Types of Companies in Korea

Discover below the types of companies you can choose from in Korea. Once you have understood their characteristics, you can rely on our local specialists for support in registering the entity that matches your interest the best.

What are the types of companies I can set up in South Korea?

You can register:

• a sole trader;
• a private limited liability company;
• a public or joint stock company;
• a limited company;
• a limited partnership;
• a general partnership.

NOTE: Out of these types of Korean business forms, only limited companies have a legal personality.

What business forms can I choose if I want to expand a foreign business in Korea?

You can choose one of the following:

• the branch office;
• the subsidiary;
• the liaison or representative office.

You can rely on our experts in company formation in Korea for detailed additional information on the legal structures available in this country.

What are the features of a Korean sole proprietorship?

The sole trader is the simplest business form in South Korea. It can be setup by an individual who will work along and who will be fully responsible for the debts and obligations of the enterprise.

Foreign citizens can also work as self-employed individuals in Korea AFTER obtaining residence permits.

What are the requirements to open a private limited liability company in Korea?

With a minimum number of one shareholder and one director, it can be set up in approximately 4 weeks. When created by local entrepreneurs, there is no minimum share capital these must draft.

When established by foreign investors seeking to have sole ownership, at least KRW 100 million or approximately USD 82,000 is required. They must also apply for residence permits if they want to move and stay in Korea.

In which cases can I register a joint stock company in Korea?

Suitable for various types of operations, the Korean joint stock company is usually employed for stock exchange trading activities, as its shares can be freely transferred to the public. There are no special requirements to meet when opening this type of company in Korea, however, it is advisable to discuss with our local specialists about how to incorporate it.

What are the main features of partnerships in South Korea?

Both types of partnerships in Korea require at least 2 members. The distinction between the two business entities is the liability of the partners as follows:

• in the general partnership, both members are equally liable for the obligations of the business and have the same benefits;
• in the limited partnership, the general partner has unlimited liability for the obligations of the business and also has decision-making powers, while the silent party’s responsibility is limited to his contribution in the enterprise.

What are the main features of a subsidiary in Korea?

The subsidiary is an independent business form, which can be registered as a private limited company. It is fully independent from the parent company, which means it can undertake various types of activities in South Korea.

What are the characteristics of a Korean branch office?

The branch office is an extension of a foreign company in Korea; therefore, it does not have its own legal status. It is limited to carrying out the same activities as the parent business, which is also liable for the obligations of the branch.

When can I set up a liaison office in Korea?

The representative office is an option if you want to test the market before starting any commercial activity. This business form does not have a legal status and can only be used to promote and complete feasibility studies on behalf of the parent company.

What is the most popular type of company in Korea?

The joint stock company is the most common business form in Korea, compared to other jurisdictions.

Please feel free to contact our specialists in company formation in Korea, to further help you register your business and choose and adequate legal structure.