1. Introduction

Hello,
This is Attorney Kyusung Lee from WeOn Law.

Korea is an ideal country for conducting various research and development (R&D) activities due to its systematic industrial infrastructure and abundant human resources. Notably, the Korean government fully supports R&D activities, which form the foundation of national competitiveness, with a focus on cutting-edge technology and sustainable development.

Through registration of in-house research institutes or R&D departments, companies engaged in R&D can access benefits such as personnel support, tax reductions, tariff exemptions, funding, and technical assistance.

In addition, businesses offering R&D support services can receive similar benefits by applying for designation as an R&D service business.

Foreign-invested companies, in particular, may qualify for additional investment incentives, such as cash grants, tax benefits, and site support, if they meet specific requirements for their R&D facilities.

Furthermore, regional headquarters or R&D facilities designated by the Ministry of Trade, Industry, and Energy are eligible for the issuance of a Corporate Investor (D-8) visa.

Today, let’s take a closer look at the special incentives available for R&D centers established by foreign-invested companies.

2. About Attorney Kyusung Lee

- Key Credentials

Contact Attorney Kyusung Lee for Consultation
Email: kslee@weonlaw.co.kr
Phone: +82-2-6264-7604

Consultations are available in fluent English.

3. Key Registration Requirements and Benefits for Research Institutes

♾ Companies meeting certain conditions can register their in-house research institutes or R&D departments with the Korea Industrial Technology Association (KOITA) to receive various R&D-related benefits.

01. Registration Process

To register, a company must first establish an in-house research institute or R&D department that meets specific requirements and prepare the necessary documents for submission to KOITA. Registration is only available through an online system.

< Registration Steps >

02. Qualification Requirements

Personnel Requirements

Facility Requirements

03. Benefits

Registered companies gain access to support in areas such as taxation, tariffs, personnel, funding, market expansion, and technology.

4. Q&A on Special Incentives for Foreign-Invested R&D Centers

Q. Can a company apply for an R&D department if it only conducts research and the CEO handles all other responsibilities?
A. No. In addition to research staff in the R&D department, the company must have at least one other full-time employee (excluding the CEO) in another department. Both the researchers and full-time staff must be registered for all four social insurance programs.

Q. Are activities like economic trend analysis recognized as R&D?
A. No. Activities such as market research or economic trend analysis, which fall outside the realm of science and technology, are not recognized. Only systematic solutions to scientific or technological uncertainties directly contributing to technological advancement qualify as R&D activities. Routine software operations or post-production activities are also excluded.

Q. Can researchers in an in-house research institute perform other tasks like sales support?
A. No. Researchers must exclusively engage in R&D-related work. However, within the first three years of establishment, researchers in small enterprises may concurrently serve as company representatives.

5. Conclusion

Today, we explored the special incentives available for foreign-invested companies establishing R&D centers in Korea.

With Korea's strong commitment to fostering R&D, foreign-invested companies setting up R&D centers can enjoy diverse benefits. However, as discussed, the process involves various steps and legal requirements, making it challenging to navigate independently.

If you need assistance, feel free to contact us at any time.

Thank you for your attention.

Contact:
Kyusung Lee
Attorney at Law, WeOn Law

Email: kslee@weonlaw.co.kr
Phone: +82-2-6264-7604