OCTIS vs subsidiary, branch or liaison office in South Korea
Three ways a foreign company can operate in Korea, and what each lets you do, owe and report.
Last checked · 2 sources
Otty's short answer
A foreign-invested company is a separate Korean corporation: your liability stops at the company, it can trade freely in its permitted scope, and it can borrow in Korea on its credit. A branch is part of the head office, which stays liable. A liaison office cannot earn profit and only does liaison work. Pick the subsidiary to sell in Korea, the liaison office only to research.
Side by side
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| What matters | OCTISHong Kong company + OCTIS global plan | Foreign-invested company | Domestic branch | Liaison office |
|---|---|---|---|---|
| Legal status | Hong Kong company, a separate legal entity | Korean corporation | Foreign corporation | Foreign corporation |
| Governing law | Hong Kong Companies Ordinance | Foreign Investment Promotion Act | Foreign Exchange Transaction Act | Foreign Exchange Transaction Act |
| Liability of head office | Limited to unpaid shares | Limited to the company | Extends to head office | Extends to head office |
| Minimum investment | No minimum capital | KRW 100 million for FDI | None | None |
| Can earn profit | Yes | Yes | Yes | No |
| Independent from head office | Yes, a separate legal entity | Yes | Subordinate | Subordinate |
| Borrow in Korea | Not an OCTIS product | Possible, by credit rating | Almost impossible | Impossible |
| Bookkeeping | Done by OCTIS accountants | Korean accounting standards | Korean standards | None required |
| External audit | Yes; independent HK CPA firm, coordinated by OCTIS | Above size tests | Not required | Not required |
| Tax benefits for foreign investors | Not needed for the Hong Kong company; local rules apply if you trade there | Available | None | None |
If you have staff, premises or local sales in this country, its own registration and tax rules still apply. OCTIS can help you arrange them.
Data sources & disclaimer: Comparison data was compiled from publicly available sources — including the competitors' own published pricing and feature pages — captured on 9 November 2026. Figures reflect the typical or advertised pricing at that time and may have changed since; plans, inclusions and prices vary by provider, region and promotion. OCTIS is independent and not affiliated with the named companies; all trademarks belong to their respective owners. This comparison is provided in good faith for general information only and is not professional, legal or financial advice — please verify current details with each provider before deciding.
Which one fits you
OCTIS · Hong Kong company + OCTIS global plan
Choose OCTIS if you want a Hong Kong company run from anywhere to serve Korean customers, with accounts and filings handled for you.
Foreign-invested company
Choose the foreign-invested company to sell in Korea, hire locally, borrow locally and keep head-office liability out of it.
Domestic branch
Choose a branch to run the same business as head office with no minimum investment, accepting that head office stays liable.
Liaison office
Choose a liaison office to research the market or support head office without earning revenue.
What the table does not show
The steps differ
A foreign-invested company follows five steps: foreign investment notification, remittance of funds, registration of incorporation, business registration, and registration as a foreign-invested company. A branch notifies the branch establishment, registers and then registers the business. A liaison office notifies its establishment and registers an identification number. KOTRA adds that you must open the corporate bank account at a foreign exchange bank straight away, and that opening an additional account at another bank is restricted for 20 business days.
Tax and accounting
A subsidiary pays corporate tax on its worldwide income. A branch pays tax on income from Korean sources, and some countries also charge branch tax. A liaison office has no tax obligation and no bookkeeping duty because it does not earn income. Both subsidiary and branch must keep books under Korean accounting principles. Only subsidiaries get the investment tax benefits under the Restriction of Special Taxation Act.
KRW 100 million is not a hard floor
KOTRA's table sets KRW 100 million as the minimum for a foreign-invested company to be counted as foreign direct investment. A foreigner may incorporate with less, but the company is not recognised as FDI and the share acquisition must be notified under the Foreign Exchange Transaction Act. Many tax and incentive routes only apply to recognised FDI.
Where OCTIS fits
OCTIS does not set up entities or keep books in Korea. If your Malaysian or Hong Kong company is entering Korea, we keep the home company's books and, for a Korean subsidiary or branch, can consolidate its statements into them. You can also compare running it from Malaysia or Hong Kong. Send us your current bill and we come in 10–30% off it.
Frequently asked questions
What is the difference between a branch and a subsidiary in Korea?
A subsidiary is a separate Korean corporation, so liability stops with it. A branch is a foreign corporation's own office and its liability extends to head office. A branch also has almost no ability to borrow in Korea.
Can a liaison office sell in Korea?
No. A liaison office may not generate profit and can only do liaison work such as research or contacts for head office. Anything that earns income needs a subsidiary or a branch instead.
How much capital does a foreign company need in Korea?
A branch or liaison office has no minimum investment. A foreign-invested company needs KRW 100 million to be recognised as FDI, though smaller incorporations are allowed without that status.
Which bank do I open the account with?
A foreign exchange bank. KOTRA warns that after opening one account, opening an additional one at another bank is restricted for 20 business days, so choose carefully. Agree the bank with your advisers before the first remittance.
How long do I have to register as a foreign-invested company?
Within 60 days after paying in the investment, at KOTRA or the foreign exchange bank where the first notification was made. Missing the window delays your foreign-invested status.
Sources
Checked on the date above. Links open the provider's or regulator's own page.