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Sep 26, 2013

Due Diligence for Law Firm in Korea Buying Company via Merger

Intending to do a joint venture with a Korean company? Buying a company in Korea? Licensing technology to a Korean company? OEM with a Korean supplier? Selling to a Korean company?

Before going to bed with a Korean company do a little due diligence.  The motivation for this article is an article by my friends over at the China Law Blog.

Due diligence in Korea is not much different than due diligence in China.  The China Law Blog notes, in part, that after do a basic search on the internet a company should:
"Then do your due diligence the old fashioned way.  Ask your potential Chinese counter-party for relevant documents showing its various registrations and financial condition.  In particular, get its tax returns.

And if your potential counter-party will not turn over what you reasonably seek? Seriously consider walking away.  In our experience, legitimate Chinese companies do not balk at providing documents that reinforce that they are who they say they are.
And if your potential counter-party does turn over the documents you reasonably seek?  Then get someone who truly knows what he or she is doing to thoroughly review those documents."  It is that simple.
 I wrote a few more articles on this issue that may be of interest to the reader:


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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 25, 2013

Korean Agricultural Opportunities in Seoul for Foreign Technology Companies Law

The Korean Ministry of Agriculture, Food & Rural Affairs has proposed establishing a nearly USD 2 billion fund for improving, among other things, farming productivity in Korea.  The fund is intended to lead to the doubling of Korea's agricultural product exports.

The proposal was made in a government meeting chaired by Korea's president, thus, indicating that the plan has significant weight behind it.

When these funds are in the works, Korean companies, often, are eager to partner with foreign technology companies in order to garner the necessity licenses and know how to bid on projects.

Opportunities abound in agricultural tech in Korea, since Korea is decades behind most other developed countries in agricultural productivity.   We are surprised to see many of the leading players in the West not have an active presence in Korea, because of a total lack of interest by Korea's aggregators.  This may all change with the implementation of this fund.  We suggest having your presence known in Korea and, promptly, contacting the major players in Korea.  This may be a great opportunity for foreign tech companies and the Korean agricultural sector.

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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 24, 2013

Discriminatory Treatment Definition Expanded in Korea for Non-Regular Workers: : Employment & Labor Law Update

Last March, the Korean National Assembly made changes to the Korean Labor Standards Act that may have a significant impact on companies doing business in Korea that employ non-regular workers.  The changes modify the definition of what constitutes "discriminatory treatment" against these non-regular workers.

In the old version of the Korean Labor Standards Act ("KLSA"), the definition of discriminatory treatment was listed as “unfavorable treatment in terms of wages, other working conditions, etc. given without any justifiable reasons.”

In the amendment to the KLSA, the definition has been expanded to include “regular bonuses, holiday bonuses, other bonuses that the employer pays to a worker as remuneration for work on a regular basis, incentives paid based on management performance, and other issues related to the working conditions and welfare benefits.”  The amendment, facially, imposes a significant added burden on companies with non-regular and regular workers.

In addition to the expanded definition, the KLSA now requires employers to "proactively" check whether or not there is a difference in the working conditions of non-regular and regular employees.  As always, enforcement and court cases will determine the added cost imposed by this amendment.  We will update the reader on enforcement actions.

We have put together and are implementing a proactive and hands-on human resources audit program to determine the added risks imposed by the changes to Korea's labor and employment law for clients that have taken advantage of our compliance audit and risk analysis program.  If you have never conducted a compliance audit - please do.  Many of the more proactive of firms have offered these programs to clients.

Here are some other articles about Korean labor and employment law that may be of interest:


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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Stock Options in Closed Korean Corporations

For stock options in Korea to be exercisable, thus valid options, the option must be approved, in most cases, at a general shareholders meeting of the Korean company.  If approval of the shareholders is obtained the articles of incorporation of the Korean company should, inter alia, note:
  1. An intention that a stock option may be granted in specified cases; 
  2. The number of shares to be issued or transferred in the case of exercising the stock option; 
  3. Qualifications of a person to whom a stock option is to be granted;
  4. Exercising period of the stock option; and 
  5. An intention that the granting of the stock option may be revoked by a resolution of the board of directors in specified cases. Korea Commercial Act art. 340-3(3)1. 
Additionally, the company granting the options should execute an agreement with the individual granting the options and the stock option should, only, be given to authorized recipients.

If your company in Korea intends to grant stock options or have received stock options in Korea please consult with an attorney that deals with these type of matters.  I have seen a recent incident that could have been avoided if the company and the employee, simply, had a counsel that was not, only, aware of Labor and Employment Law.

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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 17, 2013

Japan's export economy further suffers after South Korea bans fish from Japan

The government of Japan announced last week that, at a cost of USD 470 million, they would build a “frozen wall of soil” around the base of the destroyed Fukushima nuclear reactor.  The ice wall will supposedly, once and for all, stop the reactor's irradiated water from leaking into the ocean.  Japan still faces import bans on much of its food exports and is doing everything it can to help put the disaster behind it.  Unfortunately, recent news out of South Korea shows that Japan is still having a hard time convincing its neighbors that it has the situation under control.

On September 6, 2013, South Korea responded to pressure over public fears that fish imported from Japan's Fukushima Prefecture was unsafe by instituting an even more extensive ban on Japanese fisheries. The new ban covers nearly 430 miles of Japanese coastline that surrounds the affected area – a much larger area than the previous ban, which targeted Fukushima Prefecture alone.

Japan’s government responded by saying that all fish exported from areas affected by the nuclear disaster are checked extensively before being exported, and that they would bring the case to the World Trade Organization if the matter wasn’t quickly resolved.  An article in the Korean Herald was quick to note that both China and Taiwan, immediately after the disaster, imposed a total ban on Japanese imports, yet received no such threat by the Japanese government.  Peculiar?

Japan exports about USD 92 million worth of fish per year to Korea.  That doesn’t sound like much, but when coupled with the Chinese, Taiwanese, and several other countries' bans, the sum begins to matter for Japan. With so many of Japan's industries threatened with import bans, it seems like they are now ready to fight tooth-and-nail over every area they can.  The total amount of economic damage done to Japan as a result of the nuclear disaster is unclear, but there are some estimates that push the price tag beyond USD 250 billion.  Ouch.   We doubt that the Korean government will budge.

For example, the United States found out the hard way that getting back into the Korean market after being forced out is not easy.  In 2003, after a case of mad cow disease was reported in Washington State, South Korea slapped a total ban on imports of U.S. beef.  Before the ban, U.S. exports to Korea were worth around USD 815 million.  Many premium cuts of beef in Korea are considered less than premium in the United States, thus, the margins for exporting to Korea tend, also, to be quite high.

In 2006, the U.S. tried to enter the market again, but bone chips found inside a shipment ended up killing the attempt.  Finally, in 2008, the U.S. was able to get back into the market with the market size now near to the pre-ban level.

The U.S. beef ban, like many issues involving perceived foreign malfeasance in Korea, is exasperated by the South Korean media.  The beef's effect on the safety of the South Korean public were exaggerated (some data was even proven falsified), people became angry, and nation-wide protests were had.  To this day, the reputation of U.S. beef in the Korean market is still tainted and, as recently as last year, South Korea's government floated the idea of once again banning U.S. beef.  The issue ended up being quietly settled behind closed doors after vigorous complaints by the U.S.

It should be painfully obvious to Japan, perhaps more so than any other country, that the Korean government is adept at shaping their public's opinion.  Knowing this, Japan needs to tread carefully to avoid experiencing yet another loss to its export market.

Cleaning up after a nuclear disaster is not as simple as disposing of infected cows.  Korea instituting a near-total shutdown of fishery imports from Japan would harm the industry there for years to come.  Fallout from the Fukushima nuclear reactor is seemingly leaking into nearly every area of the Japanese economy, and it remains to be seen what the total consequences of the disaster will be.




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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Happy Chuseok from IPG Legal

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info@ipglegal.com

Sep 16, 2013

2013 World Economic Forum to be Held in Mongolia - Foreign Investment Likely Tops Issues

The 2013 World Economic Forum will be held in Ulan Bator, Mongolia on September 14th, 2013.  The annual forum’s focus this year is going to be on the “future of Mongolia’s economy.”  When representatives from the Mongolian government and the international group of invitees get together, the issue of foreign investment is likely going to be the chief concern on everybody’s mind.

Mongolia’s economy has been driven chiefly by foreign investment and mineral exports since it began its transition to a market economy in the early 1990’s.  Mongolia is rich in natural resources.   IT has one of the world’s largest coal deposits.  Besides coal, copper, tin and other ores are its chief exports.  Even though the country still struggles with high rates of corruption, and is still in the process of establishing a functional legal system it has managed to grow at very respectable rates during the last few years.

Mongolia was the world’s fastest-growing economy in 2011, growing at a rate of 17.5%.  In 2012, the per-capita income was USD 3,000, up from USD 450 just 12 years earlier.  It was famously dubbed by Renaissance Capital as the world’s “Wolf Economy,” and was expected to surge to new heights due to its large amount of natural resources and an apparent ability to balance Russian and Chinese attempts at economic hegemony.  It has successfully attracted the attention of other countries beyond its periphery, such as South Korea, Japan, Canada and the United States that can conveniently act as counters to the two Asian giants that sit menacingly to its north and south.

Mongolia’s economic data has not been perfect, however.  In the first half of 2013, foreign investment has dropped off by 40%.  A recent law passed in 2012, called the Strategic Entities Foreign Investment Law, may be the prime culprit.  The law requires state-owned foreign enterprises to obtain Mongolian government approval before being allowed to have an ownership interest in a Mongolian joint venture company of more than 33%.  The law primarily targets Chinese consortiums, which Mongolia fears have gained far too much influence in the country.

Wanting to cut off the Chinese, politically, might seem like a good idea for Mongolia.  However, economically, I think that they’ll soon learn that it’s easier-said-than-done to stave off the Chinese embrace.  Mongolia has found itself in a similar boat to other countries that must tolerate, however begrudgingly, Chinese dominance of their mineral export industries.  Come September 14th, the World Economic Forum will meet, debate these issues, and perhaps even come up with a few solutions that may end up helping Mongolia’s economic development along.  All of their idealistic discussions about Mongolia's future, however, must still take into consideration the cold reality that China and Russia are the hungriest for Mongolia's minerals - and they're right next door.

Mongolia is still a relatively new democracy and, like so many other mineral-rich countries, is today presented with an historic opportunity to effectively manage its natural resource export industry in such a way as to legitimately develop itself into a prosperous independent democracy.  Unfortunately, the lessons of history speak against Mongolia retaining either its sovereignty or economic independence from the self-interested designs of its more-powerful neighbors.  Time will tell whether or not the wolf can finally manage to outsmart both the dragon and the bear.

What do you think? Will the World Economic Forum’s visit to Mongolia be useful for the country’s development?
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info@ipglegal.com

Sep 11, 2013

Spectre of Economic Problems Brought by Previous Olympic Games Hangs Over Japan

On September 7, 2013, Tokyo was chosen as the host city for the 2020 Summer Olympic Games. Japanese Prime Minister Shinzo Abe has been eager to finally pull his country out of its nearly 20-year-long economic slump, and this may be exactly what Japan needs.

The Tokyo Metropolitan government is expecting to spend about JPY 3 trillion (USD 30 billion) on preparing the city to host the Olympics, which should lead to an estimated 152,000 jobs being created. The bulk of the stimulus money will likely be spent on constructing sports venues large enough to host the Games, an expected expansion of the city’s two airports, and general infrastructure improvements within the city.

After the bid was announced, Japanese citizens ran into the streets to celebrate.  Few expected Tokyo to win the bid over Istanbul.  Hosting the Games could indeed be a wonderful cure for Japan’s economic malaise, but if it’s a cure at all, it may only be a short-term one.

In 2004, citizens of Greece were filled with the same sense of hope as Japanese citizens today. Economic forecasters back then predicted similar gains of this or that nature, and almost every news outlet in the world was in general agreement that hosting the Games was going to be the best thing to happen to Greece since it began the very first Olympic Games millennia ago.  The games came and went, everything seemed fine, and then the problems started to become clear.

Greece, after all was said and done, ended up spending nearly USD 11 billion to host the Games – more than twice its initial budget.   Just a few years after the Games finished, all of the grandiose and expensive stadiums were left unused and derelict.  The stadiums, which no longer had patrons visiting them or athletes competing in them, were expensive to maintain, and became a drain on the country’s resources.  Greece responded to the problem by spending even more money, deciding to abandon some of the structures and attempting to convert some of them to other uses.  Nearly a decade later, a solution still hasn’t been found, and most empty stadiums still stand – covered in trash and weeds.  Today, the 2004 hosting of the Games is considered to have been an economic disaster for Greece, a net loss as opposed to a net gain.  To what extent the 2004 Olympics contributed to Greece’s current economic situation is anybody’s guess.

Then there’s China in 2008.  Today, the former Olympic structures are prime locations for amateur filmmakers who want to film movies with post-apocalyptic settings.  I have personally visited Beijing’s Olympic Park in 2011.  The paintjob on the Bird’s Nest’s is peeling off and the whole structure seems as if there hasn’t been any upkeep since 2008.  Parts are broken, and everything looks quite cheap.  Chinese soldiers regularly march around the nearly-abandoned Olympic Park, which now only hosts a few bored tourists – a miniature ghost town inside one of the world’s largest cities.

The Watercube, in a country where almost nobody knows how to swim, has been converted into a small waterpark.  You will find very few visitors.  The ceilings are leaking in several spots.  The water is collected into buckets.

The jury’s still out on London, but due to what happened in Greece and China, forming contingency plans for post-Olympic uses of all stadiums has become a regular practice.  I trust that London will not make the same mistakes as Greece or China.  Hopefully, Japan, also, will not.  It may take several years after 2020, however, before a complete economic assessment of the 2020 Games’ result can be had.

What do you think? Will hosting the Olympics in 2020 be beneficial to Japan?
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info@ipglegal.com

Sep 10, 2013

Benefits on Vietnam-Korea FTA: Korea's Nuclear Exports

South Korean President Park Geun-Hye, after making trips to the U.S. and China earlier this year, recently made her third overseas visit to Vietnam.  The two countries are in the process of negotiating a new Free Trade Agreement (FTA) that my come into effect as early as 2014.

According to local media sources, the FTA negotiations touched on the usual issues of labor exchange and economic cooperation.  What was of particular interest, however, was South Korea’s bid to export their nuclear reactor technology to Vietnam.  Vietnam is looking to build 10 reactors by 2030, and South Korea is hoping to build, at least, two of the 10.  We wonder whether the recent issues with Korean nuclear reactors will harm the chance of Korea in winning a bid in Vietnam.

South Korea, in the midst of a push to increase exports of its nuclear technology, was also recently awarded a USD 20 billion contract to build four nuclear reactors for the UAE.  The first of those reactors is already under construction.  South Korea’s Ministry of Knowledge Economy (MKE) has declared that it aims to become the world’s third-largest supplier of nuclear reactors by 2030, behind the USA, France and Russia.

South Korea currently fields four nuclear reactors, with six more planned (and five currently under construction).  .

What do you think?

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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 9, 2013

South Korean OPCON Transfer Might Be Delayed Again

Daniel Russel, U.S. Assistant Secretary of State for East Asian and Pacific Affairs, arrived in Seoul yesterday to negotiate a timetable for South Korea regaining wartime Operational Control (OPCON) over its military.   The U.S. first gained control of South Korea’s wartime OPCON in 1950, at the start of the Korean War, and has yet to relinquish it.   South Korea regained its peacetime OPCON in 1994, but has repeatedly postponed previous attempts at regaining wartime control.  Again, Korea is requesting a delay.

The transfer of OPCON could be a major benefit to those selling technology, services and hardware to the Korean government.

U.S. Defense Secretary Donald Rumsfeld first floated the idea of transferring wartime OPCON back to South Korea’s military in 2001.  South Korea, it was said, was now a wealthy post-developing nation and should be fit to command and control its own military in the event of a war.   In 2007, it was decided that 2010 would be the year that South Korea would finally regain control.  Before this could happen, however, North Korea sunk the South Korean warship Cheonan in early 2010, which led to a scuttling of the plans.  A South Korean documentary about the ship’s sinking opened in theaters last week in Seoul.

2015 is the new "tentative" date for a final transfer of military OPCON to South Korean. This should coincide with the additional plans of U.S. Forces Korea (USFK) to officially change its name to Korea Command (KORCOM) and finally close Yongsan Garrison.  The U.S. has long desired to move from Yongsan Garrison, which sits north of the Han River, and at a strategic position to quickly deploy troops as a “tripwire” force against possible North Korean aggression, to Camp Humphreys, which sits south of the Han river – a distance that may make it a little safer for American troops.

The U.S., after recently making a strategic re-pivot toward Asia, is making curious moves.  Certainly nobody expected the U.S. to intentionally reduce its military presence on the continent – or deliberately reduce its role as the security guarantor of almost every Asian country it can possibly grab ahold of on China’s periphery.  And yet, that seems to be exactly what is happening.  In Japan, there is talk of changing the country’s constitution to finally allow for the fielding of a proper military.  The U.S. seems willing to even let Japan off the leash.  One can’t help but think that sequestration has actually managed to affect U.S. national interests – something that everyone promised it wouldn’t do.

Unfortunately for South Korea, though, it seems like the U.S. is drawing down almost everywhere, and is no longer interested in shouldering the burden of its security guarantor.  Korea needs to quickly increase its command and control abilities, while purchasing more military hardware.  At present it places too much reliance on the U.S. military. 

What do you think? Is South Korean wartime OPCON going to finally transfer on time? What do you think about South Korea finally getting wartime control of its military?


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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Mooncakes to be Banned as Gifts by Chinese Officials

Mooncake, a Chinese delicacy, is a sweet and tender pastry with an egg yolk in the center.  Mooncakes are used as gifts to present to families and friends during the Zhongqiu, a holiday celebrated on the 15th of the 8th month of the Lunar Calendar, a tradition and/or holiday similar to that of the Western Thanksgiving.  Mooncakes are an important part of the festival and a symbol respecting the tradition.

However, some Chinese government officials have been using public money to purchase expensive mooncakes as gifts.  It has been reported by CNN that these simple pastries can be packaged luxuriously and can cost up to $300.  The issue with these gifts is that sometimes not, only, mooncakes are in the package, but other goods, such as "high-grade tea leaves, bottles of alcohol or hidden envelops of cash." A small gesture of friendliness may, sometimes, be nothing more than a bribe.

With the problems of bribing influential people, Xi Jinping, the current President of China, has set new laws, banning the purchasing of mooncakes as gifts with public money.  However, even if this new restriction has taken place, will Chinese officials, simply, find alternative gifts to use for the same purpose?

An article written by CNN regarding this issue can be found at: Chinese government cracks down on mooncakes. 
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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 5, 2013

The Amended Commercial Building Lease Protection Act of Korea Regarding Renewal Rights/Terms for Commercial Leases in Korea

The Commercial Building Lease Protection Act ("CBLP") came into force on August 13, 2013.  The amendments, mentioned below, will solely come into force for leases entered into after August 13, 2013.  The changes will assist those with large deposits from getting the boot by a landlord based on no apparent reasons.

Renewal/Terms for Commercial Tenants with Deposits over KRW 300million  (Major Tenants)

Under the former CBLP, tenants with deposits of over KRW 300,000,000 (For Seoul) were not protected with the right to renewal of a commercial lease.  The Presidential Decree to the CBLP proscribes who is a "major tenant" based on the location of the space.  A Major Tenant is Seoul is deemed by a Presidential Decree to be a tenant with a deposit of over KRW 300,000,000.  The amount, in many parts of Korea, are significantly lower than KRW 300,000,000.

The present CBLP specifics that all commercial leases under 5 years in length must be renewed if requested by the tenant unless the landlord is able to establish justifiable reasons for not renewing (e.g. non-payment of rent).  The issue of the amount of rent and deposit will, however, still be a factor in coming to a agreement.

Additionally, the amended CBLP allows tenants to request an increase or decrease in rent or lease deposit based on a myriad of factors including the specific economic situation in the area.

Renewal/Terms for Commercial Tenants with Deposits under KRW 300million

All landlords of commercial properties with deposits under the amount specified in a Presidential Decree to the CBLP (KRW 300,000,000 in Seoul) are, additionally, prohibited from raising rent or deposit for a tenant more than 9%.  The protection is not available for tenants with deposits over the amount specified in the Presidential Decree.

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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 4, 2013

7th Round of Negotiations on Free Trade Agreement between South Korea and China

Today, China and South Korea began the 7th round of Free Trade Agreement (FTA) negotiations in Shandong Province, China. The negotiations are expected to last until September 5th.

According to Xinhua News, the previously-held 6th round of the negotiations led to resolutions in the countries’ disagreements over “services, investment, rules of origins, customs clearance, trade remedies and intellectual property rights.” The current round of talks should be focusing on “agriculture, manufacturing industries, including automobile, machinery and oil sectors.”

China is South Korea’s largest trading partner so the upcoming FTA has the possibility to dramatically impact South Korea’s economy.  In 2009, Korean exports to China totaled USD 86 billion, with imports from China totaled USD 54.2 billion.  Contrast that with Korea’s trade with the United States in the same year – with exports to the U.S. totaling just USD 37.7 billion and imports from the U.S. totaling USD 29 billion.

Last year’s Korea-US FTA is still a somewhat contentious issue in that the results of it have yet to be fully realized.  Neither South Korea nor the U.S. seems to have benefit ted much from its enactment.

The existence of a Korea-China FTA likely sends a worrying message to the U.S., whose relationship with China is apparently permanently strained. South Korea, despite six decades of a strong military and economic alliance with the U.S. is still, and has been for quite some time, economically reliant on the Chinese.  As we know, the Chinese are reliant on the U.S. (decoupling not yet occurring).

South Korea’s perspective, however, is completely different.  It is now in an advantageous position where it can balance the concerns of its biggest security benefactor, the United States, against the needs of one of its biggest economic benefactors - China.  In the middle of this, Seoul has also been floating ideas about resuming talks for a Korea-Russia FTA and, somewhat surprisingly given the current state of affairs, even a Korea-Japan FTA.

Korea, historically, is no stranger to playing host to the insecurities of neighboring superpowers.  For maybe the first time in its history, however, the same unfortunate geographical quirk which placed Korea right between three much more powerful states now seems to be working in its favor.  South Korea is finally free and secure enough to safely balance the interests of its much more powerful neighbors to its own benefit, without fear of military intimidation.

When South Korea begins to finalize the contents of its FTA with China, the U.S. may be hoping that it remembers exactly why that is.

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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 3, 2013

Proposed Amendment to Real State Development Business Act of Korea: Rating of Real Estate Development Projects

In an attempt to avoid additional failures in the Korean real estate market, the Korean government at the end of July 2013, proposed revisions to the  Real Estate Development Business Act of Korea.

The revisions would, inter alia,:

1.  Give authority to the Ministry of Land, Infrastructure and Transport ("MLIT") to select a agency of real estate experts ("Agency of Experts") to verify private ratings.  The specifics of this Agency of Experts scheme would be designated by a President Decree.  The purpose of the revision is to have an analysis by a true "neutral."  As in most cases, the devil may be in the details.

2. Officially recognize the practice of the MLIT of delegating responsibilities to local Korean governments.  These delegated responsibilities include issuing real estate registration certificates.

We will update the reader if the law passes

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SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com

Sep 2, 2013

Korean government still too Lenient with Korean Visa Regulations

According to a new article in the Korea Herald based on government data, nearly 3 out of 10 short-term foreign visitors to South Korea stay here illegally.  The story didn’t specify exactly what an “illegal stay” meant, but it did take the time to classify the nationalities of the offending foreigners – 43.7% of them were Chinese, with the next-biggest group of offenders being Thais at 19.4%.

What we found most interesting about the article is that it attributes the uptick of offending foreigners to “the government’s streamlining of visa issuance procedures to attract more tourists.” The article seems to imply that visas to South Korea should be much more difficult to obtain.

Public outcry, in every country, is often a precursor to government action.  In January, 2011, South Korea began mandating that foreign English teachers seeking work on an E2 visa would require criminal background checks – no doubt as a result of public dissatisfaction with various crimes committed by foreigners.  English teachers are often an easy target for public distrust in the foreign community, since there’s such a large number of them currently working here.

We’ve finally seen the Chinese government act likewise.  In July, 2013, suddenly and with almost no warning whatsoever from the Chinese government, visa requirements for foreigners were abruptly changed.  Now, foreigners who intend to work in the Chinese showcase cities of Beijing, Shanghai, Shenzhen, Nanjing and Suzhou will require a criminal background check, and in every city in China, even foreign tourists on short-term tourist visas must now seek an “invitation letter” from a Chinese tourist company before they will be allowed to apply for a visa.

How should these governments juggle public cries for tougher visa restrictions with the need for a steady flow of foreign money and talent into their countries? What do you think?

The Korean Herald article mentioned in this article may be found at: 30% of Foreign Short Term Visitors Stay Illegally

Here are some other articles about Korean immigration law by The Korean Law Blog:
_________
SeanHayes@ipglegal.com

IPG is engaged in projects for companies and entrepreneurs doing business in Bangladesh, Cambodia, China, Korea, Laos, Myanmar, the Philippines, Vietnam and the U.S.

www.ipglegal.com