During the last few years, Singapore has become an economic hub in Asia which is why many foreign investors have started to open companies here. Another country which has tried to catch up to Singapore is South Korea. In order to fill the gap, the South Korean Government has enabled a new law on foreign investments which should have attracted foreign direct investment. Even if the differences between the two countries have narrowed to some extent, Singapore continued to remain ahead of South Korea and even similar states like Hong Kong in most international reports, among which the most important is the Doing Business Index issued on a yearly basis by the World Bank.
Below we will take a look at how easy it is to open a company in Singapore compared to starting a business in South Korea. If you are interested in Singapore company formation, our local agents can offer detailed information.
You can also watch the video below for a comparison between opening a company in Singapore and South Korea:
How easy is it to open companies in Singapore and in South Korea?
Thanks to the new FDI law, it is easier for foreign enterprisers to register companies in South Korea. However, Singapore provides more tax facilities and a 3-step company registration procedure. In order to make a correct assessment and comparison between Singapore and South Korea in terms of company formation we will check the steps required to open companies in both countries.
The company formation process in South Korea consists in:
- – applying for a company seal;
- – preparing the company incorporation documents;
- – notarizing the statutory documents;
- – filing the paperwork with the Small and Medium Business Administration (SMBA);
- – opening the corporate bank account;
- – registering for taxation purposes.
The good news is that the process takes about 3 days, as most of the authorities have been centralized in the SMBA a while back.
The company registration procedure in Singapore consists in:
- – preparing the documents for company formation;
- – reserving a company name;
- – filing the statutory documents with ACRA;
- – registering for taxation purposes;
- – making a company seal.
Compared to South Korea, the Singapore company formation process takes between one and three days maximum considering the time required for preparing the documentantion. The company name reservation, the filing of the documents and the tax registration are completed in the same day.
Singapore and South Korea in terms of foreign investor visas
All foreign investors are required to apply for entrepreneur visas which is a common step in both Singapore and Korea. However, Singapore issues one type of entrepreneur pass which can be obtained quite easy, while South Korea has implemented a more complicated visa system which is based on the amount of money invested: depending on the sum invested, the enterpriser will qualify for a certain visa. This is also what kept Singapore ahead of South Korea in the Ease of Doing Business Report in 2016.
Should you want to open a company in Singapore, do not hesitate to contact our company formation experts.