Korean Compliance Checklist for your Business in Korea

The following Korean Compliance Checklist is intended to provide, only, a basic overview of the necessaries for keeping the law and shareholders off your back.  We, highly, recommend having a compliance audit preformed – if you have not completed a compliance audit of your Korean business in the past or recently.
 
1.  Do you Have a Registered Company/Business?

Operating in Korea is not as simple as just leasing an office.  All businesses whether in the form of a corporation or sole proprietorship in Korea are required to register as business with the tax office and local government offices.  For some businesses the approval of a government agency shall be required.  Other articles on Korean corporate forms may be found at:

2.  Do you Have Employment Agreements, Employment Rules, License Agreements, Joint Venture Agreements, OEM Agreements, Shareholder Agreements, Lease Agreements Tailored for your Korean Business?

No your U.S. agreements are not good enough.  Other articles on the need for Korean-tailored agreements that may be of interest may be found at:

3.  Are you in Compliance with the Foreign Corrupt Practices Act and other Like Laws?

The U.S. Foreign Corrupt Practices Act (FCPA) and the British, Canadian, French, German equivalent allows the government to severely punish those for even actions of a Korean partner.  A compliance system must be put in place.  If you do not have a compliance system tailored to your Korean operation – you may be heading down a road that can lead you into the hands of not, only, the Korean prosecution, but the prosecution of your foreign government.  A few more posts that may be of interest:

4.  Have you Protected your Trademarks, Patents, Copyrights and other Intellectual Property Rights?  Registration of your Intellectual Property rights (IP) “internationally” is not good enough for Korea.  You must register your IP in Korea.  Please read the following posts:

5.  Due Diligence?
I wrote so many times about Korean Due Diligence it is painful to type those two Ds.

6.  Did you Conduct a Compliance Audit?
You may be in violation of employment, tax, environmental, antitrust/monopoly, currency control, transfer pricing, occupational health and other laws and regulations.

7.  Did you Conduct a Financial Audit by a True Independent Auditor?

Often these audits shall lead to a revelation of financial improprieties and sometimes “independent” auditors are controlled by key employees within your company.  Options exist.

Please – this is not to be taken as an exhaustive checklist.  Please scroll the blog for more issues that may arise in your operations in Korea.

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