | Sports industry promotion facilities defined in subparagraph 3 of Article 2 of the Sports Industry Promotion Act; |
| (i) | Museums and art galleries established and operated by a corporation out of those defined in subparagraphs 1 and 2 of Article 2 of the Museum and Art Gallery Support Act; |
| 3. | Where the amount of foreign investment is at least 10 million U.S. dollars and new facilities are established to engage in any of the following businesses: |
| (a) | Complex logistics terminal business defined under subparagraph 4 of Article 2 of the Act on the Development and Management of Logistics Facilities; |
| (b) | Business creating and operating a joint collection and delivery complex defined under subparagraph 16 of Article 2 of the Distribution Industry Development Act; |
| (c) | Business operating harbor facilities defined under subparagraph 5 of Article 2 of the Harbor Act, and cargo distribution business prescribed in Article 5 (8) of the Enforcement Decree of the Act on Restriction on Special Cases concerning Taxation which is run within a harbor hinterland complex defined under subparagraph 10 of Article 2 of the Harbor Act; |
| (d) | Business operating airport facilities defined under subparagraph 7 of Article 2 of the Airport Facilities Act, and cargo distribution business prescribed in Article 5 (8) of the Enforcement Decree of the Act on Restriction on Special Cases concerning Taxation that is run within an airport zone defined under subparagraph 4 of Article 2 of the Airport Facilities Act; |
| (e) | Business creating infrastructure (limited to revertible facilities defined under subparagraph 3 of Article 2 of the Act on Public-Private Partnerships in Infrastructure) by implementing a public-private partnership project defined under subparagraph 5 of Article 2 of that Act; |
| 4. | Where the amount of foreign investment is at least 2 million U.S. dollars and a facility that meets each of the following is established or added, among research and development facilities that meets the criteria and procedure requirements prescribed by Decree of the Ministry of Trade, Industry and Resources in terms of the amount of facility investment, personnel in exclusive charge of research, etc.: |
| (a) | It shall be a research and development facility to engage in the business prescribed in Article 121-2 (1) 1 of the Act on Restriction on Special Cases concerning Taxation (hereafter in this subparagraph, referred to as "business"); |
| (b) | Deleted; <Jul. 28, 2016> |
| (c) | The number of regular workers dedicated to research with at least a master's degree related to the business and at least three years’ research career shall be at least 10 persons. |
| (2) | "Areas prescribed by Presidential Decree ... such as special research and development zones under subparagraph 1 of Article 2 of the Special Act on Promotion of Special Research and Development Zones" in Article 18 (1) 3 of the Act means any of the following areas: <Added on Oct. 5, 2010; Jul. 26, 2012; Oct. 29, 2019; Jun. 22, 2021> |
| 1. | A special research and development zone under subparagraph 1 of Article 2 of the Special Act on Promotion of Special Research and Development Zones; |
| 2. | A Technopark defined under subparagraph 1 of Article 2 of the Act on Special Cases concerning Support for Technoparks; |
| 3. | A knowledge industry center defined under subparagraph 13 of Article 2 of the Industrial Cluster Development and Factory Establishment Act; |
| 4. | A high-tech medical complex defined under subparagraph 1 of Article 2 of the Special Act on the Promotion of High-Tech Medical Complexes. |
| (3) | "Service business ... prescribed by Presidential Decree" in the former part of Article 18 (1) 4 of the Act means the following service businesses: <Added on Oct. 5, 2010; Jun. 11, 2013; Jul. 28, 2016; Jul. 18, 2023> |
| 1. | Finance and insurance business under the Korea Standard Industrial Classification; |
| 1-2. | Company headquarters under the Korean Standard Industrial Classification (limited to cases where the headquarters functions as a local headquarters under Article 20-2 (5) 1); |
| 2. | Knowledge service business defined under Appendix 2 of the Enforcement Decree of the Industrial Development Act; |
| 3. | Deleted; <Jun. 22, 2021> |
| 4. | Cultural industries defined under subparagraph 1 of Article 2 of the Framework Act on the Promotion of Cultural Industries; |
| 5. | Tourism business defined under subparagraph 1 of Article 2 of the Tourism Promotion Act (excluding casino business classified under Article 3 (1) 5 of that Act). |
| (4) | "Percentage prescribed by Presidential Decree" in the latter part of Article 18 (1) 4 of the Act means 50/100. <Amended on Oct. 5, 2010> |
| (5) | "Standards prescribed by Presidential Decree" in Article 18 (2) of the Act means all of the following matters: <Amended on Oct. 5, 2010; Nov. 16, 2011; Dec. 30, 2015; Jul. 28, 2016> |
| 1. | The total amount of money invested by two or more foreign investors shall be no less than the amount of foreign investment prescribed for each type of business in the subparagraphs of paragraph (1) (in the case of subparagraph 4, it means a facility; hereinafter the same shall apply); |
| 2. | The category of business or business being engaged in shall correspond to the category of business or business referred to in any subparagraph of paragraph (1); |
| 3. | The facilities referred to in the subparagraphs of paragraph (1) shall be placed adjacent to each another. |
| (6) | "Matters prescribed by Presidential Decree" in Article 18 (3) 6 of the Act means matters classified below: <Added on Oct. 5, 2010; Mar. 23, 2013> |
| 1. | The following matters when designating any area referred to in Article 18 (1) 1 or 3 of the Act as a foreign investment zone: |
| (a) | The implementer and the managing institution of the development project; |
| (b) | A land utilization plan and a plan for major infrastructure; |
| (c) | Other matters determined by the Foreign Investment Committee based on the characteristics of each region; |
| 2. | The following matters when designating any area referred to in Article 18 (1) 2 of the Act as a foreign investment zone; provided, the matters referred to in items (f) through (i) may be omitted when designating the whole or any part of a national industrial complex, general industrial complex, or urban high-tech industrial complex, the development of which has already been completed, as a foreign investment zone: |
| (a) | Details of investment, scale of employment, and details of business of foreign- invested companies to take occupancy in the foreign investment zone; |
| (b) | Viability of foreign investment to be induced; |
| (c) | Funding plans; |
| (d) | Plans for supporting major facilities in the foreign investment zone; |
| (e) | Managing institution; |
| (f) | The implementer of the development project; |
| (g) | A land utilization plan and a plan for major infrastructure; |
| (h) | Specified details of land, buildings, other articles or, if any, rights to be expropriated or used; |
| (i) | Deleted; <Jul. 28, 2016> |
| (j) | Other matters prescribed by the Foreign Investment Committee; |
| 3. | The following matters when designating any area referred to in Article 18 (1) 4 of the Act as a foreign investment zone: |
| (a) | Matters provided for in subparagraph 2 (c) through (h); |
| (b) | Measures to stabilize real estate prices in the foreign investment zone and adjacent areas; |
| (c) | Measures to prevent overpopulation (limited to where the foreign investment zone is located in the over-concentration control region designated under Article 6 (1) 1 of the Seoul Metropolitan Area Readjustment Planning Act); |
| (d) | Other matters prescribed by the Foreign Investment Committee. |
| (7) | When formulating a development plan pursuant to the latter part of Article 18 (1) of the Act, the development plan and a designation plan referred to in Article 18 (3) of the Act (hereinafter referred to as "designation plan") shall be also formulated, by including the matters referred to in the subparagraphs of Article 18 (3) of the Act and the items of paragraph (6) 2 of this Decree into such development plan. <Added on Oct. 5, 2010> |
| (8) | A Mayor/ |
| (9) | The Foreign Investment Committee shall deliberate on whether to designate the relevant area as a foreign investment zone, comprehensively considering effects on the national economy, such as the feasibility of the foreign investment to be induced, balanced regional development, efficient utilization of the national territory, and employment growth based on the relevant designation plan. <Amended on Oct. 5, 2010> |
| (10) | Where the designation is deemed unnecessary after deliberation under paragraph (9), a Mayor/ |
| (11) | A foreign-invested company shall satisfy the standards referred to in paragraphs (1) and (5) according to the relevant designation plan within five years from the date of public notice under Article 18 (4) of the Act. <Amended on Oct. 5, 2010> |
| (12) | "Matters prescribed by Presidential Decree" in Article 18 (4) 5 of the Act means all of the following matters: <Amended on Oct. 5, 2010> |
| 1. | Objectives for which a foreign investment zone is designated; |
| 2. | Period for development of a foreign investment zone; |
| 3. | Qualifications for enterprises to take occupancy and categories of business to be attracted (limited to where the area referred to in Article 18 (1) 1 of the Act has been designated as a foreign investment zone); |
| 4. | Methods for perusing relevant drawings and documents (limited to where the area referred to in Article 18 (1) 1 of the Act has been designated as a foreign investment zone). |
| (13) | "Minor alterations prescribed by Presidential Decree" in the proviso of Article 18 (5) of the Act means any of the following alterations: <Amended on Oct. 5, 2010; Jun. 11, 2013; Aug. 5, 2020> |
| 1. | An alteration to the area of a foreign investment zone (limited to an alteration by up to 30/100); |
| 2. | An increase, or a decrease by up to 30/100, in the amount of foreign investment (limited to where the requirements for designation of foreign investment zones set out in Article 18 (1) of the Act are met even after such increase or decrease); |
| 3. | An alteration to the scale of employment by the relevant foreign-invested company; |
| 4. | An alteration to the main categories of business to be attracted (limited to where the area referred to in Article 18 (1) 1 of the Act has been designated as a foreign investment zone); |
| 5. | An alteration to the details of business of the relevant foreign-invested company (limited where the area referred to in Article 18 (1) 2 of the Act has been designated as a foreign investment zone); |
| 6. | Other matters determined by the Foreign Investment Committee. |
| (14) | A Mayor/ |
| (15) | Except as provided in paragraphs (1) through (14), matters necessary for the designation and development of foreign investment zones shall be determined by the Foreign Investment Committee. <Amended on Oct. 5, 2010> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 26 (Cancellation of designation of foreign investment zones) |
| (1) | Where a foreign-invested company taking occupancy in an area under Article 18 (1) 2 of the Act, designated as a foreign investment zone, or an area under Article 18 (1) 3 or 4 fails to meet the standards for designation provided for in Article 25, the competent Mayor/ |
| 1. | In cases of an area referred to in Article 18 (1) 2 of the Act: |
An order requiring that the relevant foreign-invested company meet such standards within a specified period not exceeding six months (hereinafter referred to as "implementation period"). In such cases, such implementation period may be extended only on one occasion by up to the period originally specified where it is deemed that there is any unavoidable cause;
| 2. | In cases of an area referred to in Article 18 (1) 3 or 4 of the Act: |
The relevant foreign-invested company shall meet such standards within a specified period not exceeding 6 months, after consulting with the Minister of Trade, Industry and Resources; in such cases, the competent Mayor/Do Governor may extend such implementation period only on one occasion by up to the period originally specified, after consulting with the Minister of Trade, Industry and Resources where there is any unavoidable circumstance.
| (2) | Where a foreign-invested company or a foreign investment zone still fails to meet the standards for designation within the implementation period specified under the subparagraphs of paragraph (1), the competent Mayor/ |
| (3) | Except as provided in paragraphs (1) and (2), matters necessary for cancellation of designation of foreign investment zones shall be determined by the Foreign Investment Committee. |
[This Article Wholly Amended on Jul. 30, 2009]
[Moved from Article 26-2; (Previous) Article 26 moved to Article 26-2 <Aug. 5, 2020>]
| Article 26-2 (Management of foreign investment zones) |
| (1) | The agency in charge of the management of foreign investment zones (hereafter referred to as the "management agency" in this Article) pursuant to Article 18-3 (1) of the Act shall manage the foreign investment zones in accordance with the designation plan. <Amended on Oct. 5, 2010; Aug. 5, 2020> |
| (2) | The management agency, which manages foreign investment zones in accordance with paragraph (1), shall preferentially take into account the convenience of foreign investors or foreign-invested companies and shall endeavor to render support for securing various infrastructure needed for supporting the business of the foreign-invested companies in the zones, such as financial institutions, information and communications facilities, and logistics facilities, as well as support for securing medical facilities, educational facilities, and housing. |
| (3) | Any person who intends to run a business in a foreign investment zone shall enter into an occupancy agreement (hereafter referred to as "occupancy agreement" in this Article) with the management agency; provided, a person who has ownership or a right to use a site or a building in the relevant foreign investment zone need not enter into an occupancy agreement. <Added on Aug. 5, 2020> |
| (4) | Notwithstanding paragraph (3), Article 38 of the Industrial Cluster Development and Factory Establishment Act shall apply to contracts for occupancy of a foreign investment zone designated in an industrial complex defined in subparagraph 14 of Article 2 of that Act. <Added on Aug. 5, 2020> |
| (5) | Where any person who has entered into an occupancy contract falls under any of the following subparagraphs, the management agency shall issue an order to rectify the relevant item within a specified period not exceeding six months, and if he or she fails to comply with such order within the relevant period, it may terminate the occupancy contract; provided, in cases of subparagraphs 3, 4 and 7, a contract for occupancy may be terminated immediately without a corrective order: <Added on Aug. 5, 2020; Oct. 1, 2025> |
| 1. | Where he or she fails to commence construction of such factory, etc. or to start business within a period prescribed by Decree of the Ministry of Trade, Industry and Resources without good cause after concluding an occupancy agreement; |
| 2. | Where he or she ceases to meet the requirements for occupancy; |
| 3. | Where he or she sells, leases, exchanges, or in any other way disposes of the leased site, building, or facility on his or her own discretion; |
| 4. | Where he or she is declared bankrupt pursuant to the Debtor Rehabilitation and Bankruptcy Act; |
| 5. | Where he or she suspends or closes his or her business continuously at least one year; |
| 6. | Where he or she fails to pay the rent for at least one year; |
| 7. | Where it is deemed impractical to achieve the purpose of the occupancy agreement due to violation of an Act or a material breach of the occupancy contract. |
| (6) | The management agency shall hold a hearing when it intends to terminate an occupancy agreement pursuant to paragraph (5). <Added on Aug. 5, 2020> |
| (7) | Except as provided in paragraphs (1) through (4), matters necessary for providing cash grants and other matters shall be determined by the Minister of Trade, Industry and Resources following deliberation by the Foreign Investment Committee. <Amended on Aug. 5, 2020; Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 30, 2009]
[Moved from Article 26; (Previous) Article 26-2 moved to Article 26 <Aug. 5, 2020>]
CHAPTER V FOLLOW-UP MANAGEMENT OF FOREIGN INVESTMENT
| Article 27 (Procedures for registration of foreign-invested companies) |
| (1) | A foreign investor or a foreign-invested company shall file for registration as a foreign-invested company with the Minister of Trade, Industry and Resources, as prescribed by Decree of the Ministry of Trade, Industry and Resources, within 60 days from the occurrence of the relevant ground provided for in the subparagraphs of Article 21 (1) of the Act; provided, where a foreigner who contributes to a nonprofit corporation completes his or her contribution under Article 2 (1) 4 (c) of the Act, and the nonprofit corporation fails to meet any of the standards provided for in the subparagraphs of Article 2 (6), the foreigner shall file for registration within 30 days upon meeting such standards. <Amended on Mar. 23, 2013; Jun. 11, 2013; Jul. 28, 2016; Oct. 1, 2025> |
| (2) | "When a foreign investor or foreign-invested company ... meets requirements prescribed by Presidential Decree, such as the investment amount" in Article 21 (2) of the Act means where both of the following are met: <Amended on Jul. 28, 2016> |
| 1. | The amount of investment under the main clause, with the exception of the subparagraphs, of Article 2 (2) shall be at least 100 million won; |
| 2. | A foreigner shall own at least 10/100 of either the total number of voting stocks or the total equity investment as prescribed in Article 2 (2) 1. |
[This Article Wholly Amended on Jul. 30, 2009]
[Title Amended on Jul. 28, 2016]
| Article 28 (Cancellation of registration of foreign-invested companies) |
| (1) | Pursuant to Article 21 (4) of the Act, the Minister of Trade, Industry and Resources shall examine whether any of the grounds provided in the subparagraphs of Article 21 (4) of the Act has arisen at least once a year. <Amended on Oct. 1, 2025> |
| (2) | In order to cancel registration under Article 21 (4) of the Act, the Minister of Trade, Industry and Resources shall notify the relevant foreign-invested company of such cancellation or make a public announcement thereof, as prescribed by Decree of the Ministry of Trade, Industry and Resources. <Amended on Oct. 1, 2025> |
| (3) | Upon canceling the registration of a foreign-invested company under Article 21 (4) of the Act, the Minister of Trade, Industry and Resources shall inform the Commissioner of the National Tax Service, the Commissioner of the Korea Customs Service, and the head of the local government which has supported the foreign-invested company under Chapter III of the Act of the details of such cancellation. <Amended on Oct. 1, 2025> |
| (4) | "Cases meeting the criteria prescribed by Presidential Decree" in the provisions, with the exception of the subparagraphs, of Article 21 (5) of the Act means any of the following cases: <Amended on Oct. 21, 2021> |
| 1. | In cases falling under Article 21 (5) 1 of the Act: When the foreign investment ratio is less than 10/100; |
| 2. | In cases falling under Article 21 (5) 2 of the Act: Any of the following cases: |
| (a) | Where a company, the foreign investment ratio in which is less than 50/100 and the largest stockholder of which is not a foreign investor (including specially related persons under Article 6 (1)), acquires the stocks, etc. of a domestic company; |
| (b) | Where a foreign-invested company (excluding an institutional private equity fund referred to in Article 9 (19) 1 of the Financial Investment Services and Capital Markets Act), which runs a financial business or insurance business and all or some of the business activities of which consists of acquisition of stocks, etc. of other companies pursuant to other statutes or regulations; |
| (c) | Where a foreign-invested company acquires no more than 10/100 of the total number of the stocks, etc. issued by, or the total equity investment of, a domestic company. |
[This Article Wholly Amended on Jul. 28, 2016]
| Article 29 Deleted. <Jul. 28, 2016> |
| Article 30 Deleted. <Jul. 28, 2016> |
CHAPTER VI DELETED.
| Article 31 Deleted. <Jul. 28, 2016> |
| Article 32 Deleted. <Jul. 28, 2016> |
| Article 33 Deleted. <May 24, 1999> |
CHAPTER VII SUPPLEMENTARY PROVISIONS
| Article 34 (Operation of Foreign Investment Committee) |
| (1) | Deleted. <May 24, 1999> |
| (2) | The Chairperson of the Foreign Investment Committee shall exercise general control over various business affairs of the Committee, represent the Committee, and call and preside over meetings of the Committee. Where the Chairperson is unable to perform his or her duties for any inevitable reason, a member of the Committee designated by the Chairperson shall perform such duties on behalf of the Chairperson. <Amended on Jul. 30, 2009; Jan. 5, 2021> |
| (3) | The president of the Korea Trade-Investment Promotion Agency, the foreign investment ombudsman, and the project managers may attend the meetings of the Committee and state their opinions. <Amended on Jul. 30, 2009> |
| (4) | Meetings of the Committee shall be held with the attendance of a majority of the members who are entitled to participate in said meetings, and resolutions shall be passed with the affirmative vote of a majority of those present. <Amended on Jul. 30, 2009> |
| (5) | The Committee may require relevant persons to state their opinions, if deemed necessary. <Amended on Jul. 30, 2009> |
| (6) | Where the Chairperson call a meeting of the Committee, he or she shall notify each member of the Committee of the date and time, place, and purpose of the meeting by no later than three days before the beginning of such meeting; provided, this shall not apply in an emergency. <Amended on Jul. 30, 2009> |
| (7) | A secretary shall be assigned to the Committee to handle its administrative affairs, and the secretary shall be appointed by the Minister of Trade, Industry and Resources from among public officials belonging to the Ministry of Trade, Industry and Resources. <Amended on Jul. 30, 2009; Mar. 23, 2013; Oct. 1, 2025> |
| Article 34-2 (Composition and operation of expert committees) |
| (1) | An expert committee shall be established under the Foreign Investment Committee to efficiently deliberate on whether a foreign investment constitutes a national security risk. |
| (2) | The expert committee shall be comprised of up to 20 members, including the chairperson, and the chairperson of the expert committee shall be appointed by the Minister of Trade, Industry and Resources from among public officials in general service belonging to the Senior Executive Service of the Ministry of Trade, Industry and Resources. <Amended on Oct. 1, 2025> |
| (3) | The members of the expert committee shall be the following persons: |
| 1. | Persons appointed by the head of the relevant agency from among members in general service of the Senior Executive Service of the Ministry of Economy and Finance, the Ministry of Foreign Affairs, the Ministry of National Defense, and the Financial Services Commission; |
| 2. | Persons appointed by the head of the relevant agency from among employees of the National Intelligence Service, the Korea Trade-Investment Promotion Agency, and the Korean Security Agency of Trade and Industry under Article 25 of the Foreign Trade Act; |
| 3. | Persons commissioned by the Chairperson of the Foreign Investment Committee from among persons with extensive knowledge of and experience in national defense, industrial technology, supply chains, security, statutes, etc.; |
| 4. | Other persons commissioned by the Chairperson of the Foreign Investment Committee upon the recommendation of the head of the relevant administrative agency or public institution, from among the employees of the relevant administrative agency or public institution. |
| (4) | Except as provided in paragraphs (1) through (3), matters necessary for the organization and operation of the expert committee shall be determined by the Chairperson of the Foreign Investment Committee, subject to resolution by the Foreign Investment Committee. |
[This Article Added on Aug. 27, 2024]
| Article 35 (Establishment and operation of foreign investment Working Committee) |
| (1) | Matters entrusted to a Foreign Investment Working Committee (hereinafter referred to as "Working Committee") by the Foreign Investment Committee pursuant to Article 27 (3) of the Act are as follows: <Amended on Oct. 5, 2010; Aug. 5, 2020> |
| 1. | Matters regarding the recognition of foreign investment under Article 2 (1) 4 (d) of the Act; |
| 2. | Matters regarding the alteration of designation of a foreign investment zone under Article 18 (5) of the Act and the cancellation of designation of a foreign investment zone under Article 18-2 (1) of the Act; |
| 3. | Matters regarding the establishment and operation of the Investment Support Center under Article 21 (8); |
| 4. | Matters regarding the establishment and operation of the grievance committee under Article 21-4 (8); |
| 5. | Other matters deemed necessary following deliberation by the Committee. |
| (2) | The Minister for Trade shall be the Chairperson of the Working Committee, and the following persons shall be the members thereof: <Amended on Mar. 23, 2013; Jun. 11, 2013; Jul. 26, 2017; Oct. 1, 2025> |
| 1. | A person designated, upon the request of the Minister of Trade, Industry and Resources, by a relevant Minister from among public officials in general service who are members of the Senior Executive Service in the Ministry of Trade, Industry and Resources or any other relevant Ministry; |
| 2. | A Vice-Mayor or Vice-Governor of a relevant City/ |
| 3. | The head of the Investment Support Center and the foreign investment ombudsman. |
| (3) | A secretary shall be assigned to the Working Committee to handle its administrative affairs, and the secretary shall be appointed by the Minister of Trade, Industry and Resources from among the public officials belonging to the Ministry of Trade, Industry and Resources. <Amended on Mar. 23, 2013; Oct. 1, 2025> |
| (4) | The Committee shall establish, under the jurisdiction of the Working Committee, a Foreign Investment Inducement Subcommittee with a member of the Working Committee belonging to the Ministry of Trade, Industry and Resources as its Chairperson, for the integration and management of foreign investment inducement, the encouragement and inspection of the settlement of civil petitions concerning foreign investment, and the review of the agenda of the Working Committee concerning foreign investment inducement activities. <Amended on Mar. 23, 2013; Oct. 1, 2025> |
| (5) | Except as provided in this Decree, matters necessary for the operation of the Committee, the Working Committee, and the Subcommittee shall be determined by the Chairperson of the Committee following a resolution by the Committee. |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 36 (Reporting on data on current status of foreign investment) |
| (1) | The Governor of the Bank of Korea shall integrate the current status of the outflow and inflow of foreign investment funds each month, and shall report it to the Minister of Trade, Industry and Resources by the 10th of the following month. <Amended on Mar. 23, 2013; Jul. 28, 2016; Oct. 1, 2025> |
| (2) | The Minister of Trade, Industry and Resources shall compile data on the current status of foreign investment and foreign-invested companies on a regular basis and forward such data to agencies related to foreign investment inducement. <Amended on Mar. 23, 2013; Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 37 (Disposal of capital goods) |
| (1) | Where the head of any customs office intends to sell capital goods under Article 28 (7) of the Act, he or she shall submit a list of the capital goods for sale to the Minister of Trade, Industry and Resources via the Commissioner of the Korea Customs Service. <Amended on Mar. 23, 2013; Jul. 28, 2016; Oct. 1, 2025> |
| (2) | The Minister of Trade, Industry and Resources may request the head of the relevant customs office to postpone the sale of capital goods under paragraph (1) after consulting with the head of the relevant agency. In such cases, a request to the head of a customs office shall be made within 20 days of receipt of a list of the capital goods to be sold. <Amended on Mar. 23, 2013; Oct. 1, 2025> |
| (3) | Where no request for postponement is made within the period prescribed in the latter part of paragraph (2), the head of the relevant customs office shall sell the relevant capital goods and report thereon to the Minister of Trade, Industry and Resources. <Amended on Mar. 23, 2013; Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 38 (Examination and confirmation of introduced capital goods) |
| (1) | "Capital goods which meet the criteria prescribed by Presidential Decree, such as capital goods introduced into Korea under this Act which are subject to tax reductions or exemption" in Article 29 (1) of the Act means any of the following: <Amended on Mar. 23, 2013; Jul. 18, 2023; Oct. 1, 2025> |
| 1. | Capital goods subject to exemption from customs duties, individual consumption tax, and value-added tax pursuant to Article 121-3 (1) of the Act on Restriction on Special Cases concerning Taxation; |
| 2. | Capital goods introduced into the Republic of Korea by a foreign investor as an object of investment (including contributions; hereafter in this Article the same shall apply); |
| 3. | Capital goods introduced into the Republic of Korea by a foreign-invested company using a means of international payment with investment made by a foreign investor or a means of domestic payment obtained from the exchange of the means of international payment, among the goods designated and publicly notified by the Minister of Trade, Industry and Resources under Article 11 (1) of the Foreign Trade Act. |
| (2) | Any person who intends to introduce into the Republic of Korea capital goods prescribed in the subparagraphs of paragraph (1) and goods, other than the capital goods introduced for the foreign investment as defined in Article 2 (1) 4 (c) and (d) of the Act (hereafter in this paragraph referred to as "capital goods, etc."), shall prepare a written specification of the goods, etc. to be introduced, which states their quantities, standard sizes, prices and manufacturers, and apply for the examination and confirmation thereof to the competent Minister before their import declarations are accepted under Article 241 (1) of the Customs Act. <Amended on Oct. 15, 2014; Aug. 5, 2020> |
| (3) | Notwithstanding paragraph (2), if either of the following events occurs, a person may apply for the examination and confirmation of a written specification of capital goods, etc. within the time frame classified below: <Added on Oct. 15, 2014> |
| 1. | Where the person pays customs duties pursuant to Article 39 (2) of the Customs Act: Within five days from the date of receipt of the relevant notice of payment; |
| 2. | Where the capital goods, etc. are not shipped out from the bonded area: Within 15 days from the acceptance of the relevant import declarations. |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 39 (Confirmation of completion of investment in kind) |
| (1) | Where the Commissioner of the Korea Customs Service has confirmed the completion of the investment in kind in accordance with Article 30 (3) of the Act, he or she shall, without delay, notify the Governor of the Bank of Korea. |
| (2) | "Technology evaluation agency prescribed by Presidential Decree" in Article 30 (4) of the Act means any evaluation agency referred to in the subparagraphs of Article 4 of the Enforcement Decree of the Special Act on the Promotion of Venture Businesses. <Amended on Jul. 2, 2024> |
[This Article Wholly Amended on Jul. 30, 2009]
| Article 39-2 (Prior deliberation on second-tier company’s holding stocks of joint stock corporation) |
The requirements subject to prior deliberation by the Fair Trade Commission under the latter part of Article 30 (7) of the Act shall be as follows: <Amended on Dec. 28, 2021; Jul. 18, 2023>
| 1. | The company seeking to hold stocks of a joint stock corporation with a foreigner under Article 30 (6) of the Act shall correspond to a second-tier company (referring to a second-tier company defined in subparagraph 9 of Article 2 of the Monopoly Regulation and Fair Trade Act: hereafter in this Article the same shall apply) of a general holding company defined in Article 18 (2) 5 of the Monopoly Regulation and Fair Trade Act (hereafter in this Article referred to as "general holding company"); |
| 2. | The corporation that has issued shares a second-tier company of a general holding company intends to hold with a foreigner pursuant to Article 30 (6) of the Act shall correspond to a joint stock corporation under Article 18 (1) 1 of the Monopoly Regulation and Fair Trade Act; |
| 3. | The business that a joint stock corporation under Article 30 (6) of the Act intends to carry out shall have any kind of business relevance described below with the business of a second-tier company that has control over its business contents: |
| (a) | The business shall be of making or selling products or services with products or services of the second-tier company as its major production elements; |
| (b) | The business shall be of providing raw materials, services, or other production elements required by the second-tier company; |
| (c) | The business shall be of conducting research and development concerning raw materials or services produced by the second-tier company; |
| (d) | The business shall be of making or selling products or services identical, or sharing most of the production technology, with the products or services produced by the second-tier company; |
| (e) | The business shall otherwise have close relevance with the business contents of the second-tier company; |
| 4. | The business that a joint stock corporation under Article 30 (6) of the Act intends to carry out shall have more relevance with the business of a second-tier company than with the business of a subsidiary (referring to a subsidiary defined in subparagraph 8 of Article 2 of the Monopoly Regulation and Fair Trade Act) of a general holding company, so that the second-tier company is qualified to become a stakeholder in the joint stock corporation; |
| 5. | If a joint stock corporation becomes a third-tier company of a general holding company pursuant to Article 30 (6) of the Act, a plan to dispose of all the stocks of the domestic affiliates (referring to affiliates defined in subparagraph 12 of Article 2 of the Monopoly Regulation and Fair Trade Act) owned by such joint stock corporation shall be submitted to the Fair Trade Commission by the date preceding the date of commencement of prior deliberation thereby under the latter part of Article 30 (7) of the Act. |
[This Article Added on Feb. 27, 2014]
| Article 39-3 (Re-examination of regulation) |
| (1) | The Minister of Trade, Industry and Resources shall examine the feasibility of the requirements subject to prior deliberation specified in Article 39-2 every 3 years, beginning on January 1, 2014 (meaning until the date before January 1 of every third year) and shall take measures, such as making improvements. <Amended on Oct. 1, 2025> |
| (2) | The Minister of Trade, Industry and Resources shall examine the appropriateness of the following matters every 2 years counting from each base date specified in the following (referring to the period that ends on the day before the base date of every second year) and shall take necessary measures, such as making improvements: <Amended on Aug. 5, 2020; Oct. 1, 2025> |
| 1. | Deleted; <Jul. 28, 2016> |
| 2. | Scope of the service businesses that can be designated as a foreign investment zone under Article 25 (3): January 1, 2015; |
| 3. | Standards and procedures for cancellation of designation of foreign investment zones under Article 26: January 1, 2015; |
| 4. | Deleted; <Jul. 28, 2016> |
| 5. | Deleted; <Jul. 28, 2016> |
| 6. | Deleted; <Jul. 28, 2016> |
| 7. | Deleted; <Jul. 28, 2016> |
| 8. | Deleted. <Jul. 28, 2016> |
| (3) | Deleted. <Mar. 3, 2020> |
[This Article Wholly Amended on Dec. 9, 2014]
| Article 40 (Delegation or entrustment of authority) |
| (1) | Pursuant to Article 31 of the Act, the Minister of Trade, Industry and Resources shall delegate or entrust his or her authority as classified below: <Amended on Mar. 23, 2013; Jul. 28, 2016; Oct. 1, 2025> |
| 1. | Deleted; <Jul. 28, 2016> |
| 2. | Authority prescribed in Article 28 (2) of the Act concerning investigations as to whether Article 21 (3) 2 of the Act has been violated shall be delegated to the Commissioner of the Korea Customs Service; |
| 3. | Authority prescribed in Article 28 (2) of the Act concerning investigations as to whether Article 21 (5) and (6) of the Act have been violated shall be delegated to the Commissioner of the National Tax Service; |
| 4. | Authority prescribed in Article 28 of the Act, other than those prescribed in subparagraphs 2 and 3 above, concerning the investigations into the status of implementing the terms of permission for, or details of reports by foreigners, foreign investors, and foreign-invested companies, and corrective orders therefor shall be delegated or entrusted to the competent Minister, the Commissioner of the National Tax Service, or the Commissioner of the Korea Customs Service according to their jurisdictions. |
| (2) | Pursuant to Article 31 of the Act, the Minister of Trade, Industry and Resources shall entrust his or her authority over the following affairs to the president of the Korea Trade-Investment Promotion Agency (including the heads of the trade-centers, branches, and offices designated by the president of the Korea Trade-Investment Promotion Agency; hereinafter the same shall apply) and the head of a foreign exchange bank (including the heads of such branches of the foreign exchange bank as designated by the head of the foreign exchange bank; hereinafter the same shall apply): <Amended on Mar. 23, 2013; Jul. 28, 2016; Oct. 1, 2025> |
| 1. | Receipt of reports on, and modifications to, foreign investment and the issuance of certificates of completion of reports under Article 5 of the Act; |
| 2. | Registration, and registration of alteration, of foreign-invested companies under Article 21 (1) through (3) of the Act; |
| 3. | Verification of grounds for cancellation of registration of foreign-invested companies under Article 21 (4) of the Act; |
| 4. | Notification of details of applications for registration of alteration under Article 22 (1) of the Act; |
| 5. | Notification or public announcement of cancellation of registration under Article 28 (2) and (3) to foreign-invested companies and the Commissioner of the National Tax Service. |
| (3) | The competent Minister shall entrust business matters concerning the examination and confirmation under Article 38 (2) to the head of a foreign exchange bank and the president of the Korea Trade-Investment Promotion Agency. |
| (4) | Pursuant to Article 31 of the Act, a Mayor/ |
| (5) | People who have been delegated or entrusted under paragraphs (1) and (2) shall notify, or report on, the results of performing such delegated or entrusted affairs to the Minister of Trade, Industry and Resources; persons who have been entrusted under paragraph (3) to the competent Minister; and persons who have been entrusted under paragraph (4) to the competent Mayor/ |
| (6) | The Minister of Trade, Industry and Resources may determine details necessary for performing business affairs delegated or entrusted under paragraphs (1) through (3). <Amended on Mar. 23, 2013; Oct. 1, 2025> |
[This Article Wholly Amended on Jul. 30, 2009]
CHAPTER VIII ADMINISTRATIVE FINES
| Article 41 (Criteria for imposition of administrative fines) |
Standards for imposition of administrative fines under Article 37 of the Act shall be as specified in Appendix 6.
[This Article Wholly Amended on Jul. 30, 2009]
ADDENDA <Presidential Decree No. 15931, Nov. 14, 1998>
Article 1 (Enforcement date)
This Decree shall enter into force on November 17, 1998.
Article 2 (Repeal of other statutes and regulations)
The Enforcement Decree of the Foreign Investment and Foreign Capital Inducement Act is hereby repealed.
Article 3 (Applicability to designation of foreign investment zones)
| (1) | The provisions of Article 25 (1) 1 (d) and 2 shall apply to foreign investments reported on or after the date this Decree enters into force. |
| (2) | The provisions of Article 25 (1) 2 shall apply only to foreign investments reported by December 31, 2003 and the payment of which is completed by December 31, 2005. <Amended on Feb. 23, 2000; Feb. 24, 2001> |
Article 4 (Transitional measures concerning public announcement of provisions concerning restrictions on foreign investment)
Notwithstanding the provisions of Article 5 (2), the head of a relevant administrative agency shall make a public announcement to the Minister of Finance and Economy of the contents of the provisions restricting foreign investment within one month after this Decree enters into force, and the Minister of Finance and Economy shall integrate the notified details and issue public notice of the consolidated contents thereof within two months after this Decree enters into force.
Article 5 (Relationship to other statutes and regulations)
Where other statutes and regulations contain, at the time this Decree enters into force, a citation of such provisions as relate to foreign investment among the previous Enforcement Decree of the Foreign Investment and Foreign Capital Inducement Act and the previous Enforcement Decree of the Foreign Capital Inducement Act, and where there are provisions corresponding to those cited in this Decree, those statutes and regulations shall be regarded as having cited the corresponding provisions of this Decree.
ADDENDA <Presidential Decree No. 16330, May 24, 1999>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 6 Omitted.
ADDENDUM <Presidential Decree No. 16583, Oct. 27, 1999>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 16720, Feb. 23, 2000>
| (1) | (Enforcement Date) This Decree shall enter into force on the date of its promulgation. |
| (2) | (Applicability for Designation of Foreign Investment Zone) The amendments to Article 25 (1) 2 shall apply to foreign investments with respect to which the designation plan is submitted in accordance with Article 25 (2) on or after the date this Decree enters into force. |
ADDENDUM <Presidential Decree No. 17135, Feb. 24, 2001>
This Decree shall enter into force on the date of its promulgation; provided, the amendments to the proviso of Article 2 (2) shall enter into force three months after the date of its promulgation.
ADDENDA <Presidential Decree No. 17137, Feb. 24, 2001>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 7 Omitted.
ADDENDA <Presidential Decree No. 17474, Dec. 31, 2001>
| (1) | (Enforcement Date) This Decree shall enter into force on January 1, 2002. |
| (2) | (Applicability to Rental Fee of State or Public Property) The amended provisions of Article 19 (3) shall begin to apply to foreign investments reported after the date this Decree enters into force. |
| (3) | (Applicability to Requirements for Designation of Foreign Investment Zone) The amended provisions of Article 25 (1) 1 through 3 shall begin to apply to foreign investments reported after the date this Decree enters into force. |
ADDENDA <Presidential Decree No. 17686, Jul. 27, 2002>
| (1) | (Enforcement Date) This Decree shall enter into force on July 27, 2002. |
| (2) | Omitted. |
| (3) | Omitted. |
ADDENDA <Presidential Decree No. 17851, Dec. 30, 2002>
| (1) | (Enforcement Date) This Decree shall enter into force on January 1, 2003. |
| (2) | (Applicability to Designation of Foreign Investment Zones) The amended provisions of Article 25 (1) 1 (a) and 4 shall begin to apply to foreign investments reported after the date when this Decree enters into force. |
ADDENDA <Presidential Decree No. 18039, Jun. 30, 2003>
Article 1 (Enforcement date)
This Decree shall enter into force on July 1, 2003.
Articles 2 through 6 Omitted.
ADDENDA <Presidential Decree No. 18222, Jan. 13, 2004>
| (1) | (Enforcement Date) This Decree shall enter into force on the date of its promulgation; provided, the amended provisions of Article 25 (1) 3 (b) shall enter into force on February 1, 2004. |
| (2) | (Applicability of Reduction of or Exemption from Rents for Foreign-Invested Companies) The amended provisions of Article 19 (4) 2 shall begin to apply to the first application for reduction of or exemption from the rent first filed after this Decree enters into force. |
| (3) | (Applicability of Foreign Investment Zone) The amended provisions of Article 25 shall begin to apply to a report first made on foreign investment after this Decree enters into force. |
ADDENDA <Presidential Decree No. 18343, Mar. 29, 2004>
Article 1 (Enforcement date)
This Decree shall enter into force on March 30, 2004.
Article 2 Omitted.
Article 3 Omitted.
Article 4 Omitted.
ADDENDUM <Presidential Decree No. 18662, Dec. 31, 2004>
This Decree shall enter into force on January 1, 2005.
ADDENDA <Presidential Decree No. 18736, Mar. 8, 2005>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 19321, Feb. 8, 2006>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 19513, Jun. 12, 2006>
Article 1 (Enforcement date)
This Decree shall enter into force on July 1, 2006.
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 19639, Aug. 4, 2006>
Article 1 (Enforcement date)
This Decree shall enter into force on August 5, 2006.
Articles 2 through 6 Omitted.
ADDENDUM <Presidential Decree No. 19826, Jan. 5, 2007>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 20257, Sep. 10, 2007>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Article 2 Omitted.
Article 3 Omitted.
Article 4 Omitted.
ADDENDA <Presidential Decree No. 20258, Sep. 10, 2007>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Article 2 Omitted.
Article 3 Omitted.
Article 4 Omitted.
ADDENDA <Presidential Decree No. 20289, Sep. 27, 2007>
Article 1 (Enforcement date)
This Decree shall enter into force on September 28, 2007.
Articles 2 through 4 Omitted.
Article 5 Omitted.
Article 6 Omitted.
ADDENDA <Presidential Decree No. 20290, Sep. 27, 2007>
Article 1 (Enforcement date)
This Decree shall enter into force on September 28, 2007.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 20331, Oct. 23, 2007>
Article 1 (Enforcement date)
This Decree shall enter into force on October 28, 2007. (Proviso Omitted.)
Article 2 Omitted.
Article 3 Omitted.
ADDENDUM <Presidential Decree No. 20344, Oct. 26, 2007>
This Decree shall enter into force on October 28, 2007.
ADDENDA <Presidential Decree No. 20516, Dec. 31, 2007>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 2008.
Articles 2 through 5 Omitted.
Article 6 Omitted.
Article 7 Omitted.
ADDENDUM <Presidential Decree No. 20646, Feb. 22, 2008>
This Decree shall enter into force on the date of its promulgation; provided, the amended provisions of Article 5 shall enter into force three months after the date of its promulgation.
ADDENDA <Presidential Decree No. 20678, Feb. 29, 2008>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 6 Omitted.
Article 7 Omitted.
ADDENDA <Presidential Decree No. 20947, Jul. 29, 2008>
Article 1 (Enforcement date)
This Decree shall enter into force on February 4, 2009. (Proviso Omitted.)
Articles 2 through 25 Omitted.
Article 26 Omitted.
Articles 27 and 28 Omitted.
ADDENDA <Presidential Decree No. 21098, Oct. 29, 2008>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 21181, Dec. 24, 2008>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 2009.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 21182, Dec. 24, 2008>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 2009.
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 21214, Dec. 31, 2008>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 4 Omitted.
Article 5 Omitted.
ADDENDA <Presidential Decree No. 21515, May 29, 2009>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 21590, Jun. 30, 2009>
Article 1 (Enforcement date)
This Decree shall enter into force on July 1, 2009; provided, the amended provisions of Articles 8 and 9 shall enter into force on January 1, 2010.
Articles 2 through 9 Omitted.
ADDENDA <Presidential Decree No. 21641, Jul. 27, 2009>
Article 1 (Enforcement date)
This Decree shall enter into force on July 31, 2009. (Proviso Omitted.)
Articles 2 through 13 Omitted.
Article 14 Omitted.
Article 15 Omitted.
ADDENDA <Presidential Decree No. 21657, Jul. 30, 2009>
Article 1 (Enforcement date)
This Decree shall enter into force on July 31, 2009.
Article 2 (Applicability)
The amended provisions of Article 29 (2) 2 (b) shall begin to apply to the acquisition of stocks, etc. of other companies by a private equity fund first made after this Decree enters into force.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 21719, Sep. 9, 2009>
Article 1 (Enforcement date)
This Decree shall enter into force on September 10, 2009.
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 21882, Dec. 14, 2009>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 5 Omitted.
Article 6 Omitted.
Article 7 Omitted.
ADDENDA <Presidential Decree No. 21918, Dec. 30, 2009>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 2010. (Proviso Omitted.)
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 22073, Mar. 9, 2010>
Article 1 (Enforcement date)
This Decree shall enter into force on March 10, 2010. (Proviso Omitted.)
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 22224, Jun. 28, 2010>
Article 1 (Enforcement date)
This Decree shall enter into force on July 1, 2010.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 22426, Oct. 5, 2010>
Article 1 (Enforcement date)
This Decree shall enter into force on October 6, 2010.
Article 2 (Transitional measures for foreign investment amount)
Notwithstanding the amended provisions of Article 2 (2) concerning foreign investment amount, the previous provisions shall apply to foreign investment reported as at the time this Decree enters into force.
Article 3 (Applicability to capitalization of earned surplus reserve)
The amended provisions of Article 2 (3) shall begin to apply to reporting first made on foreign investment after this Act enters into force.
ADDENDA <Presidential Decree No. 22815, Apr. 1, 2011>
Article 1 (Enforcement date)
This Decree shall enter into force on April 1, 2011.
Articles 2 through 9 Omitted.
Article 10 Omitted.
ADDENDA <Presidential Decree No. 23297, Nov. 16, 2011>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Article 2 Omitted.
ADDENDA <Presidential Decree No. 23993, Jul. 26, 2012>
Article 1 (Enforcement date)
This Decree shall enter into force on July 27, 2012.
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 24442, Mar. 23, 2013>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 11 Omitted.
Article 12 Omitted.
ADDENDA <Presidential Decree No. 24502, Apr. 22, 2013>
Article 1 (Enforcement date)
This Decree shall enter into force on April 24, 2013.
Article 2 Omitted.
Article 3 Omitted.
Article 4 Omitted.
ADDENDA <Presidential Decree No. 24585, Jun. 11, 2013>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation; provided, the amended provisions of Article 19, 21-3 (5) through (7), 21-4 (2), 35 (2) 2, and Appendix 6 shall enter into force on June 12, 2013.
Article 2 (Applicability to notification of handling results)
The amended provisions of Article 21-3 (5) shall begin to apply to a recommendation to take corrective measures from the foreign investment ombusman on or after the date this Decree enters into force.
Article 3 (Applicability to designation of foreign investment zones)
The amended provisions of Article 25 (1) shall begin to apply to an application for designation of a foreign investment zone filed on or after the date this Decree enters into force.
ADDENDA <Presidential Decree No. 24638, Jun. 28, 2013>
Article 1 (Enforcement date)
This Decree shall enter into force on July 1, 2013.
Articles 2 through 15 Omitted.
Article 16 Omitted.
Article 17 Omitted.
ADDENDUM <Presidential Decree No. 25221, Feb. 27, 2014>
This Decree shall enter into force on March 11, 2014.
ADDENDA <Presidential Decree No. 25249, Mar. 11, 2014>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 25476, Jul. 16, 2014>
Article 1 (Enforcement date)
This Decree shall enter into force on July 31, 2014.
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 25655, Oct. 15, 2014>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation; provided, the amended provisions of subparagraph 48 of Appendix 5 (limited to the matters relating to the licensing of operating research reactors, etc.) shall enter into force on November 22, 2014.
Article 2 (Applicability to rates of reduction or exemption of rents)
The amended provisions of Article 19 (6) 1 (d) and (7) 1 shall apply with regard to the conclusion of a lease contract or renewal contract made after this Decree enters into force.
Article 3 (Applicability to exemption from duty to report in case of disposal of capital goods subject to tax reduction or exemption)
| (1) | The amended provisions of Article 29 (1) 1 and 2 shall also apply where a person has obtained the approval or confirmation of the head of the relevant customs office under Article 108 (4) or 109 (1) of the Customs Act before this Decree enters into force. |
| (2) | The amended provisions of Article 38 (3) 1 shall apply where a person receives a notice of payment under Article 39 (3) of the Customs Act on or after the date this Decree enters into force. |
| (3) | The amended provisions of Article 38 (3) 2 shall apply where import declarations have been accepted under Article 241 (1) of the Customs Act before this Decree enters into force. |
Article 4 (Transitional measures for cash grants for local headquarters)
Notwithstanding the amended provisions of Article 20-2 (4) 1, the former provisions shall apply with regard to the local headquarters to which cash grants have been awarded under former Article 20-2 (4) 1 as at the time this Decree enters into force.
Article 5 (Transitional measures for designation of foreign investment zone of research facilities)
Notwithstanding the amended provisions of Article 25 (1) 4, the former provisions shall apply with regard to the research facilities designated as a foreign investment zone under former Article 25 (1) 4 as at the time this Decree enters into force.
ADDENDA <Presidential Decree No. 25840, Dec. 9, 2014>
Article 1 (Enforcement date)
This Decree shall enter into force on Jan. 1, 2015.
Articles 2 through 16 Omitted.
ADDENDA <Presidential Decree No. 26205, Apr. 20, 2015>
Article 1 (Enforcement date)
This Decree shall enter into force on Apr. 29, 2015.
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 26600, Oct. 23, 2015>
Article 1 (Enforcement date)
This Decree shall enter into force on Oct. 25, 2015. (Proviso Omitted.)
Articles 2 through 8 Omitted.
Article 9 Omitted.
ADDENDUM <Presidential Decree No. 26803, Dec. 30, 2015>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 27406, Jul. 28, 2016>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Applicability to reduction of, or exemption from, rents for public property)
The amended Article 19 (11) shall apply, beginning with a lease contract concluded or renewed after this Decree enters into force.
Article 3 (Transitional measures concerning definitions of foreign investment)
Any foreign investment reported or permitted under the former provisions before this Decree enters into force shall be deemed a foreign investment that complies with the amended Article 2 (2) 2, (6), and (7).
ADDENDA <Presidential Decree No. 27751, Dec. 30, 2016>
Article 1 (Enforcement date)
This Decree shall enter into force on January 1, 2017. (Proviso Omitted.)
Articles 2 through 12 Omitted.
ADDENDA <Presidential Decree No. 27793, Jan. 17, 2017>
Article 1 (Enforcement date)
This Decree shall enter into force on January 20, 2017.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 27972, Mar. 29, 2017>
Article 1 (Enforcement date)
This Decree shall enter into force on March 30, 2017.
Articles 2 through 8 Omitted.
Article 9 Omitted.
Article 10 Omitted.
ADDENDA <Presidential Decree No. 28212, Jul. 26, 2017>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 29172, Sep. 18, 2018>
Article 1 (Enforcement date)
This Decree shall enter into force on September 21, 2018.
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 30170, Oct. 29, 2019>
Article 1 (Enforcement date)
This Decree shall enter into force on November 1, 2019.
Article 2 Omitted.
Article 3 Omitted.
ADDENDUM <Presidential Decree No. 30509, Mar. 3, 2020>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 30586, Mar. 31, 2020>
Article 1 (Enforcement date)
This Decree shall enter into force on April 1, 2020. (Proviso Omitted.)
Articles 2 through 8 Omitted.
Article 9 Omitted.
Article 10 Omitted.
ADDENDA <Presidential Decree No. 30876, Jul. 28, 2020>
Article 1 (Enforcement date)
This Decree shall enter into force on July 30, 2020.
Articles 2 through 13 Omitted.
Article 14 Omitted.
Article 15 Omitted.
ADDENDA <Presidential Decree No. 30918, Aug. 5, 2020>
ADDENDUM <Presidential Decree No. 31380, Jan. 5, 2021>
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
ADDENDA <Presidential Decree No. 31576, Mar. 30, 2021>
Article 1 (Enforcement date)
This Decree shall enter into force on April 1, 2021. (Proviso Omitted.)
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 31741, Jun. 8, 2021>
ADDENDUM <Presidential Decree No. 31811, Jun. 22, 2021>
This Decree shall enter into force on June 23, 2021.
ADDENDA <Presidential Decree No. 32091, Oct. 21, 2021>
Article 1 (Enforcement date)
This Decree shall enter into force on October 21, 2021.
Articles 2 through 5 Omitted.
Article 6 Omitted.
ADDENDA <Presidential Decree No. 32274, Dec. 28, 2021>
Article 1 (Enforcement date)
This Decree shall enter into force on December 30, 2021.
Articles 2 through 12 Omitted.
Article 13 Omitted.
Article 14 Omitted.
ADDENDA <Presidential Decree No. 32733, Jun. 28, 2022>
Article 1 (Enforcement date)
This Decree shall enter into force on June 29, 2022.
Article 2 Omitted.
Article 3 Omitted.
Article 4 Omitted.
ADDENDA <Presidential Decree No. 33621, Jul. 7, 2023>
Article 1 (Enforcement date)
This Decree shall enter into force on July 10, 2023.
Articles 2 through 11 Omitted.
Article 12 Omitted.
Articles 13 and 14 Omitted.
ADDENDA <Presidential Decree No. 33635, Jul. 18, 2023>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Transitional measures concerning businesses eligible for reduction of, or exemption from, rent for State property)
Notwithstanding the amended provisions of Article 19 (6) 1 (b), the previous provisions shall apply to the reduction of or exemption from a rent for State property for the business for which a decision of tax reduction or exemption has been made before this Decree enters into force.
ADDENDA <Presidential Decree No. 33899, Dec. 5, 2023>
Article 1 (Enforcement date)
This Decree shall enter into force on December 14, 2023.
Article 2 Omitted.
ADDENDA <Presidential Decree No. 34488, May 7, 2024>
Article 1 (Enforcement date)
This Decree shall enter into force on May 17, 2024.
Articles 2 through 5 Omitted.
ADDENDA <Presidential Decree No. 34491, May 7, 2024>
Article 1 (Enforcement date)
This Decree shall enter into force on May 17, 2024.
Article 2 Omitted.
Article 3 Omitted.
ADDENDA <Presidential Decree No. 34657, Jul. 2, 2024>
Article 1 (Enforcement date)
This Decree shall enter into force on July 10, 2024. (Proviso Omitted.)
Article 2 Omitted.
Article 3 Omitted.
ADDENDUM <Presidential Decree No. 34859, Aug. 27, 2024>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 34936, Oct. 8, 2024>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation. (Proviso Omitted.)
Article 2 Omitted.
ADDENDA <Presidential Decree No. 35716, Aug. 26, 2025>
Article 1 (Enforcement date)
This Decree shall enter into force on August 28, 2025.
Article 2 Omitted.
ADDENDA <Presidential Decree No. 35803, Oct. 1, 2025>
Article 1 (Enforcement date)
This Decree shall enter into force on the date of its promulgation; provided, the part that amends a Presidential Decree, which is promulgated before this Decree enters into force whose enforcement date has not yet arrived from among the Presidential Decrees amended under Article 6 of Addenda, shall enter into force on the enforcement date of the relevant Presidential Decree, respectively.
Articles 2 through 5 Omitted.
Article 6 Omitted.