In South Korea, a business with qualifying Foreign Direct Investment (FDI) can be formally registered as a foreign-invested company and issued a Certificate of Registration of a Foreign-Invested Company / Enterprise.
What is Foreign Direct Investment Certification?
Foreign Direct Investment Certification refers to the official registration of a qualifying foreign investment under Korea’s FDI framework. In practice, it means the investment has been properly notified, the investment funds or investment object have been completed, and the company has been registered as a foreign-invested company with KOTRA or the foreign exchange bank where the original notification was filed.
Who can receive this certification?
To qualify, a business typically falls under one of the following tracks:
- Equity Investment: A foreign investor contributes at least KRW 100 million and acquires at least 10% of the voting shares or total investment amount of the Korean company.
- Executive Appointment Exception: Even if the shareholding is below 10%, the investment may still qualify where the foreign investor invests at least KRW 100 million and appoints or dispatches an executive who participates in major decision-making and management.
- Long-Term Loan: A loan with an average maturity of at least five years from an overseas parent company or related foreign investor to an already foreign-invested company may also be recognized under the FDI framework.
What does the certification indicate about the business?
Foreign Direct Investment Certification indicates that the company’s foreign investment has completed Korea’s formal registration process and is officially recognized as a foreign-invested company. It is primarily a regulatory and administrative status marker, rather than a direct endorsement of the company’s technology, profitability, or current financial stability.
At the same time, the certification can still signal something meaningful about the company’s establishment stage. Since qualifying FDI generally requires a foreign investment of at least KRW 100 million, and those funds are injected into the company and may be used for business operations, the status can suggest that the business started with a relatively meaningful level of committed capital. Also, because a foreign investor may choose to establish a Korean company outside the FDI framework with less than KRW 100 million, opting for FDI registration often signals a more structured and committed market-entry approach.
Coverage in KOBDi: The KOBDi database includes companies registered as foreign-invested companies (외국인투자기업). This information appears on each Business Profile page, and these companies can be found via the KOBDi Korea Industry Search.
Related reading: For more on the certificate itself, see Certificate of Registration for Foreign-Invested Enterprises in Korea.