The KRW 100 Million Minimum Investment Requirement: Where Foreign Investors Most Often Get Stuck in Practice
Under the Foreign Investment Promotion Act, a foreign investor must acquire shares valued at KRW 100 million or more to be recognized as a qualified foreign investor.
This requirement applies when a foreign national or foreign corporation acquires shares or equity in a domestic company, or provides a long-term loan.
This post covers the legal basis for the KRW 100 million threshold, how the amount is calculated, the foreign currency remittance process, and the specific points where things most commonly go wrong in practice.
Legal Basis for the KRW 100 Million Threshold
Article 2(1)(4) of the Foreign Investment Promotion Act
Article 2(1)(4)(a) of the Foreign Investment Promotion Act stipulates that when a foreign national acquires shares for the purpose of participating in the management of a domestic company or establishing a continuing economic relationship, the acquisition is recognized as "foreign investment" only if the acquisition value is KRW 100 million or more.
Simply purchasing shares does not automatically constitute foreign investment.
The KRW 100 million threshold is the legal gateway to the protections and benefits available under the Foreign Investment Promotion Act.
What Changes If the Amount Falls Below KRW 100 Million
If the investment is below KRW 100 million, filing a foreign investment notification is not possible.
Without a foreign investment notification, the company cannot be registered as a foreign-invested company.
This also means that applying for a D-8 (Corporate Investment) visa becomes impossible, and the investor will be ineligible for tax incentives or location support.
Types of Investment That Satisfy the KRW 100 Million Requirement
Direct Acquisition of Shares or Equity
The most common approach is to directly acquire shares or equity in a domestic corporation.
For a newly incorporated company, the paid-in capital at the time of incorporation must be KRW 100 million or more.
For investment in an existing company, the total value of the shares being acquired must be KRW 100 million or more.
| Investment Type | Minimum Requirement | Notes |
|---|---|---|
| Incorporating a new company | Paid-in capital of KRW 100 million or more | Payment must be completed before registration |
| Acquiring shares in an existing company | Acquired share value of KRW 100 million or more | At least 10% equity stake required in principle |
| Providing a long-term loan | 5+ year term + KRW 100 million or more | Separate regulations apply for financial institutions |
Long-Term Loan Method
A foreign national who provides a long-term loan of five years or more to a domestic company may also qualify as a foreign investment.
The loan amount must be KRW 100 million or more, and the relevant documentation — including a loan agreement — must be in place.
In practice, share acquisition is far more common; the long-term loan approach is rarely seen.
Calculating the Investment Amount — What Practitioners Often Miss
When Paying in Installments
When paying KRW 100 million across multiple installments, a foreign investment notification cannot be filed at any point before the cumulative total reaches KRW 100 million.
This is where things go wrong most often in practice.
If you plan to pay in installments, map out your timeline and identify exactly when the KRW 100 million threshold will be reached before proceeding.
Reaching KRW 100 Million Through Additional Investment
If a prior investment was below KRW 100 million and a subsequent investment pushes the total above KRW 100 million, a new notification must be filed at the time of the additional investment.
One of the most commonly overlooked points is increasing one's equity stake through additional investment without filing an amended notification.
Acquiring shares without filing a foreign investment notification can result in a violation of the Foreign Exchange Transactions Act.
Important: Using borrowed funds or fictitious capital to meet the KRW 100 million threshold can render the entire incorporation void as a violation of paid-in capital requirements. The source of funds must be money held in the investor's own name at an overseas account.
Foreign Currency Remittance and Exchange Rate Standards
Remitting in USD, JPY, or CNY
When a foreign investor remits in foreign currency, whether the KRW 100 million threshold is met is determined using the standard exchange rate on the date of payment.
You must verify that the KRW equivalent on the payment date is KRW 100 million or more.
During periods of significant exchange rate fluctuation, the same dollar amount can result in different KRW equivalents — making the timing of remittance a deciding factor.
| Payment Currency | Conversion Basis | How to Check |
|---|---|---|
| US Dollar (USD) | Standard exchange rate on payment date | Bank of Korea ECOS |
| Japanese Yen (JPY) | Standard exchange rate on payment date | Bank of Korea published rate |
| Chinese Yuan (CNY) | Standard exchange rate on payment date | Bank of Korea published rate |
| Other foreign currencies | Standard exchange rate on payment date | Bank of Korea published rate |
Getting the Order Wrong Means an Immediate Violation
Foreign exchange notification or notification acceptance must be completed before remitting funds to Korea.
Remitting first and notifying later is a violation of the Foreign Exchange Transactions Act.
This is typically where investors get caught — banks often receive the deposit first and then ask about the notification process afterward.
Practical tip: Exchange rates by date can be looked up in the Bank of Korea Economic Statistics System (ECOS). Use the rate for the actual payment date, not the day before.
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The appropriate remittance method, foreign currency conversion standard, and investment notification timing all depend on individual circumstances.
Confirm the exact payment procedure and applicable standards through a consultation.
The Investment Notification Process — When Is the KRW 100 Million Verified?
The Pre-Investment Notification Stage
Before investing in a domestic corporation, a foreign investor must file a foreign investment notification through KOTRA or a designated foreign exchange bank.
The notification requires details such as the planned investment amount, payment method, and equity structure, and this is where the KRW 100 million threshold is reviewed.
After the notification is accepted, the foreign currency is remitted and the company incorporation or share acquisition process proceeds.
Notification Bodies and Documentation Requirements
Foreign investment notifications are processed at designated foreign exchange banks or at KOTRA's Investment Attraction Division.
Investments below KRW 100 million are not accepted at these counters.
Documentation requirements have become more stringent in recent years, so confirm what documents are needed before filing — required materials vary by case, and this stage is where requirements tend to diverge most.
Real-World Problems When the KRW 100 Million Threshold Is Not Met
The D-8 Visa Application Is Blocked
Without a foreign investment notification, applying for a D-8 Corporate Investment visa is not possible.
The D-8 visa is issued to foreign nationals who participate in managing a foreign-invested company, and a foreign investment notification is a prerequisite for obtaining the foreign-invested company certificate.
Ultimately, failure to meet the KRW 100 million requirement causes the visa process to unravel from the very start.
Complete Exclusion from Tax Benefits and Government Support
Tax reductions, rental subsidies, cash grants, and other incentives under the Foreign Investment Promotion Act are available only to companies registered as foreign-invested companies.
Failing to file a foreign investment notification due to falling short of the KRW 100 million threshold means full exclusion from all of these benefits.
A common mistake in practice is attempting to retroactively qualify by increasing paid-in capital at a later date — this is not permitted in principle.
Important: The KRW 100 million standard is subject to change through revisions to enforcement decrees and ministerial notices issued by the Ministry of Trade, Industry and Energy. Confirm how the current standard applies to your specific case with the relevant authority at the time of notification.
Frequently Asked Questions
Q. If two foreign nationals invest jointly, does each person need to contribute KRW 100 million?
The threshold is evaluated based on each individual's share acquisition value, not the combined total.
If one person invests KRW 50 million and the other invests KRW 50 million, neither satisfies the requirement individually.
When using a joint investment structure, the structure must be reviewed and confirmed before filing.
Q. Can I pay KRW 50 million upfront and add another KRW 50 million later?
It is possible, but timing management is critical.
If the initial payment is below KRW 100 million, a foreign investment notification cannot be filed at that point.
The notification must be filed after the additional payment brings the total to KRW 100 million or more. If the company is incorporated before that threshold is reached, it may be registered as an ordinary domestic company rather than a foreign-invested company.
Q. Does the KRW 100 million capital need to be paid in Korean won, or can foreign currency be used?
Foreign currency payment is also permitted.
However, the KRW equivalent calculated at the standard exchange rate on the payment date must be KRW 100 million or more.
Foreign exchange notification acceptance must be completed before the funds are remitted — reversing this order constitutes an immediate violation.
Q. Can funds already held in Korea be used to make the KRW 100 million investment?
In principle, the funds must be remitted from overseas.
Whether funds already held in a domestic account can be recognized as a qualifying investment depends on the nature and source of those funds.
This is an area where you must confirm with a bank or specialist in advance to avoid complications.
Q. Could the KRW 100 million threshold change in the future?
The threshold can be changed through revisions to the enforcement decree of the Foreign Investment Promotion Act.
Confirm how the current standard applies to your case through official channels at the Ministry of Trade, Industry and Energy or the KOTRA Foreign Investment Ombudsman.
Q. Can a company be incorporated with 100% foreign ownership?
Yes, this is permitted.
A company with 100% foreign equity ownership is allowed.
In this case, the foreign investment notification and company incorporation process are carried out together, with paid-in capital of KRW 100 million or more as a prerequisite.
Need Expert Assistance?
Vision Administrative Office handles the entire process — from foreign investment notification and company incorporation to D-8 visa applications.
Determining whether the KRW 100 million requirement is met, timing foreign currency remittance correctly, and structuring equity ownership — these are the three issues practitioners run into most often, and they are the first things we address.
Fees vary by case and will be explained clearly during your free consultation.
Vision Administrative Office
- Phone: 02-363-2251
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- Address: 3F, Sungwoo Building, 324 Toegye-ro, Jung-gu, Seoul 04614
Ministry of Trade, Industry and Energy | KOTRA Foreign Investment | Foreign Investment Promotion Act (Full Text)
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