Korean New Deal & Covid-19: Support to foreign companies in Korea

Korean New Deal & Covid-19: Support to foreign companies in Korea

Thanks our cooperation with KOTRA and the foreign Ombudsman in Korea, here is a Q&A on the access to public support for foreign companies.

Following our webinar on government's support package to companies amidst the outbreak of the sanitary crisis which causes liquidity issues for the private sector, the French-Korean Chamber of Commerce and Industry provides you here some answers to the specific concerns of foreign-invested companies. We warmly thank Mr. Sung Jin KIM, Foreign Investment Ombudsman, for his valuable support and his participation to our last webinar!

 

Q1: Is it possible for foreign firms to take part in  the public tender for the Korean New Deal projects that the Korean government is pushing ahead?

The Republic of Korea is a contracting party of the Agreement on Government Procurement (GPA) of the WTO, which means public tenders on central government, sub-central government and designated public entities above a certain amount of money must be open to foreign companies (Please refer to here for the list of designated public entities).

The threshold varies according to the type of tender, project owner as below

Q2: Is there any government support program for the tourism sector which is one of the hardest-hit industry by the pandemic?

The Ministry of Culture, Sports and Tourism (MCST) is operating the Tourism Promotion and Development Fund to support tourism business. And the Korea Tourism Organization is running the Tourism Support Business Support Center for the companies in this sector. Furthermore, the Enforcement Decree of the Foreign Investment Promotion Act has newly been amended to designate newly established “Sports Industry Promotion Facility” as an individual-type foreign investment zone.

 

Q3: Is every foreign-invested firm eligible for cash grant regardless of the industry?

The cash grant program is for either (1) high technology, or (2) job creation. More concrete conditions are stipulated in the Article 14-2 of the Foreign Investment Promotion Act.

For more information on cash grants, click here.

 

Q4: There is a certain limit of employment proportion (1/5) among Koreans and non-Koreans when it comes to E-7 visa. For digital firms, there is a 2-year grace period. Is there any plan of expansion of such grace period to other sectors to promote future industries?

The 2-year grace period is already expanded to other areas such as manufacturing, trading, consulting and R&D, etc. since 2015.

 

Check out the full document relative to the Korean New Deal:

Click here

 

Do you need help as a foreign-invested company in Korea? Submit your request here!

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