Incorporated Foundation Establishment Permit in Korea

Does a foundation need a permit?

Yes. Under the Civil Act, an association or foundation for academic, religious, charitable, artistic, social or other non-profit purposes may become a corporation with the permission of the competent authority, and the corporation is formed by registering its establishment at the location of its main office. This page focuses on incorporated foundations.

What are the requirements to establish a foundation?

(1) Contributed assets and articles: the founder of a foundation must contribute certain assets and prepare and sign articles of incorporation stating the purpose, name, office location, provisions on assets, and provisions on appointing and dismissing directors.

(2) Permit criteria (public-interest corporations): the purpose business must be specific and feasible, the income from contributed assets must be able to achieve the purpose business smoothly, and the business must actively maintain and promote the public interest.

(3) Officers (public-interest corporations): there must be 5 to 15 directors and 2 auditors (the number may be changed with the authority's approval), a majority of directors must be Korean nationals, and persons under 18, adults under full or limited guardianship, and bankrupts who have not been reinstated, among others, cannot be officers. Officers take office with the approval of the competent authority.

Which documents are needed?

Submit to the competent authority the establishment permit application with: (1) a document stating the founders' names, addresses and backgrounds, (2) a statement of the purpose of establishment, (3) the articles of incorporation, (4) an inventory of property stating the type, quantity, value and rights of the contributed assets (divided into basic and ordinary assets) and a donation application, (5) certificates from registry offices or financial institutions for the main assets such as real estate, deposits and securities, and (6) the planned start date of business and a business plan and income/expenditure budget for the first 2 business years.

What is the procedure?

(1) Draft the articles and secure the contributed assets → (2) submit the permit application and documents → (3) examination and permit by the competent authority (conditions may be attached) → (4) transfer the contributed assets without delay after the permit and submit a property-transfer report within 3 months → (5) register the establishment at the main office location within 3 weeks of the permit → (6) submit a registration report within 7 days of completing registration. Contributed assets become the corporation's property from the time the corporation is formed.

How long does it take?

The processing time for the establishment permit should be confirmed with the competent authority. After the permit, the establishment must be registered within 3 weeks, proof of the asset transfer submitted within 3 months, and the registration report submitted within 7 days of completing registration.

Which authority receives the application?

Apply to the competent authority in charge of the business; if the business falls under 2 or more authorities, apply to the one in charge of the main business. The specific authority depends on the purpose business, so confirm with the relevant authority.

What are the statutory fees for establishing a foundation?

The application fee for the establishment permit should be confirmed with the competent authority. Registration may involve separate costs such as registration and licence tax, but this page does not give amounts.

Why is a permit application returned?

Cases where the permit criteria confirmed in the law are not met: the purpose business is not specific or is unlikely to be feasible, the purpose business is hard to achieve with income from the contributed assets, or it is not recognised as maintaining and promoting the public interest. Missing mandatory items in the articles or incomplete property inventories and certificates also lead to supplementation requests.

What can an administrative agent help with?

YouSun Administrative Agency prepares the establishment permit application, statement of purpose, articles of incorporation, business plan and other documents and submits them to the competent authority on your authorization. Representation in filing the corporate establishment registration is the work of a beopmusa (certified registration professional), as is registration of the asset transfer, so these are not handled. Work restricted by other laws cannot be handled, and litigation or court representation is outside the scope of an administrative agent and is not offered. Whether a permit is granted is decided by the competent authority.