AI-powered solutions to navigate and access Korea's startup funding programs
Korea is open to foreign founders. You can own 100% of a Korean company, access government grants, and apply for a business visa, but the registration process involves several distinct steps across multiple government agencies and the order matters. Here's how it works.
The two most relevant structures for foreign founders are the Joint Stock Company (주식회사) and the Private Limited Company (유한회사).
The Joint Stock Company (주식회사) is the most common type of company in Korea, accounting for 93% of all companies, including foreign-invested ones. It's the structure most investors and government programs expect, and it's the one you'll want if you're planning to raise venture capital. Many investors, especially venture capitalists, require the business to take a joint stock company form because a private limited company can't issue stock.
The Private Limited Company (유한회사) is often the preferred choice for foreign investors and SMEs seeking a private, flexible, and minimally regulated structure. It has fewer governance requirements, no mandatory board of directors or external auditor and less stringent disclosure obligations. It's a reasonable choice if you're early-stage, bootstrapped, and not yet seeking outside investment.
For most founders building a startup with grant funding or VC ambitions in mind, the Joint Stock Company (주식회사) is the safer long-term bet.
Before any money moves, you need to notify a designated Foreign Exchange Bank (외국환은행) of your intent to invest. Required documents are straightforward: an FDI notification form and a copy of your passport. Processing is typically done on the spot.
This step is what qualifies you to be classified as a Foreign Direct Investment (FDI) company, which unlocks additional protections and benefits under Korean law, including eligibility for the D-8 business investment visa.
To qualify as a foreign-invested company, the investment amount must be at least ₩100 million KRW per investor, representing at least 10% of the company's newly issued or existing shares with voting rights. You can incorporate with less, but that investment won't be recognized as FDI and the associated benefits won't apply.
After filing the notification, your investment capital needs to be transferred into a temporary share subscription account at a Korean Foreign Exchange Bank. You can do this via overseas remittance, the capital is converted to KRW and deposited into a temporary account, or by physically carrying it through customs, in which case it must be declared and accompanied by a Foreign Exchange Declaration Certificate.
Once the funds are deposited, the bank issues a capital certificate, which you'll need for the next step.
Your company name must be checked for availability and reserved through the Supreme Court's online registry system. The name must be unique and should not infringe upon existing trademarks or company names. It also needs to include the appropriate suffix (주식회사 or 유한회사) designating its legal structure.
This can be done online and is relatively quick, but it's worth doing early since a name conflict can delay everything downstream.
This is typically the most document-heavy stage. You'll need to prepare articles of incorporation outlining your company's governance structure and shareholder rights. Foreign documents, such as a power of attorney or board resolutions, usually need notarization and apostille or consular legalization, along with an official Korean translation.
The specific documents required vary depending on your structure and whether shareholders and directors are Korean nationals or foreigners residing inside or outside Korea. Getting this stage right matters, and errors here are the most common source of delays.
After court registration, you need to register with the National Tax Service (NTS) to obtain a business registration number (사업자등록번호) and, if applicable, VAT registration. You'll receive a business registration certificate (사업자등록증) which is what you'll use to sign contracts, issue tax invoices, and operate legally day-to-day.
After court registration, you need to register with the National Tax Service (NTS) to obtain a business registration number (사업자등록번호) and, if applicable, VAT registration. Register the company with the district tax office and obtain a business registration certificate (사업자등록증). This certificate is what you'll use to sign contracts, issue tax invoices, and operate legally day-to-day.
This is an additional step specific to foreign founders. After incorporation, you register officially as a foreign-invested company with the relevant authorities. This formalizes your FDI status and is required to access associated benefits, including the D-8 visa application.
Opening a corporate bank account adds another three to four weeks, as banks require all registration documents and can be strict with approvals. Some banks require the representative director to appear in person. This is worth planning for if you're not yet based in Korea full-time.
Once the account is open, your initial capital is transferred out of the temporary subscription account and into the company account, and you're operational.
A full foreign-invested corporation typically takes four to eight weeks to complete. Bank account opening adds time on top of that. Budget two to three months end-to-end if you're starting from scratch.
Janie Baek
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