Cancellation of Corporate R&D Center Recognition in Korea — Mandatory Grounds and Consequences of a Missed Change Report

The Act on Support for Research and Development of Corporate Research Institutes lists 10 grounds for cancelling the recognition of a corporate R&D center (기업부설연구소) or dedicated R&D department. Recognition or a change report obtained by false or fraudulent means, a request by the company and closure of the company lead to mandatory cancellation; the other 7, such as not filing a change report within 1 year, are discretionary. This is a recognition by the Minister of Science and ICT, not a permit or registration, and the Korea Industrial Technology Association (KOITA) handles filings and cancellations on the Minister's behalf. Centers recognised before the Act took effect on 1 February 2026 are treated as recognised under it, so the same rules apply.

Recognition requirements are covered in our corporate R&D center requirements guide. This page focuses on cancellation and its consequences.

Mandatory and discretionary grounds

Ground	Type
Recognition or a change report obtained by false or fraudulent means	Mandatory
The company requests cancellation (unless another ground exists)	Mandatory
The company closes its business	Mandatory
Closure of the center is confirmed	Discretionary
No change report within 1 year of the change	Discretionary
A correction order is not carried out in time	Discretionary
Breach of the compliance duties	Discretionary
Research becomes impossible due to restrictions under other laws	Discretionary
Refusing, obstructing or evading an on-site inspection without good reason	Discretionary
Substantial reason to believe the center is inactive	Discretionary

The compliance duties are broad. Dedicated researchers must not also handle production, sales or other business work; the center cannot be in a detached house, multi-unit housing, an unpermitted building or a temporary structure; and the company must submit R&D results every year and any data requested. The Decree adds that non-research staff must be employed, the center must be at one address and researchers must work in the research facility. A small company's representative within 3 years of founding may double as a dedicated researcher.

How missed change reports and correction orders lead to cancellation

A change report is required when the company's name, address, representative, company type or industry changes, or when the center's name, address, research field, head, research staff or research space changes. File it with KOITA, with supporting documents, within 30 days of the change. The 30 days are the filing deadline; failing to report for 1 year makes it a ground for cancellation. A false change report leads to mandatory cancellation regardless of timing.

If the center no longer meets the recognition standards, for example because a researcher left, a correction order with a period of at least 1 month comes first. The period is 1 month in principle and can be extended by up to 2 months at the company's request. When something changes:

1. Fix the date of the change, such as a resignation, move or new representative.
2. Count 30 days from that date as your filing deadline.
3. Check whether staff or space now falls short of the standards.
4. If so, plan hiring or space fixes, and meet any correction order in time or request an extension.
5. File an accurate change report with supporting documents.

Procedure and what follows cancellation

Cancellation requires a hearing. At least 15 days before it, the company is notified of the center's name and address, the facts behind the cancellation, how and by when to submit opinions, and the hearing and planned cancellation dates. The hearing may be skipped for cancellations on request or after closure, or where the company clearly waives its right to state an opinion. On-site inspections are in principle notified in writing at least 7 days in advance, and refusing one without good reason is both a ground for cancellation and subject to an administrative fine.

A company whose recognition was cancelled for false or fraudulent recognition or change reporting cannot reapply until 1 year after cancellation. If the center was designated an excellent corporate R&D center, that designation must also be cancelled and the certificate returned. Continuing to present the center as recognised after cancellation is false representation subject to an administrative fine. For tax effects, see our R&D center tax credit guide.

YouSun Administrative Agency (Chief Administrative Agent Jung Yu-sun)