DEFINITION OF FOREIGN DIRECT INVESTMENT
To be protected as a foreign investor under the newly established "Foreign Investment Promotion Act", a foreign national must invest enough to acquire 10% or more of stocks or of proprietary interest in a legal person or enterprises in Korea. However, if evidence in the joint investment contract shows that the foreign national participates in the management of the company concerned, an investment less than 10% is to be considered FDI. If an established foreign invested corporation receives loans with a maturity of five years or more from its overseas parent company or borrows from an affiliate of the company which has a capital relationship with the overseas parent company, this is also to be considered foreign direct investment.