- Most Swiss companies that stay form a Korean Jusik Hoesa owned by the AG or GmbH; a branch, a liaison office or a distributor are the alternatives.
- Swiss documents come from the cantonal commercial register and notaries, and are apostilled by the cantonal state chancellery.
- The EFTA–Korea FTA, in force since 2006, covers more than 99% of industrial trade; agriculture runs under a separate Swiss–Korean agreement.
- The treaty caps Korean withholding at 5% on dividends to a Swiss company holding 10% or more, 5% on royalties and 10% on interest (5% for banks).
- Switzerland gives a participation deduction on Korean dividends and gains; it has no CFC rules.
- Seconded staff can stay in the Swiss AHV/IV for up to six years under the 2015 social security agreement.
The Switzerland–Korea framework
Trade runs on the EFTA–Korea Free Trade Agreement (한-EFTA 자유무역협정, han-EFTA jayu muyeok hyeopjeong), in force since 1 September 2006 — Korea’s first trade agreement with European countries. It removed duties on more than 99% of industrial trade and covers services, procurement and intellectual property; agricultural goods are dealt with in separate bilateral agreements between Korea and each EFTA state. Trade between Korea and the EFTA states roughly tripled after 2005 and passed EUR 8.5 billion in 2025, and Switzerland is by far the largest part of it. UN Comtrade data put Swiss goods exports to Korea at USD 4.38 billion in 2025, led by watches (about USD 956 million), precious metals and stones (USD 901 million), pharmaceuticals (USD 881 million), machinery (USD 547 million) and medical and optical instruments (USD 297 million).
Tax relations are governed by the Korea–Switzerland double taxation agreement (Doppelbesteuerungsabkommen), amended by a protocol in force since 25 July 2012 that added modern exchange of information. Its rates are among the best Korea offers: 5% on dividends to a company holding at least 10%, 5% on royalties. A social security agreement (Sozialversicherungsabkommen) signed in January 2014 has been in force since 1 June 2015. Both countries apply the Hague Apostille Convention.
Four ways in
1. A Korean distributor or importer
Watches, chocolate, cosmetics and many industrial products reach Korea through exclusive Korean distributors who hold stock, run retail relationships and handle certification. No Korean entity is needed. Keep the relationship buy-and-resell: an agent who habitually concludes contracts for the Swiss company can create a permanent establishment (국내사업장, gungnae saeopjang) under Article 94 of the Corporate Tax Act and Article 5 of the treaty. For regulated products, decide who holds the Korean product licence before signing — a distributor that owns your approvals owns your market. Register the trademark first; see trademark registration.
2. A liaison office
A liaison office (연락사무소, yeollak samuso) places staff in Korea for research, promotion, quality control and technical support, reported to a foreign exchange bank under the Foreign Exchange Transactions Act, with no Korean income. It suits Swiss machinery and component makers supporting Korean customers through a distributor; see liaison offices.
3. A branch
A branch is the Swiss AG or GmbH itself registered in Korea under Article 614 of the Commercial Act. The Swiss company is liable for everything, and changes in the Swiss commercial register — new board members, new signatories — must be mirrored in the Korean registry. Korea taxes branch profits at normal corporate rates; Switzerland exempts profits of a foreign permanent establishment from its own tax base. See branch or subsidiary.
4. A Korean subsidiary
Most Swiss companies that intend to stay form a Jusik Hoesa (주식회사, jusik hoesa) owned by the Swiss parent. For medtech and pharma it is close to essential: the Korean importer of record holds the product approvals, reimbursement listings and pharmacovigilance duties, and Swiss groups want those in their own hands. With at least KRW 100 million of capital the company is a registered foreign investment under the Foreign Investment Promotion Act, which opens the D-8 visa for a director from Switzerland; see the KRW 100 million rule.
Company documents from Switzerland
A Swiss company’s facts sit in the cantonal commercial register (Handelsregister / registre du commerce), published through Zefix and the Swiss Official Gazette of Commerce. A Korean registry and bank want:
| Document | Swiss name | Korean | Treatment |
|---|---|---|---|
| Certified register extract | Handelsregisterauszug / extrait du registre du commerce | 법인등기부에 해당하는 서류 | Certified by the register; recent; apostille |
| Articles of association | Statuten / statuts | 정관 | Certified copy; apostille |
| Decision to invest in Korea | Verwaltungsratsbeschluss (AG) or Beschluss der Geschäftsführer (GmbH) | 이사회 의사록 | Signed per the signing authority; notarised; apostille |
| Power of attorney | Vollmacht / procuration | 위임장 | Notarised; apostille |
| Beneficial owners | Register of beneficial owners kept by the company | 실제소유자 확인 자료 | For the bank’s AML checks |
Typical documents for a Swiss corporate shareholder.
Two Swiss features matter. First, signing authority (Zeichnungsberechtigung): the register extract states whether each person signs alone or jointly with another — Einzelunterschrift (sole signature) or Kollektivunterschrift zu zweien (joint signature by two). The resolution and power of attorney must follow it exactly, or the Korean registry will reject them. Second, language: extracts are issued in German, French or Italian depending on the canton. Korea needs a Korean translation in any case, made in Seoul; an English version helps the Korean bank but has no official status.
Order the extract shortly before filing — Korean bodies generally expect it to be no more than three months old — and make sure the power of attorney lists each Korean act: foreign investment notification, share subscription, court and tax registration, bank accounts and registration of the company seal.
Personal documents and the apostille
| Document | Swiss issuer | Used for | Treatment |
|---|---|---|---|
| Passport | Federal Office of Police (fedpol) via cantonal passport offices | Registry, bank, visa | Certified copy by a notary; apostille. Original shown in Korea |
| Criminal record extract | Federal Office of Justice (Strafregisterauszug) | Long-term visas where requested | Apostille by the Federal Chancellery |
| Civil status documents | Cantonal civil registry (Zivilstandsamt) | Dependants’ visas | Apostille by the canton |
| Director’s signature | Cantonal notary | Korean registry, in place of a seal certificate | Notarised; apostille by the canton |
| Tax residence certificate | Cantonal tax administration or the Federal Tax Administration | Treaty rates on Korean income | For the company and individuals |
Typical personal documents for a director moving to Korea.
Switzerland splits the apostille by origin. The cantonal state chancellery (Staatskanzlei / chancellerie d’État) apostilles documents issued or notarised in its canton — register extracts, notarised resolutions, civil status documents. The Federal Chancellery (Bundeskanzlei) apostilles federal documents such as the criminal record extract. Notarial practice is cantonal too: Latin-type notaries in French-speaking cantons, Basel and Bern, official notaries in Zurich. A Zurich AG signing in Geneva needs the Geneva chancellery for the notarised signature. See apostilles for Korea.
Check the Zeichnungsberechtigung, sign in front of a notary in the right canton, and take the papers to that canton’s chancellery. That is the whole Swiss side.
Voixa Korea
Setting up the Korean company
The investment is notified to a Korean foreign exchange bank under Article 5 of the Foreign Investment Promotion Act; the capital is wired from the Swiss company’s own account in Swiss francs, euros or US dollars and the bank certifies receipt. Switzerland requires no approval for outbound investment. The company is registered with the court and obtains its business registration number (사업자등록번호, saeopja deungnok beonho); an importer also needs a customs clearance code. With documents ready the Korean part takes two to four weeks; see registering a company in Korea.
Korean directors serve terms of up to three years under Article 383 of the Commercial Act and are re-registered on renewal. The company registers a corporate seal (법인인감, beobin ingam) and files corporate tax, VAT and payroll on the Korean calendar; see annual compliance.
Trading under the EFTA–Korea FTA
Swiss goods qualify for preferential rates if they meet the agreement’s product-specific rules of origin, proved by an origin declaration on the invoice; the Korean importer claims the preference under the FTA Customs Act, and Korea Customs Service can verify origin years later. Watches and precision instruments are duty-free; machinery and chemicals too. Swiss cheese, chocolate and other agricultural products depend on the bilateral agricultural agreement between Switzerland and Korea, which is narrower. The ambassadors of Switzerland and Norway have publicly called for the 2006 agreement to be modernised — simpler customs procedures and origin rules, digital trade — but in 2026 it remains the original text.
Regulation, not tariffs, is where Swiss companies spend their time. Medical devices and pharmaceuticals need approval from the Ministry of Food and Drug Safety and, for reimbursement, listing with HIRA — Swiss approvals and CE marks help with the dossier but do not replace it; see pharmaceutical imports. Electrical products need KC certification; food needs plant registration and Korean labels; cosmetics have their own regime. Precious metals and watches meet anti-money-laundering and customs valuation scrutiny. See importing into Korea and customs duties.
Korean tax and the treaty
The Korean subsidiary pays corporate tax at 10% to 25% plus local income tax of one-tenth under Article 55 of the Corporate Tax Act — 11% on the first KRW 200 million — and charges 10% VAT. Payments to Switzerland bear Korean withholding, reduced by the treaty:
| Payment from Korea to Switzerland | Korean domestic rate | Treaty rate | Condition |
|---|---|---|---|
| Dividends | 22% | 5% | Swiss company holding at least 10% of the capital |
| Dividends — other | 22% | 15% | Smaller holdings and individuals |
| Interest | 22% | 10% | 5% where the lender is a bank |
| Royalties | 22% | 5% | Patents, know-how, trademarks, copyright |
| Service fees | Usually none | Business profits article | No Korean tax without a permanent establishment |
Domestic rates include Korean local income tax. Sources: PwC Worldwide Tax Summaries, Korea, 2026; Clearstream on the 2012 protocol.
Note the threshold: 10%, not 25%. A Swiss company in a joint venture with a Korean partner, or holding a minority stake, still gets 5% from 10% upwards. Royalties at 5% are also among the lowest in Korea’s treaties, which matters to Swiss brand and technology owners licensing to a Korean subsidiary — as long as the royalty is at arm’s length and the Swiss company really owns and manages the IP. To claim the rates, the Swiss company files a limited tax rate application (제한세율 적용신청서, jehan seyul jeogyong sincheongseo) with the Korean payer before payment under Article 98-6 of the Corporate Tax Act, with a Swiss tax residence certificate. Without it, 22% is withheld. See Korea’s treaties ranked for how Switzerland compares.
Swiss tax on Korean profits
A Swiss company that holds at least 10% of the Korean company, or a stake worth at least CHF 1 million, claims the participation deduction (Beteiligungsabzug) on Korean dividends at federal and cantonal level, which removes almost all Swiss profit tax on them; gains on selling a 10%+ stake held for a year qualify too. Because little Swiss tax is left, the Korean 5% is effectively a final cost. Switzerland has no controlled foreign company rules, so undistributed Korean profits are not taxed in Switzerland. Groups in scope of the OECD minimum tax — consolidated revenue of EUR 750 million or more — apply Switzerland’s domestic top-up tax and, from 2025, its income inclusion rule; a Korean subsidiary paying normal Korean rates rarely produces a top-up.
A branch is outside the Swiss tax base altogether: Switzerland exempts the profits of a foreign permanent establishment, taking them into account only for the rate. Transactions between the Swiss parent and the Korean subsidiary must be at arm’s length in both countries — under the Swiss Federal Tax Administration’s practice and under Article 7 of the Adjustment of International Taxes Act in Korea.
A Swiss individual who owns the Korean company directly pays 15% Korean withholding on dividends. Switzerland taxes the dividend as income — with partial taxation for qualifying holdings of 10% or more — and credits the Korean residual tax on application to the Federal Tax Administration. For most founders, holding through a Swiss company is simpler.
Staff, social security and visas
Swiss citizens can visit Korea visa-free for up to 90 days for meetings and market visits, subject to Korea’s electronic travel authorisation rules at the time of travel. Working in Korea needs a visa under the Immigration Act: a Swiss investor-director managing a company with at least KRW 100 million of foreign investment applies for the D-8 corporate investment visa (기업투자 비자, gieop tuja bija); see D-8 requirements. Engineers and managers seconded to a subsidiary or branch usually come on a D-7 or E-7 visa.
The Korea–Switzerland social security agreement is generous on postings. An employee sent by a Swiss employer to Korea stays under Swiss AHV/IV (old-age, survivors’ and invalidity insurance) for up to six years and is exempt from the Korean National Pension (국민연금, gungmin yeongeum) and Korean employment insurance, with a certificate of coverage from the Swiss compensation office. Korean national health insurance still applies. Locally hired staff are covered in Korea under the Labour Standards Act, with written terms, four social insurances and severance after a year; see hiring in Korea.
Swiss support for the move
- Switzerland Global Enterprise runs the Swiss Business Hub Korea inside the Embassy of Switzerland in Seoul: market studies, partner searches and introductions, with consultants in Zurich for Japan and Korea.
- SERV, the Swiss Export Risk Insurance, covers payment and political risk on Korean buyers.
- The Embassy of Switzerland in Seoul leads official visits and supports regulatory dialogue, including in pharma and medtech.
- Swiss business associations in Seoul connect Swiss companies with each other and with Korean partners.
Where Swiss companies win in Korea
Korea is one of the world’s most demanding luxury markets, and Swiss watches are its single largest import from Switzerland; Korean department stores and duty-free operators are the gatekeepers. In healthcare, an ageing population and one of the highest per-capita uses of medical services in the OECD support Swiss pharma, diagnostics and medtech — Roche and Novartis have long had Korean subsidiaries. Swiss machinery, automation, precision tools and testing equipment serve the semiconductor, battery, shipbuilding and automotive industries, where Korean buyers expect local engineers and fast service. Switzerland Global Enterprise also points to cleantech, digital health, food and premium beverages.
Korea’s own strengths cut both ways: its biopharma and medical device makers are strong competitors at home, and its procurement rules favour suppliers with local presence. A Korean subsidiary with Korean-speaking application engineers is often the difference between a distributor’s catalogue and a supplier list.
Protect the brand
Korea is a first-to-file (선출원주의, seonchurwonjuui) trademark system under Article 35 of the Trademark Act. Swiss watch and consumer brands are prime targets for squatters; file through the Madrid system via the Swiss Federal Institute of Intellectual Property or directly with KIPO before the first trade fair, and consider a Hangul version. Geographical and “Swiss made” indications have their own protection questions; see trademark registration in Korea.
A worked example
Rheinblick Diagnostics AG, a Basel company that makes point-of-care testing devices, has sold in Korea for three years through a distributor that holds the Korean product approvals. To take control of the approvals and the hospital relationships, it forms a Jusik Hoesa in Seoul with KRW 500 million of capital, wholly owned by the AG and notified as a foreign investment. The register extract says the company is signed for by two members of the board jointly; both sign the resolution and power of attorney before a Basel notary, and the Basel-Stadt state chancellery issues the apostilles. The distributor transfers the approvals to the new company under a negotiated exit agreement.
A Swiss product manager moves to Seoul on a D-8 visa as representative director and stays in the AHV under the six-year posting rule; regulatory and sales staff are hired locally. The Korean company buys devices from Basel at benchmarked prices and pays a 4% royalty for the technology, with 5% Korean withholding. In year three it makes KRW 400 million of profit, pays KRW 66 million of Korean corporate and local income tax and a KRW 250 million dividend with 5% withholding — KRW 12.5 million. In Basel the dividend benefits from the participation deduction.
Mistakes we see
- Signing with one director when the register says Kollektivunterschrift zu zweien.
- Apostilles from the wrong canton — the chancellery follows the notary, not the head office.
- Letting the distributor hold the product approvals with no transfer clause.
- An agent concluding contracts for the Swiss company and creating a Korean permanent establishment.
- No treaty application before the first dividend or royalty.
- Assuming Swiss approvals are enough for Korean medical device or drug registration.
- Using a Swiss holding as a conduit and meeting the 35% withholding on the way out.
- Filing the trademark after the brand is already on sale.
Korean terms you will meet
Questions readers ask
How does a Swiss company set up in South Korea?
Usually through a Korean Jusik Hoesa owned by the Swiss AG or GmbH, notified as a foreign investment. A branch, liaison office or Korean distributor are the alternatives.
Which Swiss documents does Korea need?
A recent certified commercial register extract, the articles, a board or managing directors’ resolution and a power of attorney, notarised and apostilled by the cantonal state chancellery, with Korean translations.
What is the Korean withholding tax on dividends to Switzerland?
5% for a Swiss company holding at least 10% of the capital, 15% otherwise, instead of 22%.
What is the withholding on royalties from Korea to Switzerland?
5% under the treaty, against 22% under Korean domestic law.
Does Switzerland tax dividends from a Korean subsidiary?
A Swiss company with a 10% or CHF 1 million holding claims the participation deduction, which removes almost all Swiss profit tax on them. Switzerland has no CFC rules.
Do Swiss goods enter Korea duty-free?
Industrial goods meeting the EFTA–Korea FTA rules of origin do; agricultural goods depend on the narrower Swiss–Korean agricultural agreement.
How long can a Swiss employee be posted to Korea without joining the Korean pension?
Up to six years under the social security agreement in force since 1 June 2015.
- Trading Economics / UN Comtrade — Switzerland exports to South Korea
- PwC — Korea: withholding taxes and treaty rates
- Clearstream — Amended Korea–Switzerland treaty in force
- National Pension Service — Korea–Switzerland social security agreement
- Korea JoongAng Daily — 20 years of the Korea–EFTA partnership
- Switzerland Global Enterprise — South Korea
- Canton of Zurich — certifications and apostilles
Alexander Baranov
Founder of the BCA Group · cross-border corporate and tax adviser since 2008
Alexander advises foreign founders and groups on company formation, tax structuring and corporate law in more than 40 jurisdictions across Europe, the Gulf, Asia and Latin America. He is the author of nine books on international business and tax and writes regularly for professional finance and tax journals. He works in English, German, Spanish and Russian.
This guide is based on the Korean statutes cited in the text and on our own filings. It is reviewed when the law or official rates change.