Subscribe | LinkedIn Group

Aug 23, 2011

Foreign-Capital Invested Companies in Korea Subsidies for Employing New Workers in Seoul, Korea

The Seoul Government has issued the following official notice in order to inform foreign-capital invested companies of a program to partially subsidize the wages of newly hired Korean employees. 

We have recently advised clients eligible for this program in our quarterly legal update.  We have also advised on the numerous other new tax holiday, incentive, and other programs available to foreign businesses operating in Korea and will be posting some of these updates on this blog over the next couple of weeks.  We think this program is immediately useful for many of the readers of this blog.  Please promptly apply for the benefits and we highly recommend learning more about the numerous other benefits available to foreign-capital invested companies in Korea.

The following is the Official Notice issued by the Seoul Government.      
___________________________________
Notice No. 2011 - 1289
Seoul Metropolitan Government (SMG), under the Seoul Metropolitan Government Ordinance on Support for Foreign Investment (Articles 15 and 16) and the Enforcement Rule of the Seoul Metropolitan Government Ordinance on Support for Foreign Investment (Articles 6, 7, 8, and 10), hereby announces the 2011 payment plans for Employment and Training Subsidies for foreign-invested companies in Seoul. Thus, please refer to below and submit the application for 2011 Employment and Training Subsidies.

August 1st, 2011
Mayor of Seoul
Employment and Training Subsidies - 2011

□ Eligible Applicants
- Foreign-invested companies whose business areas are within the
category of the SMG's new growth engine industries
※ SMG's eight new growth engine industries : Business Service, Finance,
Tourism&Convention, IT Convergence, Biomedical Technology, Green
Technology, Design&Fashion

□ Type of Subsidies
- Employment Subsidy : When a foreign-invested company hires more
than twenty Korean nationals within five years after the initial
investment
- Training Subsidy : When a foreign-invested company offers training
to their new employees in the designated vocational training centers

□ Requirements
- The number of Regular Employees during the eligibility period
should be more than twenty.
(Eligibility Period: from January 1st 2010 through December 31st 2010)

※ Regular Employee: Average number of reported wage earners for the period
of three consecutive months from the reference date.
- 30% or more foreign ownership

※ This excludes ownership shares of both Korean nationals and corporations.
- To be eligible for the Training Subsidy, companies should offer
education and training to their new employees in the vocational training
centers designated under the Vocational Education and Training Act

□ Subsidy Amount
- Up to KRW 0.5 million in monthly subsidies for each new employee
for no more than six months
※ The subsidy amount and period will be decided after deliberation of the
Seoul Foreign Investment Support Commission.
- 2011 Budget : KRW 1,008 million

□ Obligations
- Subsidies must not be used for any purpose other than employees’
wages, incentives or benefits, and must be managed on a separate
account
- Companies must have maintained the appropriate number of Regular
Employees and 30% of foreign ownership for three years as of the
date of application
- Companies must consult with SMG in advance if they plan to
relocate to another city or country within a period of five years
from the date of receipt
- If it is found that a company has violated any of the obligations
described herein, or has obtained subsidies illegally, subsidies already
paid must be recovered from the applicant or company under the
SMG Ordinance on Subsidy Management (Article 21)

□ Application
- Period : September 15th ~ September 30th, 2011
- To apply, please visit the office or mail the completed application
form along with other required documents to the following address
(must be postmarked by September 30th)
- Office: Investment Promotion Division, Economic Promotion Headquarters, SMG
l Tel : 2171-2842
l Address : Press Center Building fl.10, #25 Taepyeongro 1-ga, Jungu, Seoul
- Required Documents
l Application form
※ The form can be downloaded at SMG web site (http://www.seoul.go.kr)
l Registration certificate of a foreign-invested company registration
l Performance report on withholding income tax (October ~
December 2009 and October ~ December 2010)
l Confirmation letter of employment insurance acquisition
l Financial statements
l Personal information of the applicant
∘ Foreigner : Certification of Domestic Residence Report, phone
number(Mobile), Alien Registration Number
∘ Korean : Certificate of Residence, phone number(Mobile)
l Documents detailing investment made in Seoul between 2010 and
2011 and future investment plans (Annual plans for up to 2013)
l Real estate documents (e.g. real estate contracts)
 ※ If necessary, companies may be required to submit additional documents.
_____
SeanHayes@ipglegal.com