[Consulting] Foreign Investment Reporting Guide

Law firm Veat guided A Company, located in the U.S. Silicon Valley, on the necessary documents and procedures for foreign investment reporting during the process of transferring funds to its Korean subsidiary. When an overseas corporation invests in a domestic corporation, and that falls under the definition of ‘foreign investment’ as stipulated in the Foreign Investment Promotion Act, it may be eligible for benefits such as guaranteed outward remittances, exemption from the provision temporarily suspending foreign exchange transactions, national treatment, and exemption from discriminatory tax provisions.

A Company intended to lend funds to its subsidiary in the form of a subordinated loan. This falls under the definition of ‘providing long-term loans to a domestic corporation invested in by a foreigner’ as stipulated in Article 2 of the Foreign Investment Promotion Act and Article 2 of the Enforcement Decree of the same Act. Law firm Veat reviewed the laws and regulations related to the Foreign Investment Promotion Act and guided A Company on the reporting procedures and necessary information to ensure the fund transfer qualified as foreign investment.

Thank you.

Law firm Veat