What is foreign investment?
Concept of foreign investment- Foreign investment means that ① a foreigner possesses a stock or stake of Korean corporation or a company, ② its overseas parent company lends a long-term loan to a foreign-invested company for more than five years, or ③ a foreigner contributes to a nonprofit corporation (Subparagraph 4 of Article 2 (1) of the Foreign Investment Promotion Act).
Definition of terms- The term “foreigner” means ① individuals with foreign nationality, ② corporations established under foreign laws, ③ institutions acting on behalf of foreign economic cooperation affairs of foreign governments, ④ international organizations handling affairs related to development finance such as the International Bank for Reconstruction and Development, the Korea International Finance Corporation, and the Asian Development Bank, and ⑤ international organizations handling or acting on behalf of foreign investment affairs (Subparagraph 1 of Article 2 (1) of the Foreign Investment Promotion Act and Article 2 (1) of the Enforcement Decree of the Foreign Investment Promotion Act).
- The term “foreign investor” is a foreigner who possesses or contributes to stocks (Subparagraph 5 of Article 2 (1) of the Foreign Investment Promotion Act).
- The term “investment object” means investments made by a foreign investor to possess stocks or stakes and refers to any of the following (Subparagraph 8 of Article 2 (1) of the Foreign Investment Promotion Act and Article (10), (11), and (12) of the Enforcement Decree of the Foreign Investment Promotion Act).
① Means of foreign payment under the Foreign Exchange Transactions Act or means of domestic payment by the exchange thereof
② Capital goods
③ Proceeds from the stocks or stakes acquired under the conditions as prescribed by the Foreign Investment Promotion Act
④ Industrial property rights, the right to be utilized in the industrial activities from among the copyrights under the Copyright Act, and the layout-design right under the Act on the Layout-Designs of Semiconductor Integrated Circuits, other equivalent technologies thereto, and rights pertaining to the use of such rights or technologies
⑤ Where a foreigner closes a branch or office in Korea and converts it into another domestic corporation or a domestic corporation with a stock, etc. owned by a foreigner is dissolved, the remaining property distributed to the relevant foreigner according to the liquidation of the relevant branch, office, or corporation
⑥ Loans under Item B of Subparagraph 4 of Article 2 of the Foreign Investment Promotion Act or other amounts of repayment of loans from abroad
⑦ Stocks of foreign corporations listed on foreign securities markets and stocks owned by foreigners under the Foreign Investment Promotion Act or the Foreign Exchange Transactions Act
⑧ Real estate in Korea
⑨ Money coming from the sale of stocks or stakes and real estate of a Korean corporation or a company run by a Korean citizen, held by a foreigner in accordance with the Foreign Investment Promotion Act and the Foreign Exchange Transactions Act