Expanding a Turkish business into South Korea

The Türkiye–Korea framework

The Korea–Türkiye Free Trade Agreement (한-튀르키예 FTA, han-tyureukiye FTA) was built in parts. The framework and goods agreements, signed on 1 August 2012, entered into force on 1 May 2013; the services and investment agreements, signed on 26 February 2015, followed on 1 August 2018. The goods agreement eliminated tariffs on industrial goods within at most seven years and liberalised most agricultural trade within ten, with exceptions for sensitive products; it was the first Turkish FTA to include agricultural goods. The services agreement opened eighteen sectors in Türkiye beyond its WTO commitments, including construction, engineering, film and environmental services, and the investment agreement modernised investor-state dispute settlement. Türkiye is also in a customs union with the EU, which is why the Korea–Türkiye FTA mirrors much of the EU–Korea agreement.

Trade is lopsided. Turkish statistics show Korean exports to Türkiye several times larger than Turkish exports to Korea throughout the past decade; the two governments put total trade at about USD 11 billion in 2025. Türkiye’s exports to Korea have been led by pharmaceutical products, liquefied gas, vehicle components, electrical machinery and clothing, alongside minerals, food and leather goods. At the joint economic commission in Seoul in February 2026, the two sides pointed to nuclear power, AI, semiconductors, batteries and renewables as areas for closer cooperation, and Korean investment in Türkiye stands at roughly USD 1.9 billion.

Four ways in

1. A Korean importer or distributor

Turkish food, confectionery, dried fruit and nuts, olive oil, textiles and home goods usually reach Korea through a Korean importer who registers the products, holds stock and sells to retailers and online platforms. No Korean entity is needed. Keep it buy-and-resell: an agent who concludes contracts in the Turkish company’s name can create a permanent establishment (국내사업장, gungnae saeopjang). Food needs foreign plant registration and Korean labels; see food and beverage import rules. Register the trademark first; see trademark registration.

2. A liaison office

A liaison office (연락사무소, yeollak samuso) lets a Turkish manufacturer place staff in Korea for market research, sourcing from Korean suppliers and technical support, without Korean income; see liaison offices. It suits Turkish automotive and machinery groups that buy Korean components as much as they sell.

3. A branch

A branch of the anonim şirket (A.Ş.) or limited şirket (Ltd. Şti.) registered under Article 614 of the Commercial Act can trade and employ; the Turkish company is liable for everything, and changes in its trade registry must be mirrored in Seoul. See branch or subsidiary.

4. A Korean subsidiary

Most Turkish companies that intend to stay form a Jusik Hoesa (주식회사, jusik hoesa). Regulated products — pharmaceuticals, medical devices, cosmetics, electrical goods — need a Korean importer of record that holds the approvals, and Turkish groups usually want that to be their own company. With at least KRW 100 million of capital the company is registered as a foreign investment under the Foreign Investment Promotion Act, which supports the D-8 visa for a director from Türkiye; see the KRW 100 million rule.

Company documents from Türkiye

Typical documents for a Turkish corporate shareholder.

Türkiye is a party to the Hague Apostille Convention. Notarised documents are apostilled by the district governorship or provincial governorship, and court documents by the courts; the chamber of commerce certificate must usually be notarised first. The imza sirküleri is the key document for Korean registries and banks: it shows who may sign for the company and how, so the board resolution and power of attorney must be signed by the people and in the combination it shows. Documents can be in English or Turkish with Korean translations made in Seoul; the Korean registry wants them recent — usually within three months. See apostilles for Korea.

Turkish shareholders also need to think about the Turkish side of the investment: capital is wired from the company’s own account in a convertible currency, Turkish banks ask for the investment documentation, and the Korean foreign exchange bank certifies receipt for the foreign investment notification.

Setting up the Korean company

The Korean steps are the same for every foreign investor: foreign investment notification at a Korean foreign exchange bank, capital wired and certified, court registration, business registration (사업자등록, saeopja deungnok) with the tax office, and a customs clearance code for importers. With documents ready, the Korean part takes two to four weeks; see registering a company in Korea. The company keeps Korean-language books, appoints at least one director, registers a corporate seal and files corporate tax, VAT and payroll returns on the Korean calendar; see annual compliance.

Trading under the FTA

Turkish goods that meet the FTA’s rules of origin enter Korea at preferential rates — for industrial goods, now duty-free. The Korean importer claims the preference under the FTA Customs Act with the origin declaration on the commercial documents, and Korea Customs can verify origin years later, so keep supplier declarations and bills of materials. Because Türkiye is in a customs union with the EU, goods of EU origin re-exported from Türkiye do not become Turkish: origin follows production, not the seller. Agricultural products with socio-economic sensitivity still face tariffs or quotas; check the schedule for each line on the Korea Customs portal. Before the first shipment, ask the Korean importer’s customs broker to confirm the tariff line, the preferential rate and the origin rule for each product: a misclassified product loses the preference, and Korea Customs can recover the duty with penalties after an origin verification, often years later.

Regulation decides more than tariffs. Pharmaceuticals — one of Türkiye’s largest exports to Korea — need Ministry of Food and Drug Safety approval, a Korean importer licence and quality testing; see pharmaceutical imports. Halal-certified Turkish food has a growing niche among Korea’s Muslim residents and visitors, but Korean labelling and food-safety rules apply in full. Electrical goods need KC certification, and cosmetics need a Korean responsible seller. See importing into Korea and customs duties.

Korean tax and the 2024 treaty

The Korean subsidiary pays corporate tax at 10% to 25% plus local income tax of one-tenth, and charges 10% VAT; see Korean corporate tax. Payments to Türkiye bear Korean withholding of 22% under domestic law unless the Korea–Türkiye tax treaty (한·튀르키예 조세조약) reduces it. A new treaty, signed on 22 October 2021, entered into force on 21 July 2024 and replaced the 1983 treaty. According to Korea’s finance ministry it lowers the maximum source-country withholding rate from 20% to 15%; it adopts the credit method for relief in both countries, settles dual residence of companies by mutual agreement, allows the source state to tax gains on property held for a year or less, and contains a principal purpose test against treaty shopping.

Treaty databases have not all caught up with the new rates; confirm the dividend, interest and royalty rates and the holding thresholds against the treaty text before the first payment. To claim the treaty rate, the Turkish recipient gives the Korean payer a limited tax rate application (제한세율 적용신청서, jehan seyul jeogyong sincheongseo) with a Turkish certificate of residence before payment under Article 98-6 of the Corporate Tax Act; see Korea’s treaties ranked and dividend withholding.

Turkish tax on Korean profits

Turkish corporate tax is 25%. Dividends a Turkish company receives from a foreign subsidiary are exempt under the participation exemption (iştirak kazançları istisnası) in the Corporate Tax Law if, broadly, the Turkish company has held at least 10% for at least a year without interruption, the subsidiary is a capital company subject to corporate tax of at least 15% in its country, and the dividend is brought to Türkiye by the deadline for filing the corporate tax return. A Korean Jusik Hoesa paying Korean corporate tax at normal rates meets the tax-burden test in most years; a small company in the first bracket — 11% including local tax — should check it.

Türkiye’s controlled foreign company rules apply to foreign subsidiaries with mainly passive income and an effective tax burden below 10%, which a Korean trading or service company normally exceeds. Branch profits are taxed in Türkiye with a credit for Korean tax, unless exempt under the branch exemption rules for profits taxed abroad. Transfer prices between the Turkish parent and the Korean subsidiary must be at arm’s length in both countries; see Korea as a trading link for the models.

People and visas

Turkish citizens can visit Korea without a visa for short business trips under a bilateral agreement, subject to Korea’s electronic travel authorisation rules at the time of travel. Working in Korea needs a visa: a Turkish shareholder-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. Staff transferred from Türkiye to a Korean branch or subsidiary usually use D-7 or E-7; see the E-7 guide.

Korea and Türkiye have had a social security agreement since 1 June 2015: an employee posted from Türkiye can stay in the Turkish system for the agreed posting period with a certificate of coverage from the SGK and be exempt from the Korean National Pension; Korean health insurance still applies. Local staff are employed under Korean labour law, with written contracts, the national minimum wage, four insurances and severance after one year of service; see Korean social insurance.

Where Turkish companies can win

The obvious categories are food and consumer goods where Türkiye is a world leader — hazelnuts, dried apricots and figs, olive oil, confectionery, home textiles — and where Korean consumers have shown appetite for Mediterranean and Middle Eastern food. Turkish pharmaceutical exporters already have Korean customers and can build on them. Automotive and machinery suppliers can sell to Korean groups with plants in Türkiye and elsewhere, and Turkish construction and engineering firms can partner with Korean contractors on third-country projects, as Korean and Turkish firms did on the Çanakkale 1915 Bridge. Defence and energy cooperation between the two governments creates openings for suppliers on both sides.

The hard parts are distance, language and the speed of Korean commerce: Korean buyers expect samples, certifications and replies in days, and Korean-language marketing on Naver, Kakao and Coupang rather than a translated website. A Korean partner or subsidiary with Korean-speaking staff is usually the difference, and Turkish brands that invest in Korean-language content and customer service early tend to keep the market they open; see selling on Korean marketplaces.

Turkish support for the move

• The Ministry of Trade’s commercial counsellors at the Turkish Embassy in Seoul provide market information, buyer introductions and trade-fair support.
• Turquality and other export support programmes co-fund branding, market entry, overseas offices and marketing for eligible Turkish exporters — including the costs of a foreign subsidiary in some programmes.
• Türk Eximbank provides export credit and credit insurance for receivables from Korean buyers.
• DEİK, the Foreign Economic Relations Board, runs the Türkiye–Korea Business Council, and the two governments’ Joint Economic Commission meets periodically, most recently in Seoul in February 2026.
• Exporters’ associations for hazelnuts, dried fruit, textiles and other sectors organise Korean trade missions and fairs.

Money, currency and contracts

Turkish exporters usually invoice Korean customers in US dollars or euros; Korean banks handle both easily, and a Korean subsidiary can hold foreign-currency accounts. Lira volatility makes it sensible to keep the Korean company’s capital and working cash outside lira, and to price intercompany sales in the currency in which the Korean company sells. Contracts with Korean buyers should be in English with a Korean translation, under a governing law and dispute forum both sides accept — Korean courts, or arbitration in Seoul, Istanbul or a neutral seat; see collecting debts in Korea. Payment by letter of credit or with export credit insurance is common for first orders, until the relationship has a payment history.

Protect the brand

Korea is a first-to-file trademark system. File the brand with KIPO — directly or through the Madrid system via the Turkish Patent and Trademark Office — before the first trade fair or distributor meeting, and consider a Hangul version so Korean consumers can search for it. Turkish words with ğ, ş, ı and ç are often transliterated in Korea; register the forms customers will type. See trademark registration in Korea.

A worked example

An İzmir producer of dried figs, apricots and nut snacks has sold to a Korean importer for three years. To build its own brand, it forms a Jusik Hoesa in Seoul with KRW 150 million of capital. Its Trade Registry Gazette extracts, activity certificate, signature circular and board resolution are notarised in İzmir and apostilled; the Korean registry receives Korean translations. The company registers as a food importer, registers its Turkish plant with the Ministry of Food and Drug Safety, and files its brand with KIPO in Latin letters and Hangul.

Goods ship from İzmir with an origin declaration and enter Korea under the FTA’s preferential rates. A Turkish manager moves to Seoul on a D-8 visa and stays in the Turkish social security system under the 2015 agreement. In year three the Korean company earns KRW 250 million of profit, pays Korean corporate tax and a dividend to İzmir under the new treaty; with a 100% holding of more than a year and Korean tax above 15%, the dividend qualifies for the Turkish participation exemption.

Mistakes we see

1. Documents signed by the wrong combination of signatories under the imza sirküleri.
2. Old treaty rates used after the 2024 treaty took effect — or new rates assumed without checking the text.
3. EU-origin goods shipped from Türkiye claimed as Turkish under the FTA.
4. Food without plant registration or Korean labels.
5. A distributor holding the Korean approvals with no transfer clause.
6. Posted staff without a certificate of coverage, paying pension twice.
7. Dividends not brought to Türkiye by the return deadline, losing the participation exemption.

Korean terms you will meet

Questions readers ask

About the author

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.

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