Setting up a Business in South Korea

Overview by Globlatrade.net:

Legal Forms of Companies

Types of Companies and Capital (Max/Min) Number of Partners/Shareholders and Liability Registration Fees
Yuhan Hoesa is a Private Limited Company.
 
 
10 million won
Minimum 2 partners. Maximum 50 partners.
 
 
Liability is limited to the amount contributed.
Lower expenses as compared to a Chusik hoesa.
Chusik hoesa is a Public Limited Company.
 
 
50 million won
Minimum 7 partners on registration, then this number can be reduced to 1.
 
 
Liability is limited to the amount contributed.
About 2,4% of the capital in Seoul, Pusan, Taegu and Inchon. For other cities, about 0,48%.
Hapcha Hoeasa is a limited partnership
 
 
No minimum capital.
Two types of partners: the active partners and the sleeping partner
 
 
Liability of active partners is unlimited. Liability of sleeping partners is limited to the amount contributed when they do not take part in the company management.
Lower costs than those for Chusik hoesa.
Hapmyung Hoesa is a general partnership.
 
 
No minimum capital.
Maximum 2 partners.
 
 
Liability is unlimited.
Lower expenses as compared to a Chusik hoesa.
 
 

Business Setup Procedures

Administrative Formalities
The administrative formalities depend on the structure created (Company, Sole Proprietorship, Branch office, Liaison Office, etc.)

 

More information on Invest Korea and Seoul website.

The Competent Organization
- The Supreme Court
- The Tax office having jurisdiction over the head office
- Invest Korea
Time Necessary for Registration
It takes around 15 days and 2 month according to the type of companies.
 

Recovery Procedures

Principle
The insolvency of a company does not lead immediately to bankruptcy or liquidation. As there are the reorganization proceedings and the liquidation proceedings.

The reorganization proceedings is to seek maintenance and rehabilitation of business entities under the supervision of the court, by adjusting the claims and equities of the entities concerned, such as creditors and equity.

Minimum Debt-to-Capital Ratio Triggering Liquidation
None
Bankruptcy Laws
The Act on the Reorganization and Liquidation of a debtor (=Debtor rehabilitation and Bankruptcy Act).
Reorganization and Rehabilitation Laws
The Act on the Reorganization and Liquidation of a debtor (=Debtor rehabilitation and Bankruptcy Act).

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