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  • Writer's pictureJ&J Korea

Company Formation In South Korea: Common Obstacles & Solutions

The Dynamic and economically robust business environment of South Korea has lured many foreign investors. Foreigners come to establish their company in the country in the hope and search for rapid growth and elite business resources.

However, many investors don’t think much about common obstacles that might hinder company formation in South Korea. These obstacles include language barriers, legal processes and more. Indeed, all of these obstacles can shatter foreign investors' dreams of establishing a business in the country.

Let's explore some common obstacles that foreign investors might face when establishing a company in South Korea. And understand how business service providers work as effective solutions to navigate through them.

Common Obstacles In South Korean Company Formation

Language Barrier

Often the language barrier is the primary obstacle that foreign investors face in company formation. This happens because Korean is the official language of the country. And most of the legal documents and other government processes are conducted in the official language. However, English is widely spoken in South Korea's business settings.

That’s why foreign investors must seek the help of business service providers. They can choose service providers that have knowledge of multiple languages and are capable of breaking the language barrier.

Complex Legal Procedures

South Korea has a well-established legal framework for foreign business formation. But investors have to follow this framework appropriately as there are no exemptions. That's why it can be complex and daunting for foreign investors.

Before beginning the legal or registration process, they must understand the legal requirements. They have to keep the documentation ready and file them in a compliant manner.

A business service provider can help investors clear out this obstacle. They have elite knowledge of the legal framework of the country. They can ensure a successful registration process and keep up with the country's compliance.

Capital Requirements

Foreign investors can establish limited liability companies, branch companies, liaison offices and more in the country. These company formations require different amounts of capital investment. If the investors don't have sufficient funds, then they can not establish a company in South Korea.

Also, they might need more than the minimum amount of capital to sustain or grow a company. Business service providers are aware of this thing. They know the minimum capital requirements and can provide appropriate guidance about it. Also, business service providers can give better insights about the capital required to establish a robust company.

The Taxation Process

The taxation process is a huge part of South Korea company formation. That's why foreigners have to get a special identification number from the tax offices in the country. Business services providers know this and register investors' companies in the country rightfully. They register the business in the registry court with appropriate documentation.

Later they can register the company in the tax office and obtain the tax identification number. This number is crucial to open a commercial bank account in the country. Investors can use this account to move capital in the country.

After the company is established, the investors have to pay the payroll and other taxes. They also pay income taxes on behalf of their workforce. Authentic business service providers can take care of this and maintain a long-term relationship with foreign investors.


Company establishment in South Korea brings forth its fair share of obstacles. Indeed, investors have to sweep out these obstacles from their path. They can make this possible with the assistance of authentic business service providers.

Do you want to tackle these common obstacles that you might face during company formation in South Korea? Then J&J Korea, the elite business services providers, are here to help. You can consult and seek expert help by visiting our official business website. Let our experts work for you and ease up your company establishment voyage in South Korea.



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