Korea MA Taxation Guide 2008.pdfVIP

Korean MA Taxation Guide 2008 Mergers Acquisitions – Asian Taxation Guide 2008 Korea March 2008 PricewaterhouseCoopers 1 Korea Country MA Team Country Leader ~ Song Sang-Keun Lee Jin-Young Lee Alex Joong-Hyun Lee Sang-Do March 2008 Mergers Acquisitions – Asian Taxation Guide 2008 Korea 2 PricewaterhouseCoopers Name Designation Office Tel Email Song Sang-Keun Partner +822 709 0559 sang-keun.song@ Lee Jin-Young Partner +822 709 0557 david.jin-young.lee@ Lee Alex Joong-Hyun Partner +822 709 0598 alex.joong-hyun.lee@ Lee Sang-Do Partner +822 709 0288 sang-do.lee@ PricewaterhouseCoopers Seoul – LS Yongsan Tower (fka. Kukje Center Building), Hangangro 2 ga, Yongsanku, Seoul 140-702, Korea Mergers Acquisitions – Asian Taxation Guide 2008 Korea March 2008 PricewaterhouseCoopers 3 1. Introduction 1.1 General Information on MA in Korea MA opportunities in Korea have increased since the Asian Economic Crisis in the late 1990s. Cross- border acquisitions have been particularly brisk in various industries. Sales of distressed companies have represented a large proportion of MA deals in Korea since the Asian Economic Crisis. In recent years, a growing number of companies are turning their attention to MA opportunities in order to increase corporate revenues and / or to gain various synergistic benefits. MA activities among listed companies are also expected to become more common as shareholders become more knowledgeable about the advantages of MA activities and related tax and legal issues. Although the number of MA deals in Korea is growing, the Korean government continues to provide tax and other benefits to actively promote MA activities. 1.2 Common Forms of Business Entity The following forms of business entity are available in Korea. However, Chusik Hoesa is by far the most common form of business entity although recently Yuhan Hoesa has been used by some U.S. companies as it may be used to benefit from “check-the-box” rules under the U.S. tax cod