Korea

56
Country starter pack
Business practicalities in Korea
Restrictions and prohibitions on foreign investment:
Foreigners are restricted from foreign investment in
the following cases: where it threatens the maintenance
of national safety and public order; where it has
harmful effects on public hygiene or the environmental
preservation or is against Korean morals and customs;
and where it violates the Acts and subordinate statutes
of the Republic of Korea. Furthermore, out of a total of
1,145 categories of business under the Korean Standard
Industrial Classification (KSIC), foreign investment
is not permitted in 60 categories, including public
administration, diplomacy, national defence, nuclear
power generation, radio broadcasting, and terrestrial
television broadcasting. Although foreigners can invest in
all of the remaining 1,085 investment categories, 29 of
them are subject to foreign ownership ceilings. Foreign
ownership ceilings and additional criteria are updated by
the Ministry of Trade, Industry and Energy through its
Integrated Public Notice of Foreign Investment.
Foreign Investment Restricted Categories (issued on April 26, 2012):
Business Categories (KSIC) Restrictions Competent authority
Satellite and other broadcasting
(60229)
Cable communications
(61210)
Mobile communications
(61220)
Satellite communications
(61230)
Domestic commercial bank
(64121)
Permitted when foreign investment ratio is
below 49% (below 20% for Internet multimedia
broadcasting contents operation in general
programming)
Permitted when the sum of shares held by foreign
governments of foreigners is less than 49% of the
total issued shares
Permitted when foreign investment ratio is
below 49% (below 20% for Internet multimedia
broadcasting contents operation in general
programming)
Permitted when the sum of shares held by foreign
governments of foreigners is less than 49% of
the total issued shares. However, there are no
restrictions on value added communications
businesses.
Permitted when foreign investment ration is
below 25%. Permitted only for commercial banks
and regional banks
Ministry of Culture, Sports
and Tourism
Ministry of Culture, Sports
and Tourism
Ministry of Culture, Sports
and Tourism
Ministry of Culture, Sports
and Tourism
Financial Services Commission
Government policies for investment promotion:
With an eye towards global market trends, the Korean
Government has selected 17 industries across three
sectors that are expected to serve as future drivers of
economic growth – and in which foreign investment
is being promoted. The designated “growth-engine”
industries include: renewable energy, low-carbon
energy technologies, green transportation systems, IT
convergence citywide, LEDs in the green technology
sector, broadcasting and communications media,
intelligent robots, bio-pharmaceutical and medical
devices, information technology, food industry and
nano-convergence in the high-tech convergence
sector, healthcare, green financing, cultural content and
software, education, MICE (conventions and exhibitions),
and tourism-related industries in the value added service
sector.
Value added strategy in core industries: Korea’s high
competency in core industries such as ship building,
automobiles, and steel making has been obtained
through high technological development supported by
the Government. Although these industries have shown
significant growth, competition in the global market has
intensified. In response, Korean companies are focusing
on the development of high value-added products and
services, such as hybrid and fuel cell-powered vehicles,
and specialised ships that require core advanced
technology and advanced materials. Opportunities exist
for foreign companies to add knowledge and technology
to these areas of industry.