Special Support for Free Economic Zones (Foreign-invested Companies)

1.Cash Reward

Support through negotiations for foreign-invested companies with a foreign investment ratio of 30% or more

• Support for factory facility purchase cost, factory facility/research equipment installation cost, employment subsidy, education and training subsidy, etc.
• Businesses in the field of new growth engines and original technologies
• Introduction or expansion of high value-added high-tech parts, materials and factory facilities
• Introduction or expansion of factory facilities and large-scale recruiting
• Introduction or expansion of training facilities for industrial support service business and high technology-related business
• Regional headquarters established in Korea, etc.

2.Tax Cuts and Support for Administrative Decisions

Tax Cuts and Support for Administrative Decisions

National tax (Customs)	100% exemption of customs duties for imported capital goods for 5 years	Over $10 million in manufacturing Over $10 million in tourism Over $5 million in logistics Over $5 million for medical institutions R&D over 1 million dollars
Local tax	Acquisition tax and property tax reduction for 15 years (Exemption amount: calculated tax amount × foreign investment ratio)
Infrastructure support	Support for infrastructure such as roads, railroads, airports, port facilities, water and sewage facilities, and waste treatment facilities	50% from government funds
		Full support when the Free Economic Zone Committee agrees
Foreign educational institutions	Support for foreign education and research institute establishment preparation expenses, initial operating expenses, construction expenses, etc.	Satisfy evaluation factors such as level of contribution to national development and the reputation of the institution
Rental Benefits	Rentals on state and public property available up to 50 years. Rent is roughly 1% of the property value. 50% to 100% reduction in rent (by ordinance)	Foreign investment companies. Companies returning to Korea. High-tech products and key strategic projects.
Locational Benefits	Permission granted to move in to the dedicated location. Can be sold below the development cost.

3.Other Deregulation

Other Deregulation

Deregulation in the labor management	Exclusion of the mandatory provisions for preferential hiring of persons of national merit, the disabled, the elderly, etc. Allow unpaid holidays for workers Expansion of work subject to dispatch of workers and extension of period of dispatch of workers
Exception from the Metropolitan Area Reorganization Planning Act	Resident foreign-invested companies can be excluded from application of Article 7 (Restrictions on Activities in Overcrowding Control Zones), Article 8 (Restrictions on Activities in Growth Management Zones), Article 12 (Imposition and Collection of Overcrowding Charges), Article 18 (Restriction on Total Amount of Population Inducing Facilities) and Article 19 (Regulations on large-scale development projects) of 『Seoul Metropolitan Area Reorganization Planning Act』.
Forex trading	Direct external payment is available for current transactions within the range of $20,000 or less

※ The target of support is expected to expand by the amendment of the law (for domestic high-technology and high-tech products, investment companies in core strategic industries)

Subsidy for promoting local investment

Basis for support

• Articles 11 and 19 of the Special Act on Balanced National Development, the standards for financial support of the state for attracting investment companies by local governments, etc.

Subject to support

• companies relocating from the metropolitan area, new/extended domestic companies, companies participating in win-win local job campaign, etc.

Type of support

• Type of support : Real estate subsidy, facility subsidy (+ 2% additional support for resident companies of Economic Free Zone )

A guideline according to company type

A guideline according to company type

Types	Application conditions	Support	Criteria
Companies relocating from the metropolitan area	Business operation experience in the metropolitan area for more than 1 consecutive years Over 30 full-time employees Relocation of independent business sites such as headquarters, factories, and research institutes with an investment amount of more than 1 billion won (more than 30 billion won for large companies) Maintain 30 or more full-time employees after relocation	Real estate subsidy	For SMEs, less than 30% of the land purchase price For medium-sized enterprises, less than 15% of the land purchase price
		Facility subsidy	For SMEs, less than 10% of facility investment For medium-sized enterprises, less than 8% of the amount of facility investment For large companies, within 6% of facility investment
Newly established or extended corporations	Business operation in Korea for more than 1 years 10 or more full-time employees Investment amount of 1 billion won or more (30 billion won or more for large companies) Creation of new jobs after investment is at least 10% (at least 10 people) of the existing full-time employees	Real estate subsidy	N/A
		Facility subsidy	For SMEs, less than 10% of facility investment For medium-sized enterprises, less than 8% of the amount of facility investment For large companies, within 6% of facility investment
Companies participating in win-win local job campaig	Over 10 new full-time employees Investment amount of 1 billion won or more (30 billion won for large corporations) Existing business sites should be maintained Provided that existing workplaces in overcrowding control areas in the metropolitan area and newly established corporations recognized by the win-win regional job review committee are excluded.	Real estate subsidy	For SMEs, less than 30% of the land purchase price For medium-sized enterprises, less than 15% of the land purchase price None for large companies
		Facility subsidy	For SMEs, less than 10% of facility investment For medium-sized enterprises, less than 8% of the amount of facility investment For large companies, within 6% of facility investment Adding 3~10% of facility subsidy support rate is available
Companies Returning to Korea	Government Support for Companies Returning to Korea that had Moved Overseas.] KOTRA will review the qualifications of the companies returning to Korea that apply for government support in accordance to Article 7, and the final decision will be made by the MInistry of Trade, Industry, and Energy. ※ Payment within KRW 60 billion per company (within KRW 30 billion per business site)	Real estate subsidy	SMEs, medium, and large businesses : 24~48% (based on general region / varies depending on industry)
		Facility subsidy	SMEs, medium, and large businesses : 24~48% (based on general region / varies depending on industry) The subsidy used for the location cannot exceed 50% of the subsidy used for the facility ※ Relocation subsidy: up to 400 million won

Subsidies for Investment Attraction

Basis for support

• Jeonnam-Gwangju Special Metropolitan City Investment Promotion Ordinance and Enforcement Rules

Support Target

• Domestic Companies
  • 1) Relocation or establishment of corporations which maintained business within the jurisdiction for more than three consecutive years
  • 2) Relocation or establishment of corporations from outside of the jurisdiction
  • 3) Relocation or establishment in the industrial complex after completing the incubation program conducted by an external company
  • 4) Establishment or expansion of core projects recognized necessary by the Mayor
• International Companies
  • International Companies of which foreign investment ratio of a foreign company is 30% or more, or if a foreigner is the largest shareholder

Application requirements

• 1) Investment amount of 2 billion KRW or more, 20 or more full-time employment
• 2) More than 50 full-time employees
• 3) Investment amount of 1.5 billion KRW or more, ventures Innobiz certified companies, etc. with 15 or more full-time employees
• 4) Investment amount of 1 billion KRW or more, head office, research institutes, cultural industries, information and communication industries with 10 or more full-time employees

※ Number of new full-time employees of local companies: 10% of the number of full-time employees of existing workplaces (at least 10 people)

※ Companies returning to Korea shall meet one of two requirements.

Subsidy Details

• Subsidy for real estate cost, subsidy for facility investment, subsidy for employment, education and training, and subsidy for migrant employees

Subsidy Details

Types	General	Venture, Innobiz, Mining Industry, Parts & Materials, Nanotechnology, Industrial Design, Energy Sector	Head office, research institute, cultural industry, information and communication industry
Real estate grant	Within 30% of the investment amount ※Domestic companies are not eligible for support
Equipment investment Subsidy	Within 14% of the investment in excess of 1 billion KRW * Additional 2% can be applied to Automotive, AI, energy, semiconductor companies	Within 14% (venture, Innobiz, energy-related companies) of the investment in excess of 750 KRW	Within 14% (head office, research institute, cultural industry, information and communication company) of the investment amount in excess of 500 million KRW
Employment subsidy	(Foreign-invested companies, call center and telemarketing service businesses) When the number of regular employees exceeds 20, 600,000 won per exceeding number of person per month (within 12 months) (Culture industry, information and communication industry) When the number of full-time employees exceeds 10, 600,000 won per month for each excess employee (within 12 months) (Logistics company) In case of more than 150 full-time employees, 500,000 won per person per month (within 4 months) when there are more than 20 new hires Overlapping support with other subsidies is not allowed.
Education training subsidy	When there are more than 20 full-time employees, 600,000 won per month for each excess employee (within 6 months)	When there are more than 15 full-time employees, 600,000 won per month for each excess employee (within 6 months)	When there are more than 10 full-time employees, 600,000 won per month for each excess employee (within 6 months)
Relocating employee subsidy	If more than 50 employees of an external company move to the city, 600,000 won per employee who has lived in the city for more than one year (2 million won when accompanied by family)

• Applying limit : according to employment* within KRW 5 billion per company
• The average monthly wage per person of the company × the number of full-time employees × six months

Special support for large-scale investment companies

Target for support

• Domestic If the investment amount is 50 billion KRW or more, or the number of full-time employees is 300 or more
• Foreigners If the investment amount is 50 million USD or more, or the number of regular employees is 300 or more
• Others
  • If the investment amount is KRW 40 billion or more, or if the number of full-time employees is 200 or more
  • Other venture companies, Innobiz certified companies, mining industry, parts and materials and their production facilities industry, energy industry, cultural industry, information and communication industry, etc.

Contents of support

• Contents of support : Within 10% of the total investment amount

Applying limit

• Applying limit : Average monthly wage per person × number of full-time employees × twelve months

One-Stop Service for Foreign-Invested Companies Entering Korea

Providing necessary financial services and various consulting services from the initial stage of entry into the domestic market to business expansion

Emerging stage support

• 1) Discovering and connecting investment targets : Introduction of domestic investment target companies and arranging cross-border M&A
• 2) Foreign direct investment business support : FDI report / capital exchange / share payment / FX consulting provided

Provision of financial solutions for foreign-invested companies

• 1) Provision of specialized products for foreign-invested companies : Dedicated working capital loan for foreign-invested companies / Provision of exclusive cards for foreign-invested corporations for newly-established foreign-invested companies
• 2) Provision of financial product services for foreign-invested companies : loans for employees of foreign-invested companies / retirement pensions for foreign-invested companies / foreign exchange consulting (export and import consulting linked to the Trade Insurance Corporation) / accounting and tax consulting for foreign-invested companies
• Contact : Investment Attraction Department (AI Convergence +82-62-613-6053, Automotive +82-62-613-6063, Energy +82-62-613-6072), Jeonnam-Gwangju Free Economic Zone Authority

Settlement Information for Foreign Investors