Immigrant Investor Scheme for Real Estate
Introduction to IISRE
The Immigrant Investor Scheme for Real Estate (IISRE), introduced for Jeju Island in February 2010, is a government program which gives F-2 Residential status to foreigners investing a certain amount money in real estate designated by the Minister of Justice, and the foreign investors will get F-5 Permanent Resident, if they hold onto the purchased real estate for at least five years.
Investments for the Application of IISRE
- Resort condominium business as prescribed in Article 3 (1) 2 (b) of the Tourism Promotion Act and in Subparagraph 15 (b) of Attached Table 1 of the Enforcement Decree of the Building Act;
- Accomodations business in Subparagraph 15 (a) of Attached Table 1 of the Enforcement Decree of the Building Act;
- Villa business as prescribed in Article 28 of the Enforcement Decree of the Local Tax Act, in Article 168 (3) of the
Enforcement Decree of the Income Tax Act, and in Article 92 (10) of the Enforcement Decree of the Corporate Tax Act;
- Tourist pension business as prescribed in Article 3 (1) 7 of the Tourism Promotion Act and in Subparagraph 15 (d) of
Attached Table 1 of the Enforcement Decree of the Building Act;
- Housing construction in connection with sports facilities as prescribed in Article 9 (3) of the Special Act on Designation and
- Management of Free Economic Zones, in Article 3 (2) 8 (e) of the Housing Supply Regulations, and in Administrative Act NO
. 2012-323 of the Ministry of Knowledge Economy.
Real Estates Designated for the Application of IISRE
Regions that fall under the IISRE are Pyeongchang in Gangwon-do, the Incheon Free Economic Zone, Jeju-do, Yeosu in Jeollanam-do, Haeundae and the East Busan Tourism Complex in Busan, Paju in Gyeonggi-do according to Administrative Act NO. 2015-317 of the Ministry of Justice as of 2015.
Regions under the IISRE
Pyeongchang Incheon Free Jeju-do Yeosu Busan Paju
Gangwon-do Economic Zone Jeollanam-do Gyonggi-do
Investments Alpensia Resort Songdo Jeju Special Self- Yeosu Gyeong-do Haeundae Tourist Tongil Dongsan
International City, governing Ocean Tourist Resort,East Busan Zone
Yeongjong District, Province Resort Tourism Complex
Minimum 500,000 USD 700,000 USD 500,000 USD 500,000 USD 500,000 USD 500,000 USD
Investment (500 million KRW) (700 million KRW) (500 million KRW) (500 million KRW) (500 million KRW) (500 million KRW)
Amounts for East Busan
Investment ’13.05~’18.04’ 13.05~’18.04’ 13.05~’18.04’ 13.05~’18.04’ 13.05~’18.04’ 15.11~’20.10
* Source : Administrative Act NO. 2015-317 of the Ministry of Justice (2015); Subparagraph 27 of Attached Table 1 of the Enforcement Decree of the Immigration Control Act.
Investors who wishes to reside in Korea can enjoy the same benefits as Korean citizens do, including eligibility for public education, health care, employment, and welfare, as well as permanent residency through the IISRE.
Incentives of the IISRE
Permanent residency: Investors can gain F-2 if they invest up to 700 million KRW in a real estate designated by the Ministry of Justice, and then acquire the right of permanent residence (F-5) after 5 years.
Guarantee of Mobility: Investors can freely visit to or reside in other regions beside ones under the IISRE after reporting a change in their place of temporary residence.
Education: Investors can get public education as Korean citizens do or register the International School in Juju’s Global Education City.
Medical insurance: Investors have health insurance coverage as Korean citizens do.
Real estate transactions: Investors can freely divest real estate holdings after getting permanent residency.
Employment: Investor’s spouse or family members can get a job or engage in any commercial activities.
Visas Issued to Foreign Investors and Their Accompanying Family Members
C-3 F-1 F-2 F-5
Type Business visa Visiting visa Resident visa Permanent visa
Validity Period 3 years on condition of 1 year 2 years in the initial visa Permanent
a stay of no more than application, 3 years in case
of applying for the extension
Requirements Purchase or possession More than 100,000USD Purchase or possession Having maintained the
(registration completed) is paid for a deposit (registration completed) qualification of F-2
of recreation facilities and interim payments. of recreation facilities visa for over 5 years
(condominiums, etc) worth (condominiums, etc.) with no grounds for
more than 500,000USD worth more than 500,000USD disqualification
Recipients Investor and his/her Investor Investor Investor
accompanying family ※ Investor’s accompanying ※Investor’s accompanying
member (parents, spouse, family member (spouse family member can apply
children, parents-in-law) underage children) can only only for it after the
for F-1 visa of 2 years investor gets permanent
Advantages It allows you freely to visit It allows small . Even if you reside in Korea, It allows you to engage in
to Korea without applying investors to stay it allows you to visit to real estate transactions
for foreigner registration. Korea and to apply for and to change your
the visa renewal. residence place in Korea
World n.2 Korean passport
(passport qualification index)
Investment immigration is where a foreign individual can apply under the desired countries investment immigration program for a permanent residency visa. This type of visa is only granted where the applicant invests a set amount of money into the country he/she or she wishes to gain a permanent residency visa in. The residency visa is granted on approval of the individual’s investment plan and will enable the applicant to live and carry on business in that country along with his dependants (provided he/she has paid any additional fee incurred for them). Generally, most jurisdictions provide the opportunity for the investor to sponsor his family to reside with him. It is important to acknowledge that each jurisdiction provides for different requirements to be met in order to qualify for a residency visa through investment. The requirements and legal immigration framework of South Korea will now be detailed.
Why immigrate to South Korea?
South Korea is a highly sought after location for many foreign investors seeking permanent residency. It has a strong political and financial infrastructure with a solid and prominent legal framework. South Korea is strategically geographically situated for International business relations and boasts a strong economy with many international business relationships welcomed. South Korea is not the easiest of country’s to obtain a permanent residency visa in and as such the applicant must be aware of the lengthy process associated with South Korean Permanent residency permits.
South Korean law stipulates that foreign individuals are not eligible to apply for a permanent visa unless they are married to a South Korean National or they are a very high net worth individual capable of investing a sum of 50 million won into the South Korean local economy. South Korea immigration law stipulates that where an individual has a business visa and has invested a minimum of 50 million won into a South Korean business then he/she is eligible to apply for a permanent residency visa. An applicant can also apply for a permanent residency visa where he/she has invested a non-financial contribution which has been recognized by the South Korean Justice Minister.
Investment standards have changed in recent years, previously an investment of 50 million won would enable the individual to gain immediate permanent residency. The investment business visa is also known as a D-8 residence visa and is awarded to foreign investors provided they meet the investment criteria.
The conditions to satisfy to gain a D-8 residence permit are as follows:
The applicant must establish a company is South Korea to enter into a partnership with a Korean firm
The applicant must invest a minimum of 50 million won, into the business enterprise
As of 2010 South Korea decided to increase the minimum investment criteria for foreign individuals from 50 million won to 100 million won in a bid to regulate the number and types of foreign investors to South Korea. The country had been experiencing a large number of foreign investors who invest with no intention of creating a business in South Korea. By increasing the minimum amount of investment it ensures that the investors who do apply for a D-8 residency visa are serious about investing in South Korea and living there. Foreign investors into South Korea still require a Korean guarantor despite investing a large sum of money into the economy.
South Korea offers an F-5 visa which is the visa granted for permanent residency. This type of visa is open to foreign investors, sophisticated professionals and directors of multinational corporations.
In order for the applicant to achieve a permanent residence status he/she must:
Invest minimum amount of finds as stipulated by the South Korean Ministry of Justice
Hire a minimum of 5 employees who are Korean nationals
An applicant who has obtained a business visa and who has invested the amount as required into a business enterprise can also seek an F-5 visa. The applicant must be a Korean resident for a minimum of 5 years and have created at least 3 employment opportunities.
Under South Korean law, there are many different types of avenues investors can go down with regards to what they can invest their funds into.
Foreign investment opportunities can be:
Foreign Direct Investment (FDI)
Legal Entity Establishment
Real Estate Acquisition
Investment in Infrastructure
Applicants seeking permanent residency in South Korea through investment have unlimited freedom with respect to choosing the type of business the applicant wishes to invest in. The only conditions which must be adhered to are that the company has to acquire a registration certificate of foreign investment; this certificate has to be authenticated by a Korean bank or Korean trade investment promotion agency.
The application process for foreign investment to obtain a residency permit is as follows:
The applicant must submit the registration certificate of the business enterprise to the Immigration Bureau of the Ministry of Justice.
The Immigration Bureau on receipt of the relevant certified documents will then send the visa issuance notice certificate to the applicant
Once the applicant sends the visa notice certificate to the Local Korean Embassy in his domicile country, a D-8 visa is issued,
The applicant process for investment immigration to South Korea is free of charge.
Benefits of obtaining an F-5 permanent visa:
Free economic activities in South Korea
Exemption from requirement to renew your visa through extension procedures
Exemption from the need to apply for a re-entry permit, a re-entry permit is only required where the applicant stays in a foreign country outside of South Korea for a minimum of 1 year
Exemption from arbitrary deportation
Relevant industrial infrastructure
An area conveniently accessible from world-class ports, airports, highways and railroads
A three and a half hours’ flight from cities with the aggregate population of 2 billion, i.e. 32% of the world’s entire population.
The world’s third largest trading bloc
It is expected that the share of the GDP of Northeast Asian countries will increase to the 30% level by 2020. The world’s 10th largest domestic consumption market comprised of highly cultured consumers
The Mecca of highly sophisticated industries
Maximization of business efficiency with the construction of a U_CITY Operation of foreign-based educational/medical institutions is possible.
South Korea is one of those countries that, while a bit of a mystery to Westerners, has been an amazing success story. I frequently talk about momentum as being an important factor in choosing a country in which to plant a flag. And South Korea has quite the story when it comes to momentum.
Not long ago, South Korea was a migrant country. Like the Philippines today, they sent workers such as farmers, miners, and domestic helpers overseas to do jobs where demand exceeded supply. Today, of course, South Korea is one of the wealthiest countries in Asia and exports, not workers, but well-respected goods such as Samsung electronics and Hyundai and Kia vehicles to the rest of the world.
Just fifteen years ago, there were only a few hundred thousand expats in all of South Korea. Today, that number is well north of one million. Most Western expats live here among the nearly twelve million people who populate Seoul.
And, while you may not have considered a North Asian country in your plans for your second residency or second passport, South Korea does offer the opportunity for you to get permanent residence if you’re willing to invest in a local Korean business.
South Korean residency through the D-8 investor visa
Getting an investor’s visa for South Korea used to be easy. Not that many years ago, it was possible to come in with as little as 25 million won (US$25,000 in today’s dollars), claim to set up a business, withdraw the money, and live in South Korea indefinitely.
Eventually, the authorities wised up and increased the minimum deposit to $50,000, and then $100,000. Last year, there were rumblings it would increase significantly due to government dissatisfaction with the way people were getting South Korean visas and not contributing to the economy.
Today, you can get an investor visa if you’re willing to bring capital with you, but you have to actually generate some profit or economic activity.
Here’s how it works: South Korea issues D-8 investor visas to those willing to invest 300 million won — roughly US$282,000 — in their own small business in South Korea. You have to show that the business is viable when you renew the visa, or you may be denied a renewal.
South Korea’s investor visa is really a hybrid of the typical entrepreneur visa that encourages innovators to bring their talents to a new country, and an investor visa which seeks to bring capital into the country.
If you have a great new idea for a biotech company that will change the world, the requirements in countries like Hong Kong, Singapore, or even Japan will be lower. Countries are competing for ideas that could give them added business clout.
If, however, you want to start a restaurant or some form of lifestyle business, South Korea might be an attractive place, especially if you enjoy the country’s lifestyle. Because South Korea puts an actual dollar amount (and few other restrictions) on getting a D-8 visa, you don’t have to have an earth-moving idea.
While I’ve been told by friends of mine in the business that the Singapore government likes high-end restaurant concepts as business plans, you’ll need more capital to immigrate to Singapore on such a business plan than someone who has the next hot software company.
Discover how to get a Second Residency and Passport
A second passport in South Korea
It is possible to become a naturalized citizen of South Korea if you maintain actual residence here. There are three paths to citizenship through naturalization, but the most typical for a foreigner is “General naturalization”.
Under this process, you must have lived in South Korea for five consecutive years and have a general knowledge of the Korean culture. Plus, you must also be able to speak at least basic Korean.
While there are always cracks in the system in these cases, South Korea isn’t some corrupt banana republic where you can pay the immigration official five thousand won and get by with no knowledge of Korean.
It’s possible to get your citizenship here earlier, but you have to have been married to a South Korean national for at least two years.
Dual citizenship law in South Korea was recently amended to liberalize the process of holding dual citizenship. In light of this, most foreigners will not need to renounce their existing nationality if they become South Korean citizens.
The cost of a visa here is understandably expensive, especially considering that many Chinese and other nearby nationalities call Korea home. This is a developed, wealthy country and you can’t get permanent residence on the cheap.
Nor is South Korea a tax haven for corporations. There’s a ten percent minimum corporate tax, and a graduated system that peaks in the mid-twenties.
However, there are opportunities to be had if you are willing to live here and keep your ear to the ground. And there is certainly no shortage of money in many parts of Seoul, particularly the now infamous Gangnam area.
If you’re looking for a “first world” Asian passport, World 2nd Passport, Qualification Index of Arton Capital, however, that might just be a price you’re willing to pay.
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