In Korea, the domestic registration is for the branch or liaison office of the foreign head office; the head office itself is not a Korean corporate form. This article explains what each local presence can do, how to contract with them, and what to check for compliance.
Corporate status & registration
Corporate forms do not apply to foreign registrations. A foreign corporation’s Korean presence is not incorporated as a Korean 주식회사, 유한회사, 유한책임회사, 합명회사, or 합자회사. Instead:
- Branch (지점/영업소) — Registered at the Korean court under Foreign Company Registration (외국회사 등기). You can obtain a foreign company registry certificate (e.g., 외국회사(지점) 등기사항증명서). A branch does not receive a domestic Corporate Registration Number (법인등록번호) like a Korean-incorporated company.
- Liaison office (연락사무소) — Not registered at court. It is a non–income-generating office for research, coordination, or communications. For limited administrative/tax purposes it typically holds a Unique Identification Number (고유번호) issued via the National Tax Service processes; it has no court registry file.
What this entity type can do
Branch: Conducts income-generating business in Korea as a domestic place of business (e.g., sales, service delivery), enters into contracts, and issues tax invoices where registered to do so.
Liaison office: Performs non-income-generating activities only (market research, liaison, QA/coordination). It must not engage in sales or revenue activities and therefore does not issue tax invoices for sales.
What to be aware of when contracting
- Confirm whether the counterparty is a branch or a liaison office; only branches (or Korean subsidiaries) can invoice for sales.
- For a branch, check the Foreign Company Registration (외국회사 등기) certificate to verify the branch address, registered matters, and the signatory’s authority.
- For a liaison office, request its Unique Identification Number (고유번호) confirmation and ensure your agreement covers only non-revenue activities.
Licenses and permits
Licensing depends on the actual activity, not the foreign status. A branch must obtain the same sectoral approvals as a domestic entity for regulated lines (finance, healthcare, food & beverage, energy, etc.). A liaison office, by design, avoids activities that would require commercial licensing.
Accounting and tax considerations
Branch: Subject to Korean corporate income tax on Korean-source income and to VAT on taxable supplies. It files taxes via its Korean place of business and follows the usual invoicing/withholding rules.
Liaison office: Generally not subject to corporate income tax on business income because it must not conduct sales; however, withholding may apply to certain payments. Keep internal controls to ensure activities remain non-revenue in nature.