The Ministry of Trade, Industry and Energy said on August 24 that it would revise the ordinance on foreign investment zone administration effective on the 25th.(image: IFFZ)
SEOUL, Aug. 26 (Korea Bizwire) – The government will relax regulations on foreign companies doing business in Korea as a way to encourage them to invest more in foreign investment zones.
The Ministry of Trade, Industry and Energy said on August 24 that it would revise the ordinance on foreign investment zone administration effective on the 25th. The gist of the revised provisions is that the government would reduce the minimum requirements for investment sum and plant size for foreign companies investing in the zones by half each.
In addition, the requirements that foreign companies that are unable to meet the threshold investment amount (twice that for the site’s land value) and the minimum building area ratio (twice that of the 3-20% applicable to domestic firms) must pay five times more for rent will be reduced to 100 percent. Previously, the foreign firms complying with the rules were required to pay only 1 percent of the site’s land value for rent.
The ministry expected the revision would substantially cut the rental payments of 40 foreign invested companies, with additional investment coming from new foreign firms. Separately, the government will encourage the foreign companies with manufacturing operations in Korea to install solar cells on their roofs so that they can save electricity cost while helping to lay the groundwork for renewable energy sources.
M.H. Lee (mhlee@koreabizwire.com)
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