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Types of Factory Location

The factory location is largely divided into the factory location in the industrial complex (planned location) and the factory location outside of the industrial complex (footloose location).

The factory location outside of the industrial complex (footloose location) is divided largely into the metropolitan area and outside of the metropolitan area which makes the difference in the contents of limitations regarding the factory location. Because in case of factory establishment outside of the industrial complex the permits and licenses must be attained individually according to the factory establishment approval process, the factory establishment process is more complicated and time consuming compared to factory establishment in the industrial complex. However, the merit of it is that factories can be newly constructed or enlarged at the right time and right place (Article 13.(1) of the 「Industrial Cluster Development and Factory Establishment Act」).

The term "factory location in industrial complex (planned location)" stands for the establishment by State, public organization and civil enterprise of factories in an industrial complex, which is developed according to the comprehensive plan by selecting a specific region, in order to collectively establish and raise factories. There are national industrial complexes, general industrial complexes, high-tech city industrial complexes and agricultural industrial complexes. The State or local governments notify business types, residential requirements and procedures and others that are adequate for each industrial land and then sell them to qualifying enterprises. Anyone who tries to operate a manufacturing business in the industrial complex can establish a factory by concluding a contract of occupancy with the management agencies. Like this, in case of factory location in the industrial complex (planned location), the administrative procedures regarding factory establishment is brief.

Matters to Examin regarding Factory Establishment in Areas Outside of the Industrial Complex

It shall be examined whether it is possible to establish factories pursuant to the act regarding location in the area outside of the industrial complex.

For it is difficult to determine whether the factory establishment in the area outside of the industrial complex is feasible, the head of Si/Gun/Gu, shall, within 10 days from the application by the landowner or any other interested person, ascertain and notify whether it is possible to establish a factory by lot number with regard to the land within their territorial jurisdiction (Article 9.(1) of the 「Industrial Cluster Development and Factory Establishment Act」).

In other cases of factory establishment in the area outside of the metropolitan area, the 「National Land Planning and Utilization Act」shall be examined focusing on the regulation of use district. However, the cases of factory establishment in the metropolitan area, regulations according to the land classifications such as overpopulation control, growth management, nature reserve and others.

Matters to Examine Regarding Factory Establishment in the Industrial Complex Area

Because when establishing a factory in an area within the industrial complex, there is no need for a separate approval of factory establishment when the contract for occupancy is concluded with management agencies, so only the type of occupancy needs to be determined according to the type of industrial complex. The industrial complex is refers only to the industrial complex pursuant to the 「Industrial Cluster Development and Factory Establishment Act」. Among the kinds of industrial complexes are national industrial complexes, general industrial complexes, high-tech city industrial complexes, and agricultural and industrial complexes (Article 2.-14 of the 「Industrial Cluster Development and Factory Establishment Act」).