Not Paying Korean Statutory Severance to an Employee in Korea is a Crime

Korean Labor & Employment Law has strict and specific rules imposed on employers, running afoul of these rules can place a representative director/sole director or the individual employee responsible for the violation of law to face criminal and civil sanctions. The criminal sanctions can include a sentence of time in prison or large fines. For an article on severance obligations after a merger please see: Korean Statutory Severance Obligations After a Merger in Korea. For example, the Employee Retirement Benefit

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Korean Tax Incentives for Start-up Businesses in Korea

Our friends at the Korean Tax Blog drafted a post on Korean Start-up Business Tax Incentives. We, at IPG Legal, have written other articles on other incentives, grants, and Korean free trade zones that can be found with a search of this blog, however, we have regrettably neglected many tax incentives. With the increasing cost of doing business in Korea, the Korean government is stepping up and offering incentives for some startup businesses., mature businesses and also businesses wishing to

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Why you Should Setup a Corporation in South Korea?

IPG Legal has assisted clients in the process of setting up a corporate entity in South Korea. Yes, it can be complex and time-consuming, but getting started on the right food is, often, the most important part to a successful business in Korea. For a list of corporate forms in Korea, please see: Korean Corporate Forms under the Korean Commercial Code. It is advisable to seek, in all but the most exceptional of cases, the assistance of a law firm

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Establishing Business with Korea via an Agent: Korean Agency Law Basics

For some companies wishing to establish business with Korea, the use of a commercial agency relationship may be an ideal way to establish your business presence in Korea. However, this type of agreement comes with risk. Please see: Termination of an Agency Agreement in Korea. https://www.thekoreanlawblog.com/2020/08/distribution-agreement-termination-korea-law.html An agent relationship is often ideal when a company seeks to sell its products in Korea, but wishes to first evaluate and familiarize itself with the Korean market prior to establishing a distributorship relationship

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Korean Independent Contractor Risks: Korean Labor Standards Act Basics

The Korean Court System has been less reluctant, in recent years, to deem a Korean independent contractor an “employee” under the Korean Labor Standards Act (LSA). This fact remains true even when an employer in Korea establishes that the independent contractor is aware that he/she was contracted as an independent contractor and, thus, not a regular employee of the Korean company. Upon the establishment of the status as “employee” in Korea, the individual is entitled to all of the benefits

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Top 100 Korean Lawyers & Legal Consultants in Korea

Sean Hayes, head of the Top Korean Dispute Resolution Law Firm of the Year was rated by LawAsia, one of the leading peer-reviewed publications in Asia, as a Top 100 Lawyer in Korea. Sean Hayes is one of the only non-Korean attorneys on this Korean Lawyer “A-list” and the only non-Korean that was on the list each year the list was published. Sean Hayes is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of

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Korean Exit Bans for Not Paying Taxes, Custom Duties and Violations of Korean Law

The Korean Immigration Control Act and related acts allow the potential to permanently impose an exit ban from Korea on foreigners for nearly all acts that are determined by the Korean Ministry of Justice as “harming the interest, public safety or order in the economy of the Republic of Korea” until the reason for the exit ban ceases to exist. (Immigration Control Act of Korea Article 4(1)5.) However, IPG Legal has successfully challenged these exit bans in Korea and is

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Exercising Korean Stock Options in Companies in Korea under the Korean Commercial Code

Stock options, in Korea, are often provided to senior foreign and domestic employees of companies in Korea. For stock options, in non-listed/non-public companies in Korea, to be exercisable by employees in Korea (thus a valid option) the option must be approved, in most cases, at a general shareholders meeting of the Korean company. Another article that may be of interest can be found at: Granting & Exercising Stock Options in Korea.   The articles of incorporation of the Korean stock granting

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Minimum Capital Requirements for Setting Up a Corporation in Korea

My friend at the Korean Tax Blog has an excellent post on the minimum capital requirement for setting up a company in Korea. The post notes that: Before 2009, Korean law required a minimum capital of 50 million KRW to estabish a corporation. However, since February 2009, there are no longer any restrictions related to mimimum capital in Korean Law. www.thekoreantaxblog.com This amendment to Korean Law has made it easier to open a company in Korea. However, to open a

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Liability of Persons who have Lent their Names for Korean Business Transactions

In Korea, the person who is actually the subject of rights and obligations, often differs from the nominee such as the holder of licenses or business registrations. Sometimes those with assets use these nominee/proxies to attempt to avoid liability. As such, under certain conditions, a counterparty to a transaction is protected, under the Korean Commercial Act, by acknowledging the liability of not only the party to the transaction, the name borrower, but also the nominee (name lender). See: Korea’s Real Name Transaction

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