Recently, a foreign corporation invested in an existing Korean corporation and invited a couple, who are co-representatives of the foreign corporation, on D8 visas.
For D8 visas applied for by investing an amount between 100 million and less than 300 million won in a domestic corporation, it is more common for foreign individuals to invest in their own name than for foreign corporations to invest directly. Also, it's more common for foreign investors to establish a new domestic corporation in Korea, appointing themselves as the CEO, and invest the funds into this corporation than investing in an already established domestic corporation.
The overall process and specific steps for individuals investing and applying for D8 visas can be found in the link below ↓
Today, we will look at the general procedures for when a foreign corporation invests in a domestic corporation, and compare how it differs from when an individual invests.
Although the overall process does not change significantly when the investing party is a corporation rather than an individual, the required documents and the process might slightly vary.
The foreign investment declaration must obviously be made in the name of the foreign corporation (the foreign investor being the foreign corporation), and both the sender and recipient of the funds must be the foreign corporation's name.
Subsequently, the procedure is divided into two cases
1. Investing in an already established domestic corporation (possible for individuals)
2. A foreign corporation establishing another domestic corporation in Korea to invest (when a foreign company establishes a local subsidiary and invests)
※ For case 1, the business name or designation at the time of foreign investment declaration must be that of an already established domestic corporation.
For case 1, there are two possible methods
① Direct transfer from the foreign corporation's account to the domestic corporation's account and then increase capital (the bank will handle the currency exchange).
② Receive a transfer to a virtual account under the foreign corporation's name, exchange currency, and then make a capital increase by depositing into the domestic corporation's account.
※ Although both ① and ② are possible methods, usually the ② method is used.
※ In this case, the foreign corporation invested an amount close to 2.6 billion won in an already established domestic corporation. Regardless of the investment amount, the capital contribution must be made according to the declared investment amount. However, the capital increase does not necessarily have to be the exact declared investment amount. As long as the capital is over 100 million won, it can be treated as surplus capital.
After receiving the foreign investment company registration certificate, apply for a D8 visa.
Next is case 2.
In the case of 2, the remittance is received into a virtual account in the name of the foreign corporation that has filed the investment report. After that, capital payment must be made immediately, but it is not possible because there is no corporate account as the registration has not been completed yet. Therefore, in such cases, the capital payment is first made at the bank where the foreign investment report was filed, and then a capital payment (custody) certificate is issued to proceed with the corporate registration.
Since this is a case of a corporation establishing another corporation, the documents required for registration are naturally different compared to when it is an individual and also whether ① the foreign corporation is establishing another domestic corporation in Korea (foreign corporation establishing a local corporation in Korea) or ② setting up a domestic branch office (branch) changes the required documents again
The subsequent procedures are the same as when an individual makes an investment.
After the corporate registration, a business registration certificate is issued, and a foreign investment enterprise registration certificate is obtained to apply for a D8 visa.
Here's a pause!!
Setting up a domestic branch office (branch) under ② is a procedure that follows after filing a report for the establishment of a foreign company's domestic branch, not a foreign investment report, and when inviting dispatched employees, they are not subject to the D8 visa but to the D7 visa.
Most foreign companies that we commonly know as ○○○KOREA, surprisingly, pertain to cases where the foreign corporation has established another domestic corporation in Korea (a local corporation of a foreign company) and are subject to the D8 visa. Moreover, such companies called foreign investment companies are indeed domestic corporations established through the procedure after the foreign corporation filed a foreign investment report. This is completely different in nature from the branches (sales offices) established by a foreign corporation in Korea.
※ A domestic branch (branch (sales office), liaison office) of a foreign corporation is still considered a foreign corporation even if it is established in Korea.
Below is information about the differences between a foreign investment enterprise (a domestic corporation established by a foreign corporation) and a domestic branch (branch (sales office), liaison office) of a foreign company.
Lastly, we will slightly clarify the concept regarding the differences between when an individual invests and when a corporation invests from a big picture perspective.
Firstly, investing as an individual is closer to the concept of a business visa.
And in the case of individuals, rather than investing large amounts, it is more common to invest amounts less than 300 million won. Therefore, the documents submitted also focus on proving the source of investment funds and the authenticity (expertise) of the business.
Next is the case of a corporation investing.
Although it is a business visa, it is closer to the concept of a dispatch visa.
herefore, when applying for a D8 visa in the case of a corporation investing, a dispatch order and a certificate of employment from the head office or the investing company (foreign corporation) must be attached. It is the same even if the representative of the investing company (foreign corporation) comes on dispatch. The corporate representative must issue their own dispatch order and certificate of employment to attach.
And the dispatched employees who can be invited are only employees from the head office or affiliated companies, and the number of dispatched employees that can be invited is one person per 100 million won of foreign investment amount stated on the foreign investment enterprise registration certificate. And
① One person per 100 million won of annual tax payment
② One person per 1 billion won of annual sales
③ One person for every three nationals employed for at least 6 months
④ One person per 1 billion won of domestic equipment investment can be the basis for inviting additional dispatched employees.
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